4 big real estate trends
WASHINGTON – Feb. 1, 2016 – What should you watch for this year? The Urban Land Institute (ULI) recently released its "Emerging Trends in Real Estate" report covering the U.S. and Canada.
Here are trends ULI says Realtors should have on their radar screen:
1. Rising mortgage rates
"The underlying question is how the generation whose entire business career has been shaped by a low-interest-rate environment will respond to the upward movement in the price of money," ULI's report notes. "Will higher rates alter behaviors, to what degree, and at what threshold?"
2. Generation X leadership
"They are in a good position, in a way, as they are the ones whom the boomers should be grooming for management succession," according to ULI. "But they came of age in the aftermath of the savings-and-loan crisis, in dire times for real estate. Few came into the business during the early 1990s, and even fewer have the benefit of real estate graduate education. Watch for the implications for leadership in the industry going forward."
3. The Fair Housing Act and "the affordability crisis"
Also, the U.S. Department of Housing and Urban Development (HUD) now requires local communities to "affirmatively further" equal housing opportunity. Communities risk losing federal housing funds if they don't comply.
"This could alter where affordable housing is built, and where households in need of such housing may move," the report notes. What's more, ULI predicts that given the recent U.S. Supreme Court and HUD rulings, a heated debate on multifamily development will likely ensue this year.
4. Drought impact
Also, semiconductor plants require large amounts of water, as do the snow-making machines at ski resorts. "Cities whose economic energy has been driven by population increases must confront limits on growth that are defined by water availability and cost," the report notes. "Although a strong El Niño for the winter of 2015-2016 is forecast to bring much-needed rain, the water deficit west of the 100th Meridian is a factor that real estate should watch closely in the years ahead."
Source: "Emerging Trends in Real Estate," Urban Land Institute (2016)
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