U.S. real estate leaders flag affordability, AI and trust as key 2026 industry challenges

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Real estate 2026 challenges

Highlights

Real estate leaders cite weak affordability, uneven demand, and rapid AI-driven technological change as critical industry challenges heading into 2026.
A shortage of lower-cost homes and rising land, labor, and financing costs continue to widen the wealth gap and impede homeownership for younger Americans.
Brokers and agents must deliver clearer value and rebuild trust as clients demand transparency following commission changes and lingering industry skepticism.

Market strain and technology reshape strategy

As reported by Business Insider, members of its 2026 Rising Stars of Real Estate say the industry is contending with a mix of weak affordability, uneven demand and rapid technological change that is forcing brokers, lenders and landlords to adjust their models.

Joey Ben-Zvi, founder of Ben-Zvi Group, says wider access to listings and market data means agents can no longer rely on basic information advantages. In his view, professionals need to show value through judgment, negotiation and problem-solving as buyers and sellers try to navigate more complex transactions.

Saharsh Chordia, vice president of strategy and analytics at Cortland, says data is becoming more important, but the challenge lies in turning fragmented property information into usable insight. Alex Dobosh of HKS Real Estate Advisors also describes AI as both a disruption and an opportunity, saying firms that integrate it into sourcing and client work are better positioned to keep pace.

Michael Dillon of Prime Finance says the growth of data centers and power-linked properties could alter the outlook for traditional asset classes. For lenders, he says, that raises new questions about how to underwrite durable demand for specific buildings over a long horizon.

Affordability pressures and shifting demand test the sector

Landy Liu, founder of Foyer, expects affordability concerns to remain a central issue into 2027, arguing that a shortage of lower-cost homes is widening the wealth gap and making homeownership harder to reach for younger Americans. He says the industry needs lower-cost ways to support first-time buyers through the purchase process.

In New York, Katherine McGrath of Kasirer says demand continues to rise across the city even as land, labor, construction and financing costs make affordable development difficult. She points to mixed-income projects as one way to address both supply and affordability, but says developers need faster approvals, zoning reform and incentives that reflect actual project costs.

Cordelia Meserow of Harbor Group International says Manhattan's office leasing market remains strong, but a shortage of top-tier Class A space is slowing transaction velocity. Steven Rivera says agents also need to rebuild trust after commission changes, as clients increasingly ask for clearer proof of value before agreeing to representation.

Other young executives say the business must adapt more broadly to demographic and land-use shifts. Selin Sonmez of Snag argues real estate products are still built for older patterns of work and housing stability, while James Williams Jr. of Gunster says developers must rethink how land is used to meet current needs for housing, jobs and services, even as zoning, infrastructure and funding hurdles remain significant.

Earlier, we discussed the 2026 Rising Stars ranking highlighting young real estate leaders navigating AI and policy changes.

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