Commercial RE does march to a different beat, but that difference is generally about timing, not direction. Commercial RE in this region didn’t enter bubble territory until a couple years after the residential markets were in full swing. So far, most of the commercial markets haven’t entered into decline.
But they will go into decline, sooner or later, because they’re still subejct to the same economic forces that residential properties adhere to.
During the last downturn the different commercial market segments took a beating, some being hit worse than others. I expect the same thing to happen this time, and to at least the same degree as what happens to the residential markets.
The biggest difference between the two markets is that a home really does provide shelter and a given populace does require a certain amoung of housing. Businesses can die off or go dormant, and nobody is going to subsidize their continued existence by way of social entitlements.
BTW, the reason a 4-plex can qualify for residential financing is because it’s classified as a residence. Unless that 4-plex is your domicile, you will not qualify for a residential loan at the optimum rates; at least, not without committing some mortgage fraud. You’ll be an offsite investor and will be subject to those underwriting criteria.
