With the threat of COVID-19 across the world, many people had to make the transition from working in a centralized office space to working from the comfort of their own home. As the pandemic progressed, companies began to give their employees the option to continue to work from home instead of returning to the office; they even offered a hybrid option of coming into the office some days and remotely working other days. While those of us who work from home don’t make up a large portion of the work force, it is still enough to create a shift in commercial and residential real estate.
With more people spending majority of their time back at home, their needs have changes regarding their living spaces. In the past, location played a big part in where people chose to live; they were willing to sacrifice floor space in order to be in the location they desired. Not to mention, better location meant higher prices in most cities. Now, people are looking for more space, and location isn’t necessarily a determining factor. There is a need for more space in order to have a dedicated area to working from home, and by working remotely, they don’t need to be as close to the office. This new necessity among working Americans has caused apartment floor plans to be modified. Renter’s desire a home office space, so architects have changed existing floorplans, enabling people to work from home without paying for a whole extra room.
A combination of being able to work from home and the need for more space has remote workers migrating from city centers to more suburban and rural communities. These communities are often more affordable, and they provide more floor space for what you end up paying. Cities such as New York City and San Francisco are seeing massive loss of residents during this shift to remote work. Residents will sell their home and condos within the city and take the money they’ve made to the suburbs and rural areas nearby, consequently causing a rise in home and rental prices in that area. This rise in home and rental prices can affect locals, squeezing them out of the area.
As more people are given the option to work from home, the more we will see a change in the real estate industry. With companies and workers finding more pros than cons from working from home, commercial real estate could see centralized office spaces phased out entirely. Within the residential real estate industry, there could be a severe change in floorplans for new homes being built. COVID-19 not only changed the average working day for Americans, but it created a shift what people want in the real estate market as well.
