by Brianna Crandall — August 14, 2017 — Immigration has been front and center in the news since well before the U.S. political elections last November, notes a new report. Now it is making headlines again with new political proposals to reduce the number of legal entrants to the United States 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
CRE spokesmen pointed out that immigration is important in the housing market, with new immigrants tending to rent, thereby boosting demand for multifamily housing, especially in gateway cities. Immigrants also aspire to own homes, and may move between cities and suburbs in search of employment, so restricting legal immigration would constrain labor mobility and home ownership rates.
According to Peter Burley, CRE, a real estate economic research executive who chaired the team that spearheaded this year’s CRE Top Ten report, restrictions could ultimately decrease population growth, which would, in effect, penalize U.S. communities with aging populations.
If that is not enough reason to question limiting immigration, Scott Muldavin, CRE, chair of The Counselors of Real Estate, continued:
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
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 CRE 2017-18 Top Ten Issues Affecting Real Estate are:
- Political Polarization and Global Uncertainty
- The Technology Boom
- Generational Disruption
- Retail Disruption
- Infrastructure Investment
- Housing: The Big Mismatch
- Lost Decades of the Middle Class
- Real Estate’s Emerging Role in Health Care
- Climate Change
For a summary and analysis of each issue in The CRE Top Ten list, visit the group’s Web site.