5 Top Real Estate Trends to Watch
February 28, 2018 |
Predicting trends in the constantly evolving real estate market is always a fun adventure! There’s always something new around the bend. This goes for commercial, retail, or residential real estate. Trends can come from anywhere. Anything from rising mortgage rates, falling home sale prices, a phenomenon like the 2008 housing bubble, to the newest trend in design.
In this article, we take a peek into the current the real estate market and discuss some of the top trends to watch for this year.
1) Housing Shortage Spurs Creativity
Studies show that baby boomers are remaining in their homes longer. High numbers of young people now looking for their first home. These trends create an opportunity for builders to get creative with their offerings. The impact of the short-term rental market (think Airbnb) has investors scooping up more available properties. This further contributes to the home shortage of the past few years. Thus, in 2018 we are likely to see more co-living, community, and multi-use spaces, as well as so-called micro spaces.
2) Growth of Secondary Markets
Top markets like New York City, Chicago, San Francisco and Seattle are becoming densely populated and continue to face price stresses. Families and singles may look to secondary markets for better real estate options. Secondary markets are essentially mid-sized cities that are in the midst of a growth spurt. In these cities, the housing market gets stronger, but remains competitive, as their growing business economy attracts more educated workers in search of housing. Secondary markets, such as Salt Lake City, Ft. Lauderdale, and Pittsburgh, are expected to experience huge growth in 2018; especially within the sphere of multi-family offerings.
3) Real-time Service Expectations for Real Estate Customers
On-demand services such as grocery delivery and online food ordering continue to expand. Similarly, renters also expect more automation in tenant services. They want up-to-the-minute service offerings. This includes online scheduling of apartment tours and real-time confirmation of lease approval, plus online payment options. No more mailing a check to your landlord. To meet the same demand by owners, mortgage lenders are moving towards online applications with near immediate approval.
4) Smaller Living Spaces
Millennials and Gen Z are looking at housing in a new way. With many in this generation having kids later or not at all, we can expect a surge in tiny houses. As well as more townhomes, condos and starter homes. Tiny apartments and mobile living are another response to rising rents, increasing density in urban areas and a growing desire by young people to travel more. Tiny apartments are rooms that may be as small as 200 square feet, carefully designed to maximize every square inch available. For single renters, a tiny apartment can serve as an affordable and practical urban option.
5) Design Change in Retail and Work Spaces
Brick and mortar stores have had to re-think their spaces to attract shoppers who are increasingly online-oriented. This includes more integration between the online and in-store experience, more incorporation of gadgets throughout the buyer journey and creating a socially shareable experience. Such as incentives for checking in on Facebook or an in-store photo op for Instagram.
Workspaces have also seen a shift towards the unique, with creative company culture and spaces designed to support work-life balance being a big focus. It will be interesting to see how Gen Z influences workspace design: Will they embrace the open plan beloved by millennials, or are they driving a shift back to structure and private workspaces?