Executive summary
Tariff-driven uncertainty led the Fed to cut its 2025 U.S. growth projection to 1.7% and raise inflation to 2.7%, keeping policy cautious with only two moderate cuts signaled for the year. Long-term and mortgage rates should stay elevated through 2026 — pressuring refinancings and new development while shifting demand toward rental housing — as cap rates peak and stabilize at a new level. Across property types, the edge lies in reading where each local submarket sits in the real estate cycle.
Highlights
01Growth cut to 1.7% as tariffs revive stagflation risk
02Higher-for-longer rates; mortgages elevated through 2026
03Cap rates peaked and stabilized at a new level
04Resilient rental demand on a structural housing shortage
05Sector positioning mapped across the four cycle phases
06Opportunity in discounted, stressed acquisitions
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Published by Ativore Asset Management
