Despite current political and economic upheaval, as well as the demographic changes occurring worldwide, real estate remains a lucrative and relatively solid industry. No dramatic shifts are expected in 2019; however, a slow but steady transformation of the property market is already on the way.
In comparison with other investment markets, real estate is seen as a relatively safe harbour and continues to attract investment capital. According to PwC, the top cities for real estate investment in 2019 are located in:
- Canada — Toronto, Vancouver, Montreal
- Europe — Lisbon, Berlin, Dublin
- USA — Dallas-Fort Worth, New York, Raleigh-Durham
- Asia Pacific — Melbourne, Singapore, Sydney
The market is likely to be dominated by four tendencies in the near future:
- technology — new technology drives change in our modern world and directly influences how we live, work and shop;
- sustainable development — our lives are centred around property — be it a house, a school or an office building … and the demand for sustainable, environmental and people-friendly real estate will increase significantly in 2019. Materials, building-related emissions and “green” certificates are likely to make a long-term impact on property value and investment profits;
- urbanisation — it is predicted that more and more people will move to the cities and middle-income households will constitute the biggest demand for residential apartments;
- demographics — younger Millennials and Generation Z will dominate the work force in the following decades; despite a huge demand for proper housing, these generations are largely priced out of private home ownership and are most likely to rent long-term or buy an apartment.
A wisely chosen property location is only one part of an astute venture. It’s equally important to know which types of real estate investments are most likely to pay-off. A potentially lucrative segment could comprise of alternatives. The 2019 outlook report from the Nuveen real estate investment firm advocates alternatives as comprising tomorrow’s core real estate. Some market segments, such as retail and luxury apartments, are too often replete with empty properties, whereas in other sectors there is an urgent need for more quality construction — student accommodation and senior residences are the most telling examples.
Last but not least, property users themselves have gradually become more and more important within the real estate market. The days when buyers and tenants were considered little more than cash cows are drawing to a close. It’s more vital now than ever to provide people with positive and memorable living and working experiences, to ensure that properties correspond not only to general quality and safety standards but also fulfil our deepest desires for our homes and urban environment.
Across all sectors, there is an increased risk of accelerated obsolescence of buildings and the only way to overcome this is to create a friendly and cutting-edge urban environment. In order to succeed in the real estate market in 2019, it’s vital to integrate technology and sustainability as well as to understand the needs and wishes of those to whom real estate matters the most — the urban dweller.