As we enter into the late stages of 2019, understanding how the market conditions are is crucial to surviving the year in real estate. Knowing what the current situation is will help us understand whether it is financially wise to buy or sell real estate — or not do anything at all.
Below are a few real estate trends you might want to keep tabs on.
Shift in buyer demographics
Over the years, the real estate market has seen a generational shift in home buyers. As Baby Boomers and Gen X-ers continue to age, they are decidedly more cautious of their choices in homes. Instead of purchasing larger houses, they are now more partial to renting small homes or living in senior facilities. So who makes up the majority of the home buyer pie?
Enter the Millennial group. Millennials are currently aging up and are now finding more stable jobs. This has resulted in a growing need to find homes to settle down in. Millennials are now making up the largest segment of buyers, and will continue to do so in the coming years.
With that being said, selling to Millennials is different than selling to Baby Boomers or Gen X-ers. Millennials are more tech savvy, having been exposed to the internet and digital technology at a young age. Those who wish to sell homes to Millennials might want to consider transforming their property to accommodate smart home appliances.
Rise in secondary cities
Many first-tier cities like New York and San Francisco usually list properties at higher prices than the national average. This is forcing many businesses to consider setting up shop in other more affordable cities like Seattle or Dallas.
Seattle for example has slowly become an alternative to Silicon Valley, and real estate market trends in Seattle are reflecting this in the increasing demand for homes in the area. This has made many Seattle mortgage planners very happy, as more and more employees of tech companies are now requesting assistance in their relocation to the area. Transferees are asking guidance from mortgage planners on their mortgage terms, preparing the requirements and filing for a home loan for their move to Seattle.
Continued growth in secondary cities may very well increase the prices for real estate, so buyers are encouraged to make a move as early as now.
E-commerce remains a foil
Many commercial real estate owners are still concerned about the future of the retail landscape, as more and more consumers find it easier and more convenient to shop for retail goods online.
With the survival of brick-and-mortar retail up in the air, those interested in owning commercial real estate property may need to think outside of the box if they want to profit. For example, it might be wise to take advantage of the increasing number of startup companies. Places like Austin, Miami, Los Angeles, and San Francisco are all hotspots for startups. San Francisco commercial real estate owners might find it to their advantage if they transform their property into a coworking space; coworking spaces attract startup companies like moths to a flame.
There are many factors that will dictate the volatility of the real estate market in certain areas. Knowing what these factors are is crucial to making intelligent decisions that do not pose much financial risk.