The real estate market can be really unpredictable as it constantly shifts and trends come and go. This is the very reason why it’s important to always keep an eye out for upcoming and even reemerging trends that can make an impact. When you know what to expect, you can make well-informed decisions you won’t later regret. Besides, on Hipster Investment we’ve noted how investing in real estate can be fun—as long as you know what you’re getting into. Here are some of the upcoming trends you need to watch out for:
A boom in the co-op resale market
Although there have been many new projects within the downtown new development condo market, they’ve also become too expensive. This has led buyers to go back to purchasing uptown co-ops because the prices are more accommodating in comparison. It’s also important to note though that some of the co-op boards remain difficult to pass.
Home prices increase
In 2012-2015, buyers have seen a 12-15% increase in home prices within the Manhattan real estate market. The market also indicates there is currently no stopping the increase. This is a trend across all major cities.
More millennials will buy homes
In spite of the price increase and the data that shows that millennials either do not want to buy a home or cannot afford it, Susan Tjarksen of KIG CRE LLC told Forbes that the number of homeownership in that particular age group has increased. Tjarksen also notes that a number of the baby boomers who have sold their homes have contributed to the increase in renter base, while millennials make up a significant number of the luxury rental market.
Real estate will be more present online
With the emergence of social media and the increasing demand of an online presence, it’s essential for the real estate market to be available online. Diane Batayeh, the chief executive officer at Village Green, also talked to Forbes about the importance of real-time social media management and how the lack of it can impact a real estate business. If a real estate marketer isn’t available online, their business would not be able to reach over a thousand potential home investors.
There may be a rise in foreclosures
CNN Business reports that foreclosures have started to increase again for the first time since 2015 and it has been most visible in hurricane-hit cities like Houston. The number of foreclosures has also increased in expensive places like Los Angeles. However, experts note that the increase in the number of foreclosures probably isn’t a sign of an impending collapse. In an interview with CNN Business, David Dworkin, president of the National Housing Conference, said, “In 2014, what you begin to see is a loosening of the underwriting, but not an irresponsible loosening. I think we’re seeing a return to a more normal market.”
More digital tools will emerge
Artificial intelligence, machine learning, virtual reality, and blockchain are only a few of the technologies that can reimagine how the real estate market operates. Some of these technologies have already disrupted other industries like transportation and even entertainment. Several companies have already started seeing the potential in analyzing user behavior as well; prompting real estate businesses to reevaluate how they redesign their space and create a more advanced modeling system. The continued rise of AI is also worth taking note of, especially since it will give rise to better ways of building management, organization, construction, and design.
Real estate transactions will be more secured
Blockchain will change the way information is shared in the real estate industry. It can make transactions easier and safer through cryptography. With blockchain, a consumer’s financial information can be securely shared with other parties during a transaction. Blockchain can also help create a centralized financial record that speeds up transactions and property financing—not to mention how useful it is when it comes to preventing wire transfer fraud.
‘How Is Blockchain Technology Going To Change Real Estate In 2019’ on Medium notes that the real estate ecosystem can involve a lot of middlemen. With blockchain the number of intermediaries is reduced and the process is streamlined. In a featured post by FXCM on how blockchain has evolved, they explain “how it could help eliminate the many intermediaries that exist currently.” Apart from that, blockchain will also make transactions more transparent. Service fees can also be reduced, not to mention how buyers and sellers can now make use of smart contracts, which can enable both parties to complete escrows, property records (deeds, for example) to be completed without title companies or authors.
Because of all these new technologies (especially with blockchain), it may be possible for homebuyers to purchase a property with a click of a button. And it’s only a matter of time before buyers see these changes being implemented.