Are you a realtor, and you’ve been searching for the trends in the real estate industry or you’re a real estate investor, a homeowner, or just a curious individual who’s been surprised about the new ways through which transactions are done in the post-COVID-19 era? Then this article is for you.
Some top cities dominate the real estate industry concerning strong growth, homebuilding outlook, affordability, and job prospects. The cities are; Durham, Berlin, Nashville, Tokyo, Charlotte, Frankfurt, Singapore, Amsterdam, Seoul, Osaka, Paris, amongst others. However, the emergence of Covid-19 has changed the modus operandi of real estate businesses. Investors' demand and city rankings have taken a new form as there have been consistent demographic shifts. Also, the way realtors do business, how people buy houses, and even how properties are rented are experiencing a lot of changes. It becomes pertinent to harness the virus spread and develop sound response policies. Some of the areas that have experienced new trends in the industry are below:
Office/Work From Home (WFH) Sector
The COVID-19 has disrupted people’s lifestyles and influenced trembling economic changes. Before the COVID era, working at the office used to be the order of the day, though more companies adopted the WFH work style after the pandemic. The post-COVID period has witnessed the main change from working at the office to working from home. This has raised a concern about the lessening appeal of long commutes in big cities and the increasing concern for the health and well-being of employees. These issues could affect leasing activities in the years to come, as many remote workers now consider migrating from major cities to more affordable, spacious places like suburbs.
There is an increase in the investment rate of residential abodes and residential markets. Aside from the fact that people want more livable space because of the pandemic, many investors have increased their allocation to residential areas for several reasons. One of these reasons is that many see investing in real estate as a stable income provider. Another is that investing in housing is fulfilling in society (since it is one of the basic needs for mankind). Hence many interviewees predict favorable supply-demand dynamics, making investing in housing a prudent defensive policy for the foreseeable future.
Growing Interest Rates
This is probably the most threatening impact on real estate. Rising interest rates by banks will affect home sales as well as getting finance. Therefore, banks usually lend at 2%, but this cannot continue as demands increase on real estate.
High Demand for Experienced Agents
With the intense competition in the real estate industry, only experienced agents will thrive. Many clients are growing savvy. So, only very experienced agents carry out transactions.
In conclusion, I trust that this article has satisfied your curiosity. When embarking on your next real estate transaction, ensure you consider these factors.