The price correction in the U.S. real estate sector is creating new investment opportunities.

The U.S. residential real estate market appears to be entering a recovery phase, driven by price stabilization and a gradual normalization of demand.
The multifamily segment stands out due to the housing shortage and sustained demand, creating more development opportunities.
Access to local information and careful asset selection are key to investing, according to KBIS.

Recent corrections in the U.S. real estate market, driven by higher interest rates and tighter financial conditions, are creating selective opportunities for investors, especially in sectors with strong fundamentals, according to KBIS analysis.

KBIS, a boutique firm that connects private capital with institutional real estate opportunities in the United States, explains that the market is entering a new phase of the cycle in which real estate assets such as multifamily, industrial, and specialized segments continue to benefit from structural demand.

This adjustment period could represent a potential entry window with attractive risk-adjusted returns, said KBIS Capital founder and CEO Luis Yanes in a recent webinar on U.S. real estate market outlook.

The value of the U.S. residential market (homes only) reached approximately US$55.1 trillion in mid-2025, a figure that includes single-family homes and other residential properties, according to recent Zillow data.

Estimates for the value of non-residential real estate, including commercial, industrial, and other assets, vary depending on the methodology used.

Nevertheless, industry analyses place this market in an approximate range of US$14 to US$22 trillion, considering assets such as offices, retail, industrial, hotels, and rental multifamily.

Despite its size and potential, investing in the U.S. real estate market involves risks that require in-depth analysis in an environment where value is fragmented and information is asymmetric.

In that context, Luis Yanes, CEO of KBIS Capital, noted that those with better information often have a decisive advantage in a cyclical and relatively predictable market that still offers meaningful opportunities. “This market is a jungle full of opportunities, but like any jungle, you need to go well guided, well protected, and well equipped.”

Market cycles

The U.S. real estate market has gone through different cycles, reflected in the Green Street commercial property price index, a key indicator of U.S. commercial real estate values.

After a stable period prior to 2008, the financial crisis triggered a sharp price decline, followed by a sustained recovery through 2020.

Following a very strong expansionary cycle after Covid, driven by near-zero rates, fiscal stimulus, cap rate compression, and sharp rent increases, inflation and the Fed’s monetary tightening have triggered a cycle reversal since 2023. Price declines have primarily affected assets purchased at high prices, overleveraged, or financed with floating-rate debt.

At present, U.S. real estate is in a recovery phase after a correction, with prices below the 2021–2022 peak, although already far from the point of greatest stress.

The correction advances

Luis Yanes, CEO of KBIS Capital, believes that the market correction has largely run its course.

In his view, there are signs of stabilization and gradual recovery, a phase that historically has offered some of the best entry points.

“What matters is that there are quite a few consistent signs that we are already in the recovery phase of the cycle, which tends to be the best time to enter the market,” said Luis Yanes. This phase is the one that “typically leads to the best medium-term risk-adjusted returns.”

Regarding macro indicators, he explained that employment in the U.S. remains stable and inflation, which was high in 2021–2022, began to come under control due to the Federal Reserve’s restrictive measures.

Last December, U.S. inflation remained steady at 2.7% year over year. Currently, U.S. interest rates are set in a range of 3.5% to 3.75%.

Yanes explained that about 35% of official U.S. inflation corresponds to the housing (shelter) component, which is calculated from surveys and tends to reflect rent increases with a lag.

According to the executive in the webinar, for some economists this approach often reflects greater inflationary pressures than those currently observed in the market.

In many cases, for that group of economists, rents grew only slightly or even declined, suggesting that actual inflation may be more contained than the data indicate.

Long-term interest rates have stabilized, while short-term rates could decline over the next two years, with possible additional Fed cuts.

These conditions support real estate investment and the potential to achieve strong risk-adjusted returns, in KBIS Capital’s view.

Main areas of opportunity

KBIS emphasized that the multifamily segment has strong fundamentals, driven by a structural housing deficit in the U.S. estimated at 4 to 5 million units/homes.

According to KBIS forecasts, this housing deficit could persist and even increase in the U.S., supporting stable demand over the horizon.

Yanes noted that unit absorption remains solid, while new apartment construction has declined, creating a favorable supply-demand balance and pointing to rent stabilization, with the potential for moderate increases in the medium term.

The roughly 50% cost difference between buying (mortgage payments plus insurance and property taxes) and renting has given rise to a new category of tenants known as renters by necessity, reinforcing demand for multifamily housing.

According to Yanes, younger populations have also changed their habits: they have fewer ties and prefer attractive, functional multifamily apartments. “They prefer to build stability through other means.”

On other sectors, he noted that offices have faced high vacancy levels due to remote work, although there are selective acquisition opportunities at reduced prices.

The industrial sector, after a period of strong growth driven by e-commerce, requires caution due to recent overbuilding, while retail, especially high-quality shopping centers, remains a defensive asset with low vacancy and attractive returns.

Investment advantages

Investing in real estate offers key strategic benefits, such as generating recurring rental income and long-term capital appreciation.

As a resilient asset that adjusts its prices and rents to market conditions, it serves as an effective hedge against inflation, helping preserve and grow wealth.

In addition, real estate typically shows low correlation with other asset classes and offers competitive long-term returns, contributing to better diversification and portfolio optimization.

This strength explains why high-net-worth families in the U.S. often allocate between 25% and 30% of their portfolio to this sector, according to figures KBIS shared in the presentation.

In Luis Yanes’ words, “it is a patient investment, not a trading investment from one day to the next, but an investment for preservation and disciplined wealth growth.”

KBIS highlighted that the main challenges for investors are access to good opportunities, due diligence, risk diversification, and tax structuring, particularly due to the impact of FIRPTA regulations (the Foreign Investment in Real Property Tax Act).

To address this, the firm offers investment structures aimed at mitigating these risks through diversified funds, partnerships with local sponsors, and vehicles designed to optimize the tax burden.

The company sees diversification options in multifamily properties and in a portfolio of selective medical and industrial buildings, both with target double-digit returns.

The strategy focuses on investing in markets with economic, employment, and demographic growth, and in business-friendly states. Diversification and disciplined risk management are pillars of the process. Asset selection prioritizes solid fundamentals and rigorous work with the best sponsors in each market, seeking the most attractive opportunities they present.

KBIS believes that the current point in the U.S. real estate cycle opens an attractive entry window, provided it is combined with discipline, local analysis, diversification, and professional guidance. For more information, you can contact our experts.

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