Philip E. Goforth of Missouri is a construction and real estate development professional. In the following article, Philip E. Goforth discusses how real estate is one of the key indicators of economic growth.
The industry plays a pivotal role in stimulating economic growth by creating jobs, attracting investments, and fostering sustainable communities. New real estate developments introduce capital into local economies, produce tax revenues, and encourage increased commercial activity; all of which contribute to the area’s overall prosperity.
Philip E. Goforth of Missouri says that real estate has been, and continues to be, the foundation of middle-class wealth accumulation and a vital factor in the flow of income, goods, and services for millions of Americans. According to the National Association of Realtors (NAR), real estate accounts for about 17% of GDP, which makes the industry a major driver of the U.S. economy as a whole.
Philip E. Goforth of Missouri offers an analysis of the relationship between development and economic prosperity, focusing on the impact of real estate in the growth of an economy.
Philip E. Goforth Explains How Real Estate Affects Economic Growth
Real estate accounts for a large portion of both individual wealth and business wealth across various economic sectors; this alone has a major impact on the economy. When real estate prices increase, wealth also increases, resulting in more spending and borrowing.
Furthermore, real estate itself is highly prevalent. It makes up a large portion of the construction and retail sectors, it is a farmer’s most valuable asset, and it plays a major role in many other sectors. So, when property prices rise, it creates a ripple effect across the economy.
Philip E. Goforth of Missouri provides more ways real estate impacts the economy:
New real estate developments, new construction projects, and increases in property value all create a positive impact on the economy. They are also indications of growing economic activity.
Philip E. Goforth of Missouri says that the increase in infrastructure developments and construction projects not only boost employment opportunities in the construction sector but also creates demand in related industries like manufacturing, retail, and transportation, which further fuels economic expansion.
As previously mentioned, the real estate sector generates a substantial number of employment opportunities across many industries, including architecture, engineering, construction, property management, and surveying.
Not only does this multifaceted job market bolster employment rates, but it also promotes career opportunities and skill development within the industry, resulting in a strong workforce. Furthermore, it also generates indirect job opportunities for the service sectors and supply chain, which amplifies its positive effect on job creation and growth.
Another way that the real estate sector contributes to economic growth is through tax revenue. The government collects taxes in different forms – sales taxes, property taxes, and real estate taxes on real estate transactions.
Philip E. Goforth of Missouri explains that the revenue collected from these taxes is essential for funding education, healthcare, public infrastructure projects, and other essential services that strengthen the entire nation, both socially and economically.
Real estate development generates a demand for infrastructure like public transportation, bridges, and roads, all of which boost economic growth.
The expansion of urban areas requires a constant flow of new real estate projects, which in turn drive up investments in transportation networks and utilities. These new infrastructure developments also appreciate in value over time and attract businesses, which further stimulates economic development in that area.
Philip E. Goforth of Missouri says that a healthy housing market encourages job creation, consumer spending, and credit growth, which positively impacts the economy. In addition, a healthy housing sector creates a wealth effect, wherein homeowners have the tendency to spend more because they feel financially secure, which stimulates economic activity in various industries and contributes to an exceptionally positive economic cycle.
The real estate industry provides small towns and various societies with infrastructures and land for hospitals, which improves healthcare access for communities in underserved areas. This also reduces the burden on healthcare facilities in larger cities, resulting in improved healthcare outcomes.
The establishment of new medical facilities in rural areas also generates employment opportunities and attracts healthcare professionals to the area, which further stimulates the local economy.
Tourism and Hospitality Sector
Hotels, vacation rentals, and resorts play a crucial role in boosting the tourism and hospitality sector.
Philip E. Goforth of Missouri reports that this expansion not only generates job opportunities in the hospitality industry, but also attracts both local and international tourists who will spend money on dining, accommodations, and local attractions.
Indeed, the real estate industry is closely intertwined with the growth of the economy. The multifaceted contributions of the real estate sector are evident in various industries and facets of society. As real estate continues to evolve, it remains a pillar of support for the development and prosperity of nations worldwide.