Real Estate Issues – 5 Main Issues Affecting Property Business in 2020


Knowing the main issues in the property industry will be a strategic move before starting a career in the real estate business. The Counselors of Real Estate have recently found emerging issues that will cause significant impacts on property business this year. 

So, what are they? Well, here are 5 prominent real estate issues that are predicted to affect the property business in 2020.

#1. Infrastructure


More than 50% of respondents join in the survey conducted by Counselors reveal that infrastructure will be one of the most important issues found in the real estate industry. They also underscore the urgency of infrastructure repair and modernization. Infrastructures such as railways, tunnels, bridges, and roads are still believed to be given a greater frequency of repair. 

Better infrastructure is also believed to be a great support for economic growth in the United States. At the same time, property values, both commercial and industrial will be strengthened to create more sustainable growth.

#2. Technology Effect


It can’t be denied that today’s technology has infiltrated all aspects of business, including property business. The Counselors of Real Estate in May 2019 stated that technology will drive all aspects of the real estate industry. They include building operations, leasing, valuation, capital markets, brokerage, use of space, and more. The use of the latest technology in the industry will make the actual location of a property business less crucial. 

You also need to keep in mind that the property industry adopts a different type of technology if compared to the other businesses, making it one of the important real estate issues. The technology in the property business now uses the Internet of Things (IoT). These include blockchain, artificial intelligence (AI), digital twin, analytics, and big data.

#3. Public and Private Indebtedness


You need to keep in mind that property is a business that utilizes debt as a tool on a regular basis. Studies reveal that there are $3 debts on average for equity dollars in the property investment in the United States. The indebtedness across the US economy is also divided into 3 different categories. The first one is the impacts given on markets. These include real estate markets the current low rates are expected to rise. The second category is the debt burden faced by both individuals and households in the United States. 

Today, the non-revolving debt in the country is known to rise 5.% or about $2.995 trillion. Meanwhile, the third category is unfunded future liabilities in the public sector. The unfunded public sector in the US is believed to be a huge redistribution of wealth. These issues are known to affect the real estate business in the country.

#4. Capital Market Risks


One of the main real estate issues you should know is the capital market risks. Every transaction in the property business, both debt and equity, are used for refinancing and acquisition of the current existing investment. They usually depend on liquidity given by active participants in the capital markets. 

As you know, many things in the real estate industry such as global and domestic infrastructure can’t be accomplished without the effective leveraging of the existing capital options.

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