Commercial property markets throughout the world continued to expand and strengthen in 2005. By year-end 2005, average rents had increased in nearly all property sectors in the US, and vacancy rates were trending down in almost every property type.

The retail and residential sectors will continue at full speed ahead, the report predicts with "ever higher quality homes" being built to satisfy growing demand and more retail development to meet consumer demands. These sectors will be "extremely robust" over the next three years, as homes destroyed by Katrina and Rita are rebuilt. Despite 13 consecutive increases in the Fed's overnight rate over the last 18 months, there is little sign of any slowdown in activity reported by NAI Global Members. This performance is fully expected to extend through 2006, with rents continuing to trend upwards and vacancies to slowly tighten.

Retail demand still led the way in 2005, with the industrial market mixed and the office market showing a strength not seen in several years. Little speculative development is evident and nearly all key international markets were cautious as well, reacting to the current global situation and uncertainties over interest rates, the price of oil and the weakness of the dollar.