Immigration has been front and center in the news since well before the U.S. political elections last November. Now it is making headlines again with new political proposals to reduce the number of legal entrants to the U.S. from today’s one million per year to half that number, over the coming decade.
Sharply restricting immigration would result in a net negative for real estate, a group of top property advisors predicts, earning Immigration a spot on The Counselors of Real Estate (CRE) annual list of top business and real estate disruptors –The CRE 2017-2018 Top Ten Issues Affecting Real Estate– for its negative impact on housing, development, and jobs.
While the CRE professional association does not advocate or take positions on policy issues, the group of high-level property advisors practicing in more than 50 real estate specialties notes that tightened restrictions on the numbers of people entering the U.S. will negatively impact multiple industry sectors from housing to hospitality to retail.
Restrictive immigration laws, emphasizing concerns about security, and terrorism, appeal to a voter base concerned about jobs lost to illegal immigrants, the CRE report notes. At the same time, companies ranging from tech firms to real estate finance companies bemoan the lack of qualified workers; many positions in these sectors are typically filled by highly skilled immigrants.
Immigration and Housing are Intertwined
“Immigration is a dynamic source of new household formation, too” says Scott Muldavin, CRE, Chair of The Counselors of Real Estate. New immigrants tend to rent, which boosts demand for multifamily housing, especially in gateway cities,” he said.
“Immigrants also aspire to own homes, and are likely to move from cities to suburbs and back again in search of employment,” said Peter Burley, CRE, a real estate economic research executive who chaired the team that spearheaded this year’s CRE Top Ten report, “Labor mobility and home ownership rates will be constrained by limiting legal immigration.” Burley also said that decreasing population growth, often fueled by immigration, would, in effect, penalize U.S. communities with aging populations.
If that’s not enough reason to question limiting immigration, Muldavin said, “Reduced workforce numbers caused by restricted immigration would negatively impact property sectors such as hospitality (hotels and restaurants), retail (stores, online ordering and related logistics businesses), residential and multifamily development and construction, and a multitude of service industries within and outside of real estate.”
The CRE Top Ten Issues Affecting Real Estate list, developed by The Counselors of Real Estate, annually focuses on forecasting and interpreting trends and issues – the disruptors — that will have the highest impact on property and those who own, invest, plan, develop, and live or work in it. Members of The Counselors professional association include real estate senior executives and business owners in the United States and more than 20 other countries.
The full list the CRE 2017-2018 Top Ten Issues Affecting Real Estate is below. For a summary and analysis of each issue in The CRE Top Ten, visit The Counselors of Real Estate website.
The CRE Top Ten Issues Affecting Real Estate 2017-18
-Political Polarization and Global Uncertainty
-The Technology Boom
-Housing: The Big Mismatch
-Lost Decades of the Middle Class
-Real Estate’s Emerging Role in Health Care
The Counselors of Real Estate
The Counselors of Real Estate, established in 1953, is an international group of high profile professionals including members of prominent real estate, financial, legal and accounting firms as well as leaders of government and academia who provide expert, objective advice on complex real property situations and land-related matters. Membership is selective, extended by invitation only. The organization’s CRE® (Counselor of Real Estate) credential is granted to all members in recognition of superior problem solving ability in various areas of real estate counseling. Only 1,100 people in the world hold the CRE credential. For more information, contact The Counselors of Real Estate, 430 N. Michigan Avenue, Chicago, IL 60611; 312/329.8427; http://www.cre.org