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CREFC sentiment index hits lowest level in three years

CREFC said 92% of respondents expect mortgage and cap rates to weigh negatively on CRE finance businesses.

Reported · Written up by our desk · Industry

The CRE Finance Council (CREFC) said its Third-Quarter 2026 Board of Governors Sentiment Index fell 17.5% to 83.3 from 101.0 in Q2, marking the lowest reading since Q3 2023’s 82.7, according to ConnectCRE.

ConnectCRE reported the decline was broad-based, with all nine core questions weakening quarter over quarter, led by drops in interest rate and economic outlook questions.

ConnectCRE said 92% of survey respondents expect mortgage and cap rates to weigh negatively on CRE finance businesses, up from 53% in Q2 and the most negative reading since Q3 2022.

ConnectCRE also reported 62% of respondents expect the U.S. economy to perform worse over the next 12 months, up from 24% in Q2 and the highest share since Q1 2025.

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