How are new trends, business rules, and other factors changing today’s real estate market? More importantly, how can you use the new rules to your advantage?
Some things may never change, but it is very clear that some things have already changed. So how has the real estate landscape and business changed? What does that mean for buying, selling, renovating, building, and investing in real estate today?
You Can Live Wherever You Want
We enjoy more freedom to live wherever we like. Expect this freedom to expand in the future. This is largely thanks to the “work from home” movement. If you can work from anywhere, you can live wherever you want, provided there is a decent internet connection. This will increase on a global scale as countries become more competitive, and battle each other to attract the best workers. In Europe, borders have already become so porous that you can work, live, and get medical treatment in any country you choose. This will dramatically change the landscape. People won’t live where they have to. They can migrate to the weather and lifestyles they love most. So what destinations might see the most fallout, and the most demand? The only caveat here is where destinations restrict access by limiting affordability. Just look at New York.
International Investment
It’s becoming easier and more attractive to invest overseas. Some will do it for visas, residency and to hide wealth. Others for diversity, and some just because they want to own property in their favorite vacation spots. Expect more people to purchase properties out of their respective country in the next eight years.
Multi-Generational Housing
There is a good chance that we’ve just begun to see the tip of the iceberg in multi-generational housing. Once Millennials get back on their feet and can afford to move out of mom and dad’s house, the concept is likely to stay around. They’ll be having grand-kids of their own sooner rather than later. With so many retirees poorly prepared for retirement, many parents may be moving in with their kids. Unless those parents are heavily investing in real estate now, they may never get ahead. Unless mortgage financing loosens up dramatically, we’ll also see this is a necessity, and more money will be pooled within families to purchase real estate. Properties with extra suites and separate entries will command higher premiums.
Technology
Real estate technology is now a sector with multi-trillion dollar potential. This applies to residential housing, business property, and the real estate business itself. In fact, if there is one thing which keeps the tech industry from popping, it will be its applications in real estate. The smarter your properties are, the more appealing they may be for all potential buyers, renters, and investors. Even if you are on a tight budget, look for affordable, DIY options for integrating tech into properties.
Environmentally Friendly
Expect green to become the norm, not just a marketing and branding tool. Anticipate continued regulation that makes being environmentally friendly a must. This will apply to properties themselves, as well as real estate businesses. Unless you have a green model, expect to feel the pinch. Some ways that this could have a far bigger impact than many realize is when new rules are implemented to conserve resources, overseas manufacturers try to go green, efforts are made to preserve nature, and inefficient and harmful properties are made more expensive by taxes and new fines.
Ease of Controlling the Media
It’s so easy to manipulate the media today. We’ve seen completely contradictory real estate statistics published by the same news outlets in the same day. We’ve seen urban myths about a massive migration to urban micro-living, while home buyer surveys and transaction data shows that even millennials want the traditional American Dream of a house with a yard. So be prepared to be buffeted by competitors in the media. However, know that you can use it to your own advantage too.
Personalization
Just as marketing, products, and devices have become more customizable, expect personalization to invade real estate in a big way. This has been ranging from custom front doors and mood lighting to virtual home staging. Expect consumers to demand even more personalization ahead.
Predictability
Even though the real estate market and landscape is changing significantly, it is also becoming more predictable. Ask your average 18 year old construction laborer and they can probably tell you all about real estate cycles, timelines, and even zoning challenges. We have access to more data than ever before. Where there is more knowledge, there is less risk in real estate. Just don’t ignore the facts, or stop learning.
