If you are a prospective or an existing investor in real estate, then you need to understand the evolving trends in the supply chain management as well as residential housing requirements. The age-old trends like homes with backyards as well as industrial spaces are making a comeback.
We try and understand the impact of these changing trends.
What Are the top 5 Predictions for Real Estate in 2019?
It is important for you to understand the shift in trends when it comes to real estate housing and identify the changing needs of the demography in order to take the right decisions.
Here are the 5 predictions vis-a-vis real estate in the year 2019 which could guide your decisions:
1) Feel the Urban Pulse
To invest in real estate housing, look for markets which are popular. The surmounting cost is a barrier when it comes to highly sought-after markets like New York, Los Angeles, Chicago, Philadelphia and Washington, D.C.
However, there are more pocket-friendly real estate housing options in the Central and South Eastern parts of the country like Texas, Denver and Tennessee.
There is a demand for residential-cum-retail options with amenities like gyms, shopping centers, restaurants and so on. However, there could be a shift in the trend to homes with a backyard in the suburbs by millennial’s, as they would like their children to experience the conventional joys of childhood.
2) Technology Will Be the Game Changer
As far as real estate housing is concerned, there will be new norms with regard to parking spaces allotted by developers. The reason for this is that apart from the parking requirement of the resident, substantial provisions will need to be made for ride-hailing services like Uber.
Online real estate portals too are evolving. You will no longer have to negotiate for the best deals. You will get complete information across the country with regard to the best residential, commercial real estate options in terms of demographics, geo location, price, access and space all under one roof with Artificial Intelligence.
3) Survival of the Fittest
In order to stay ahead of the game, it is very important for retail players to have both the click and portal as well as brick and mortal presence with regard to commercial real estate. They need to understand the demand of their end buyers to retain existing customers, expand their horizon and survive. There will be consolidation with only the big companies surviving.
A case in point is the purchase of a brick-and-mortal retailer Whole Foods being taken over by online retail giant Amazon. A reverse scenario took place with brick-and-mortar retailer PetSmart buying online retailer Chewy.
You need to reinvent yourself like how Wayfair, an e-commerce company, has done. It is coming up with a brick-and-mortar presence by opening physical stores next year.
With economic indicators like GDP and employment looking strong, commercial real estate is poised for growth in 2019.
4) Flexibility is the Name of the Game
Shopping habits have changed and now multiple shopping channels are the order of the day. Industrial spaces, which were in demand before the entry of big-box retailers like Walmart and Home Depot, are flourishing. They can be found near airports, highways and railway lines.
The reason for this is that shoppers are placing orders online and delivery needs to be made within a short time frame. These industrial spaces are operating as distribution and fulfillment centers. Distribution centers act as storage points for retailers, wholesaler or facilitate direct supply to customers while fulfillment centers cater to e-commerce retailers like Amazon. This changes the demand parameters for commercial real estate.
Flexibility is the keyword for office spaces in the commercial real estate market. Temporary, pay-by-the hour work spaces are in demand. Long-term leases are out.
5) Understanding Gen Z
When it comes to commercial real estate, it is extremely important to understand the constantly changing needs of Gen Z. This relates to the young generation born post 1995. They want experiences, not products.
Commercial real estate will now have to be customized in order to provide a holistic experience for Gen Z ranging from clothing to entertainment. To succeed in commercial real estate, therefore, you need to invest in mixed-use spaces.
Profit from the Changing Trends
If you want to profit from residential or commercial real estate, you need to keep a tab on the constantly changing requirements of both. From mixed-use spaces to offering retail experiences to residential housing customers, you need to read the trend and be an early mover.
So invest the right way in real estate and succeed in 2019!