The pandemic upended real estate trends. First urban rents plummeted, and then work-from-home suburban and rural areas saw huge price increases, and then the uber-competitive market continued well past the usual winter slowdown. Not to mention the rise of 3-D walkthroughs, open house safety measures, and mimimal-contact real estate transactions. Add to all that a demand for home offices and the new importance of outdoor living spaces, and things look very different than they did two years ago.
But after the pandemic ends, what real estate changes will stick around?
The most significant long-term effect the pandemic will have on real estate will be the continued great American migration from large cities to suburbs, mid-sized and small towns, and rural areas. The pandemic made possible what the housing market made necessary.
The cost of real estate in urban areas had already priced out many would-be homeowners before COVID happened. Millennials were buying houses later, the middle class was shrinking, and there was simply more demand than available homes—but because it was easier to find work in the city, people stuck it out. Many rented, others bought a smaller house than they wanted, and others became house-poor. But the pandemic created a fourth option: live elsewhere and work remotely. That option won’t end when the pandemic does.
Many employers have already outlined permanent work-from-home policies, either full-time or hybrid. It’s unclear exactly what future workplaces will look like, but for many companies, remote or hybrid work looks like the way of the future. Employees will no longer have to live near company headquarters.
Untethered, they will buy larger and nicer homes in less competitive markets. Even if a workplace requires occasional on-site presence, we’ll see many people accepting a long commute one or two days a week in exchange for greater home-owning options. Pierce, Snohomish, and Kitsap counties will benefit the most from this trend, as these areas are offer more affordable real estate, while still being close enough for the occasional long commute.
Another long-term change that’s here to stay? Home offices. Along with the need for dedicated space to accommodate long-term work-from-home situations, a rise in home offices will likely correspond with a decline in open floor plans. When most of the family stays home all day, physical separation is key to keeping people together.
This last “new normal” isn’t directly tied to the pandemic, but to climate change. We felt the heat this summer, and as climate change worsens, average temperatures and heat waves are likely to ramp up even higher.
Seattle has long been distinct for its lack of air conditioning (less than 40 percent of all homes in the city have it) but that is bound to change. Central air will soon become more common than not, especially as many homeowners spend the heat of the day inside, working remotely from their larger, more comfortable, less urban homes.