The research firm’s top property economist likens the decline in office demand to what malls have experienced over the last six years—and sees a similar outcome.
The research firm’s top property economist likens the decline in office demand to what malls have experienced over the last six years—and sees a similar outcome.
So while GDP growth reflects national economic progress, it doesn’t necessarily ensure improved welfare for all citizens, particularly in light of the increasing income inequality seen in many societies.
Challenges related to demographic shifts, notably aging populations in Western countries, can further exacerbate these issues, potentially leading to wage stagnation and straining public services. However, immigration, especially by young, educated individuals, can help mitigate these demographic challenges. These immigrants contribute significantly to the economy, the labor market, and notably to the tax base, which can help alleviate these pressures.
Young, educated immigrants often contribute more in taxes than they receive in public services over their lifetimes. This positive fiscal impact can be channeled into public services and infrastructure that benefit all citizens.
In terms of real estate and housing, it’s important to understand that the housing market is influenced by a myriad of factors beyond immigration, including interest rates, building regulations, local zoning laws, and broader economic conditions. While increased immigration could theoretically drive up housing demand, it’s just one piece of a complex puzzle.
Further, the broader economic benefits brought by immigrants, like strengthened public finances and economic vitality, can indirectly alleviate housing concerns. For instance, the taxes paid by immigrants can be invested in public infrastructure and affordable housing projects that benefit existing residents. Additionally, the economic activity stimulated by immigrants can drive investments in residential development, potentially increasing housing supply.
Therefore, while concerns about housing demand are valid, they need to be contextualized within the broader economic and policy landscape. Immigration and real estate markets interact with each other, but they also operate independently and are shaped by a multitude of factors. In this regard, it’s essential to leverage the economic benefits brought about by immigration effectively to ensure they benefit all citizens, including in areas like affordable housing.