The Risks of Timing the Market in Today’s CRE Environment

Why Waiting Could be Costly

Many owners across the commercial real estate spectrum are holding out and waiting for the perfect time to sell, anticipating favorable conditions like a Federal Reserve rate cut or a sudden surge of buyers. However, a closer look at national data and market trends reveals a different reality. Rather than waiting for an uncertain future, sellers may find a more favorable window in today’s market, before listing volumes potentially rise. The following outlines key factors to consider when deciding whether to bring a property to market now or hold off.

 

The Illusion of Market Timing

While real estate cycles follow recognizable phases, like recovery and recession, trying to predict the exact peak or trough is nearly impossible and often leads to costly mistakes.

 

Sellers who attempt to wait out the current market risk missing their optimal window entirely. Instead of trying to sell at an imagined peak in the future, the smarter approach is to focus on current market strength and existing buyer demand.

 

Strong Current Buyer Activity Amid Stable Conditions

Today’s market is witnessing a notable resurgence in buyer activity. With interest rates stabilizing and lenders reducing their required margins, debt is becoming more attractive and accessible. At the same time, increased volatility in the equities & stock markets—driven by uncertainty around tariffs and global trade—has redirected many investors back into commercial real estate, where tangible assets and steady cash flow offer a more reliable hedge.

 

Despite this renewed interest, the pool of market-priced sellers remains limited. This supply-demand imbalance is creating a unique opportunity for owners who list now, as they face less competition and benefit from heightened buyer demand.

 

The Coming Wave of Forced Sales

For those who wait, a significant factor threatening to reshape the market is the looming maturity wall of commercial debt. According to Cred iQ, around $275 billion of CRE debt is set to mature this year, on top of the $520 billion that was previously extended. While banks are showing some flexibility, this situation is creating a class of owners who may be forced into distressed sales, due to refinancing challenges.

 

Today’s listings benefit from reduced competition, attracting a more discerning pool of buyers. In 12 months, however, these same sellers could find themselves competing with a wave of distressed assets from owners who have no choice but to sell. Listing now allows owners to control the process and avoid competing with sellers who are desperate to exit.

 

Rate Cuts do not Mean Pricing Gains

A common misassumption among sellers is that a drop in interest rates will automatically lead to a drop in cap rates (i.e. higher property prices). However, historical data shows that the relationship between interest rates and property values is not a one-to-one correlation. While a decrease in Treasury yields typically reduces borrowing costs, cap rates are more heavily influenced by other factors.

 

Market sentiment, tenant risk, and property type are key drivers of commercial real estate pricing. Investor confidence, shaped largely by economic outlook, directly impacts how aggressively buyers pursue opportunities. While a soft landing is anticipated, a hard landing, marked by a recession or even a depression, could significantly impact tenant credit. If that occurs, buyer confidence is likely to erode. As tenants become riskier, properties may be viewed as less reliable income-producing assets, ultimately resulting in lower valuations.

 

Among all influencing factors, market supply and demand play the most critical role in shaping pricing. Despite a shortage of market-priced sellers, many stale and overpriced listings remain, adding to overall inventory levels. Combined with the anticipated influx of distressed assets, this increased supply will require a sustained period of strong transaction velocity, likely 6 to 18 months, before the market can fully reset and pricing adjusts more broadly.

 

Prepare to Position Ahead of the Curve

Sellers who act now have the opportunity to position their assets ahead of a potential surge in listings. With fewer comparable properties on the market, early movers benefit from greater visibility and stronger leverage in negotiations. Serious buyers are actively searching, and in today’s environment, well-priced, well-positioned assets are drawing attention quickly.

 

By listing before the market becomes more crowded, sellers can avoid the pricing pressure that often comes with increased competition. As more owners rush to sell following a rate cut, alongside a wave of distressed assets, listing volumes may surge, diluting buyer attention and increasing competition. Positioning ahead of that curve allows owners to maintain control over pricing, terms, and timing, while standing out in a market that currently favors proactive sellers.

 

Overall Takeaways

In today’s shifting CRE landscape, hesitation can be more damaging than action. While many sellers wait for ideal market conditions, those who move decisively now are positioned to benefit from limited competition, strong buyer demand, and favorable financing dynamics. The window to sell into a relatively stable and less saturated market is narrow and closing.

 

With distressed inventory on the horizon and pricing volatility likely to increase, sellers who wait may find themselves at a disadvantage, forced to compete in a crowded, discount-driven environment. By acting today, owners retain control over their timing, terms, and value—capitalizing on today’s momentum rather than reacting to tomorrow’s challenges.

 

The best opportunities aren’t always found at the perfect time. They’re secured by those who recognize when the time is good enough and move before the market does.