What the Middle Class Money Squeeze Means for the CRE Industry via NREI

The American middle class is losing its hold on the reins of the U.S. economy, not only because of the drop in incomes and net wealth, but also because the commercial real estate industry is catering to the luxury and working class consumers instead.

According to a recent Pew Research Center study, the recession and the housing crisis hit the middle class hard, erasing its wealth gains from the three decades prior. The middle class is defined by the study as adults whose annual household income is two-thirds to double the national median, about $42,000 to $126,000 annually in 2014 dollars for a household of three. This group of people fell from 61 percent of the U.S. population in 1971 to 50 percent in 2015, as the group defined as upper class doubled to 9 percent of the population and the lower-income tier rose from 16 percent to 20 percent of the population during the same timeframe.

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