“Is now a good time to buy commercial real estate?”
This is one of the questions I hear most often – especially during times of uncertainty.
In early 2025, the commercial real estate market was buzzing with both excitement and hesitation. We have a new president, which always shakes things up. Add in a round of tariff policies and continued interest rate unpredictability, and it’s no wonder investors are pausing to ask, “Is now the right time to buy?”
Let’s walk through three things to consider if you’re on the fence.
1. Embrace Contrarianism
It’s human nature to follow the crowd. If your friend just bought a strip center and made a solid return, it’s tempting to think you should do the same. But in real estate investing, doing what everyone else is doing often means you’re late to the opportunity.
Thinking like a contrarian – meaning you intentionally look for deals in areas others are avoiding – can be a huge advantage. The key is to find markets or properties where the fundamentals are strong, but investor attention is low.
For example, Florida.
The state saw a big post-COVID surge, followed by some downward corrections tied to hurricanes and overvaluation. As a result, prices have come down. If you’re confident that you can secure reasonably priced insurance, this could be an excellent time to make a move in that market.
A lot of people are waiting on the sidelines to see how everyone else moves. If you have the nerve to do what others won’t, and you’re smart about your due diligence, this might be your moment.
2. Look at the Fundamentals
Forget the headlines for a second. Does the deal actually work?
That’s the question you need to ask, regardless of what’s happening in the broader economy. Even if interest rates are higher than you’d like, the math still matters most. If the property cash flows well and the numbers make sense at the current rate, you’re in good shape.
Let’s say you’re looking at a 7% loan. That’s not ideal, but it’s manageable. You can always refinance later if rates drop. And while it might not drop all the way back to the 3% or 4% range we saw a few years ago, even a moderate decrease could help to further improve your returns down the road.
But none of that matters unless the deal works now. If it does, don’t let fear hold you back.
3. Be Creative with Financing
One of the biggest hurdles investors face right now is making the numbers work at today’s interest rates. If the returns don’t pencil out at 7%, does that mean the deal is dead?
Not necessarily.
Back in the 1980s, interest rates were sky-high. But people still bought real estate, and they did it by getting creative. Seller financing was a common solution then, and it’s still a valuable tool today.
Here’s an example of how it can work:
- You get a first loan from the bank for 70% of the purchase price at a 7% interest rate.
- Then, the seller agrees to hold a second mortgage for another 15% at a 6% interest rate.
- You bring 15% to the table as your down payment.
That kind of structure lets you reduce your upfront cash requirement, which in turn boosts your cash-on-cash return. It’s also a way to work with a seller who might prefer not to drop the price, but is open to other terms.
If you’re upfront with the bank and they allow the second position loan, it can be a win for everyone.
Conclusion
You don’t have to sit on the sidelines just because the market feels uncertain. If you can spot opportunities that others are missing, if the deal actually works at today’s terms, and if you’re willing to get creative with your financing, now might be exactly the right time to buy. It comes down to knowing your numbers and being willing to act when others won’t.
Having a dedicated buyer representative on your side can be crucial when finding the right real estate investments in uncertain times. Our experts can guide you when evaluating properties and negotiating terms to ensure you’re getting the right property for your strategy. Contact us today to learn more about how we can help.
