The Urban Land Institute and Pricewaterhouse Coopers recently released the 2015 edition of “Emerging Trends in Real Estate.” While the report is targeted at real estate investors and developers, residential brokers can learn a great deal from the report’s market analysis and trend spotting. Below, we highlight a few national trends germane to residential real estate professionals.
The Emergence of the 18-Hour City
The report defines an 18 hour city as one that aspires toward the non-stop activity of a New York or Chicago, but on a much smaller scale. These cities, such as Charlotte, Raleigh, and Denver, are among the fastest growing in the country. They see relatively cheap housing costs when compared, for example, to those established cities just mentioned.
What does this trend mean for your brokerage, especially when you aren’t selling in trending locales? Make sure you’re aware of the positive comparisons you can make to your local urban area. Know the drive time to a popular cafe or theater, and be familiar with amenities such as public transportation, bike lanes, and parks. Homebuyers are often looking for such amenities, even when Broadway is 500 miles in a different direction.
Technology has Real Effects on Real Estate
Technology’s partnership with real estate goes much farther than Zillow and Redfin. Technology can define a city and a neighborhood. The fast growing markets mentioned above are also, and not coincidentally, home to strong technology sectors. Technology is also responsible for the obsolescence of shopping malls and the decline of uniform-use office parks.
When it comes to residential sales, now is the time to be aware of how homebuyers depend on technology. Know the answer to questions about internet providers, cell phone reception, and other technology concerns. If they can get faster internet on the other side of town, it might be worth showing them a home they might otherwise be unlikely to buy.
Millennials are Still the Market to Target
We’ve written before about the lack of a housing boom among millennials. This report does not suggest a boom either, but it does acknowledge the obvious: Millennials—tech-savvy, compromising, and indebted—are still going to make up the largest share of homebuyers in the foreseeable future.
For reasons stated above, access remains much more important to this demographic than amenities. Walkability, shopping and dining options, and cultural opportunities most associated with urban living are usually more desirable than, say, a finished basement.
But that doesn’t mean a home in the suburbs is unsellable. It just means that you have be aware of those common expectations and familiarize with what one home offers that others do not. Know, too, about the measurable value of a driveway against city parking, and prepare to answer questions about noise, pollution, and other discrepancies between urban and suburban living.