How did the real estate market fare in the wake of the pandemic that captured the better half of 2020? In the following sections we will look back at 2020 market trends that will play an important role in shaping the real estate market next year.
Greater Inclination Towards Suburbs | Gains for Warehousing | Uncertainty Surrounding Office Space
At the beginning of the year, the housing market experienced a slowdown due to the pandemic. However, the market bounced back in the second half of 2020 in most of the regions and is expected to stay active for rest of the year due to lower inventory levels and pent up demand.
The spring market stretched into the summer months and created a strong market that remained the same across different market segments.
Greater Inclination Towards Suburbs
Many home buyers are looking toward rural and suburban parts of the country as an alternative to living in metropolitan cities. The suburbs are also becoming a preferred choice due to the space they offer and the affordability.
The need to work from home and search for affordable homes outside dense metro cities is increasing demand in suburban locations that provide more space to work, live, and play.
Gains for Warehousing
In the realm of commercial real estate, the retail sector faced problems while the warehousing industry experienced gains. The lock down negatively impacted the retail industry while the pandemic boosted already expanding eCommerce sector and paved the way for increased demand for warehousing space and distribution centers.
Uncertainty Surrounding Office Space
For many it is still not certain when they will be resuming work from their office in the near future. There are some assumptions that people want to maintain their social connections and as such, workers will be returning to office soon enough. However, there are others who are happy and comfortable working from home, which has given them an opportunity to connect in different ways with their peers and family.
Real estate trends with respect to office space will also depend on companies and how well they utilize available digital capabilities to facilitate remote working for their workforce. The decision they take will play an important role in evaluation of the real estate portfolio they will have.
Demand for medical office space is expected to grow as there is always a requirement for physical space to provide needed care to patients and also for installation of diagnostic equipment. It is also anticipated that the gradual shift towards virtual care will result in some amount of re-purposing of office space available for medical purposes.
We can say that the real estate market saw quite a bit of an upheaval in the first half of 2020, but it bounced back in the second half of the year and soared. We expect a busy 2021!