The recent passage of Florida Senate Bill 1718 has caused a stir in the real estate market, as it is anticipated to have significant effects on the industry. The proposed legislation seeks to implement stricter immigration policies, which will impact the availability of construction employees in the state. As a consequence, it is anticipated that the Florida real estate economy and all development will be crippled in 2023. It is anticipated that private lenders and banks will cease financing real estate projects, and existing developments may default.
The Bill’s Effects on Real Estate
In Florida, a shortage of construction laborers will be one of the bill’s most significant consequences. This is because there are presently insufficient willing and able US citizens in the state to fulfill the state’s labor needs. This is due to a number of factors, including low pay and greater industry opportunities elsewhere.
As there will be fewer candidates to choose from, there will inevitably be delays in the completion of real estate projects due to the labor shortage. This will impact both residential and commercial construction, resulting in unfinished structures and abandoned construction sites. In the last week of May, it was reported that partially constructed real estate sites were abandoned due to a dearth of available workers.
The bill’s effects are not restricted to the real estate market alone. Other industries dependent on construction labor, such as infrastructure development and tourism, will also be impacted. For instance, delays in the construction of new highways, bridges, and airports will result in increased traffic and lengthier commute times. New hotels and attractions will take longer to construct, decreasing the number of visitors who visit the state.
The bill will also have an impact on private lenders and banks that finance real estate ventures. Due to the lack of construction employees, it will take longer to complete projects, delaying the repayment of construction loans. This may cause lenders to cease funding new initiatives, resulting in an industry slowdown.
In addition, current real estate developments may default because of the delays caused by the labor shortage. This will have significant consequences for investors who have already committed to the initiative, as their investments may be lost.
If other states follow Florida’s example and implement stricter immigration policies, this could have a significant effect on the economy of the entire United States. The construction industry is a vital component of the economy, and a shortage of construction employees could impede economic expansion.
Increasing wages and benefits for construction employees is one possible solution to this issue. This could increase the industry’s appeal to U.S. citizens and reduce its reliance on foreign labor. Investing in training and apprenticeship programs could also contribute to the development of a new generation of skilled employees.
In conclusion, Senate Bill 1718 is anticipated to have substantial effects on Florida real estate market and the economy as a whole. The shortage of construction employees will cause delays in project completion, and private lenders and banks may cease funding new construction projects. If other states follow Florida’s example, economic development could be slowed. However, increasing wages and benefits for construction workers and investing in training and apprenticeship programs could mitigate the bill’s negative effects.
As a real estate money lending company, we understand the importance of staying informed about regulatory changes that affect the industry. If you’re looking to invest in Florida real estate or need funding for your next project, our team is here to help. Contact us today to discuss your financing options and stay ahead of the curve with our industry insights.