New Trends Emerging for 2018
As the real estate market continues to evolve, new trends are emerging for 2018 according to Forbes. Buyers will be more in control as the housing supply will finally catch up with buyer demand, according to a report by Realtor.com. Additionally, more millennials will be looking to get out of their parents’ basement and purchase a home of their own.
Real estate agents have the challenging task of changing with the market and being responsive to their clients’ needs. Whether it is a buyer looking to purchase a new house or a seller looking to get the best price for their home sale, real estate agents will need to stay up on the trends of 2018 and be ready to respond to a growing demand for real estate.
Ten members of Forbes Real Estate Council shared what trend in real estate they predict will have the biggest impact on their business in 2018. Here is what they had to say:
Real estate experts share what to watch for.
- Co-living and Community-Driven Spaces
Co-living and community-driven residential will increasingly have a larger impact on the multifamily industry as it changes to reflect a new wave of renter demands and wants. Just as amenities have defined the last decade of commercial real estate development, the need for unique experiences and services will heighten competition.
- Short-Term Rentals
The rise of the short-term rental market has created a boom in opportunity for large property owners or the single family owner. Priorities range from renting a room occasionally for extra cash to renting entire vacation homes at three to five times the local and regional market since you now can access a global community.
- Fractional Investing
As peer-to-peer lending and crowd funding catch mainstream attention, folks looking for greater diversification and passive investment opportunities will engage in factional investing. The last few years have seen some extremely credible startups innovate in this space, and next year could lead to individuals moving away from sole ownership to fractional ownership via crowd funding.
- Smaller Living
Tiny apartments and mobile living will be a solution to increasing housing density in overpopulated areas. This will become more of a norm in big cities and will drive up operating income on existing apartment stock. This likely won’t have a huge effect on 2018, but it will over the next decade.
- New Appraisal Legislation
The new tax bill may further restrict new home-buyers from entering the market. Implementation of appraisal management company regulations in 2018 will increase costs and have the greatest impact on our business. It will increase the cost to do business, which will ultimately increase the cost to the consumer.
- The Rise of the Real Estate Investor
The stigma around the average real estate investor seems to have faded with the recession but also, the rise of the corporate/national real estate investor is happening as well. I see that niche becoming more competitive, recognizable and digitized in 2018. Many home owners won’t think twice about entertaining an investor offer alongside considering selling with agents.
- On-Demand Access for Renters
We often hear from renters that they are too busy to sweat the small stuff. They want immediate tour confirmations, like booking a restaurant on OpenTable, and near-immediate confirmation that they have leased, like booking a hotel. This real-time service expectation from a new generation of renters is exactly what we plan to cater to in 2018.
- Growth of Private and Alternative Real Estate Investments
We expect consumers will continue to invest more capital into private and alternative real estate assets, as public markets remain at record highs across all major asset classes, and comparable yield risk remains favorable to private real estate vs. higher risk bonds and equivalents.
The Rise of Micro Units
Rental rates have been increasing across urban areas for the last several years, and the most impacted cities have seen a rise in micro units. These well-designed rooms, as small as 200 square feet, maximize every square inch available. Places like The Panoramic in San Francisco and Yotel in New York have been the first to embrace the model, and we see this trend expanding over the next year.
- Millennial Buyers
I believe that the new buyers are millennials and we, as agents, need to become more proactive in the community to become that millennial choice. This generation has many different options for home ownership including tiny homes, investment homes and co-living situations with friends or family. It’s going to be a huge learning curve and a fun adventure all around!
Compiled by David WB Parker, CIO of Parker Associates of Jacksonville, Florida, marketing consultants to the real estate industry; Research Specialist and an active real estate sales professional with PARFAM REALTY based in Jacksonville, FL. He can be reached at 904-607-8763 or via email email@example.com.
Parker Associates works extensively on understanding your market, your consumer, and your goals. We don’t just make it up, we research it ad infinitum to make sure we get it right. We are your advocate by being the advocate of the consumer.
Spend time looking at what you are trying to acquire, develop, or sell to learn how you can improve the success of what you are offering. Parker Associates helps understand the consumer by answering WHO will buy, WHAT they will buy, and HOW they will buy it. When the research is completed and the analysis is done, having the answers to these questions will reveal what will provide the best success for your project. Keep asking WHO, WHAT, and HOW and keep developing to fit the need.
If all of this is difficult to understand, that’s what we’re here for. Parker Associates has a team of experts on all of this stuff and we’re here to help. It’s what we do.
Compiled By David WB Parker
Providing marketing and sales consulting services to both public and private real estate and resort developers, home builders, investors and more
Real Estate Development Marketing Consultants since 1982