The real estate market reacts to worldwide uncertainty, to large impacts on the economic markets and to changing attitudes residents. It is fair to say that the pandemic has achieved all three of these markers and that is why real estate is going to see sweeping changes in the coming years. We have already seen a fork in the road with regards to real estate since the pandemic hit, with so many projects being cancelled and prices wobbling all over the world.
The reality is that not many experts have a perfect prediction for a post-pandemic view of the real estate market, but some like Javier Burillo have been speculating on what we may see take place.
Learning From China
Despite the outbreak originating in China, it is fair to say that they have well and truly quelled the virus and so much of the country is back to what could be considered normal. We can learn from China with regards to what has happened to their real estate industry, following the damaging impact of a hard lockdown last year. What has happened there is that cities have bounced back very quickly and it has been the smaller, rural communities where things are still slow. Prices have dropped in cities and plummeted in smaller areas.
Even looking back on previous outbreaks such as SARS cannot really give us a clear picture here because the scale of that was nothing like what we have seen in the last 12 months. Something which most experts are predicting is that the rental market will be the one that booms, as many look to cash in on properties they can no longer afford or looking to downsize to adapt to a new economic climate.
Some in the construction industry believe that their focus moving forward will very much be on the commercial industry rather than residential. We have already seen a large number of big construction projects being cancelled outside of cities. As they adapt to survive, many of these companies will switch their focus to commercial clients, and seek to find projects within that sector.
A situation as big as what we have seen with this pandemic is going to have a massive impact on trends and the desires of the customer. It is expected that we are going to see an increase in demand for homes which have outdoor space and gardens, which have hygiene in mind when it comes to kitchen design and a bigger push in people looking to get away from congested areas such as city centers. The suburbs may very well buck the trends that we are going to city in rural areas and small towns. These trends may be short term or we could see them stay for years to come. This of course will come down to how quickly people are able to change back to where they were 2 years ago, with some sense of normality.
Where do you see the real estate market going in the coming years?