What will the real estate market look like this year? Luxury real estate expert Beau Blankenship shares his predictions for the luxury landscape in 2025 with real estate investors.
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As 2025 approaches, many are wondering what the real estate market, particularly the high-performance luxury space, will look like next year. Here are my five predictions for the luxury market and the overall real estate market in 2025 for real estate investors, agents, and team leaders.
Promoting development of housing projects and streamlined zoning policies
Continued deregulation of housing development is expected to make it easier to build new housing. This could include rational zoning laws and tax incentives for developers focused on housing projects, especially in suburban and urban areas facing housing shortages.
Simplifying the permitting process and reducing red tape would encourage new housing development and increase the availability of single- and multi-family homes.
Rising demand for suburban housing
In 2025, there will be a focus on tax cuts, and pro-business policies could lead to increased homeownership incentives. Demand for suburban housing is expected to surge as buyers look for more affordable living options outside of congested city centres.
With favorable tax policies, potential lower capital gains taxes, and a focus on middle-class growth, single-family homes in suburban markets are poised for significant price appreciation due to factors such as remote work, low interest rates, and affordability. There is a possibility.
Tax incentives for residential real estate investors
The return of tax policies similar to the 2017 Tax Cuts and Jobs Act is expected to bring an influx of private equity and institutional investors into the residential real estate market. Investors may be attracted to multifamily housing, single-family rental homes, and new housing developments.
Tax incentives that favor depreciation and lower capital gains taxes can increase demand for rental properties and make it easier for investors to enjoy higher returns from residential units.
Growing focus on affordable housing development
We believe 2025 could bring economic opportunity for Americans and an increased focus on affordable housing efforts. Developers could be incentivized to build more affordable single-family homes and apartment complexes, especially in areas with strong job growth.
With federal tax incentives and policies aimed at increasing homeownership, a new wave of affordable housing projects could meet the needs of growing populations in suburbs and small cities.
Infrastructure investment to drive housing growth
A renewed focus on America’s infrastructure could improve transportation, utilities, and other amenities in residential areas. This could make previously underdeveloped or difficult to access areas more attractive for new housing development.
Newly developed suburban areas and areas with infrastructure improvements are expected to see rising property values and increased demand for housing as infrastructure projects revitalize these areas. These investments will further boost the residential real estate market by making home ownership more attractive in a region with long-term growth potential.
Beau Blankenship is the owner and team leader of Blankenship Group, Engel & Völkers 30A Beaches. Connect with him on Instagram.
