What's going to happen to real estate after lock down?
The global market will change for sure but how and how much is the big question? Here are some comments from friends and business associates.
Business travel & hospitality segment.
One consistent comment is that during the lock down people have got used to and comfortable with video meetings and will be reassising the requirement to travel with all the associated cost and time required. So one aspect that could occur is a reduction of travel and hotel utilisation. For now I'll leave the reader to extrapolate the probable effects.
Another change that could occur with the increase of the use of the internet could be an increase in home working with the consequent reduction of the need for office space. Will this lead to reduction of the amount of office space required and a consequent reduction of office rents? Again I'll leave the reader to do their own forecasts, but in UK only 1/3 of desks can meet 2m distance requirements.
We have become more used to shopping on line while shops are shut so what proportion of this trade will not return? Again I will not speculate on percentages but I believe it could be significant.
Restaurants and bars.
We don't dine or drink out principally because its comfortable but for social interaction and new experiences so once the Corona fear dissipates we will probably be even keaner to socialise. The queues outside fast food joints and coffee shops for takeaways once the ban was lifted could be an indicator of a surge to come for restaurants and bars.
With online trade and shopping continuing to expand the need for warehouses can only get greater. A good business to be in.
My direct experience with both Ukraine and Spain is that sales prices have stopped increasing during the pandemic but rental prices have dropped considerably as people have put moves on hold and holidays are canceled. However this is only while the pandemic restrictions apply after which the market will quickly recover. An interesting opportunity could be that people will be seeking larger homes as the need/desire to work from home increases.
For 3 probably not good news and for 3 possibly optomistic.