How the real estate industry is changing and what to expect in 2023
Right now, there is a great deal of technical disruption happening within the real estate sector. It is set to radically change the real estate profession as well. Research has shown that it is not just brokers that will have to prepare for this, but the entire industry. If you want to know more about how the industry is changing or what you can do to try and prepare for it, then the only thing that you have to do is take a look below.
A new kind of consumer
Photo by Binyamin Mellish
According to research, the sharing economy could generate a huge level of revenue going forward. The sharing economy is essentially where people borrow or rent goods as opposed to buying them. This kind of development is going to take money away from the traditional business of real estate. Most of the time it is younger people who drive the popularity of this sector, but in 2022 it looks like AirBNB has a huge role to play as well. If you look at the other end of the spectrum, then you will see that ageing societies are going to change the way that we see real estate too. it is important that we do whatever we can to try and cater to the needs of an older population by providing new ideas for accessible facilities and assisted living. This helps to create a much safer environment and it helps to keep the elderly out of hospital for as long as possible. Of course, one thing to know is that consumers are becoming far less predictable and a lot of the time, real estate is driven by psychographics. This means that investors have to take into account interests and general attitudes over financial data. Of course, chartered building surveyors & valuers are also going to have to adapt to the new types of property surges in the market.
Urbanisation
There is now a bigger need for affordable housing. Urban infrastructure is also very important. From transport facilities to telecommunications and more, essential projects like this are not usually carried out unless there is a good amount of funding. If you look across all sectors, you will see that there is a gap, and this means that one-third of urban dwellers could well struggle to find decent housing by the year 2025. If you look at rapid urbanisation, then you will see that this is currently having significant environmental and health effects on urban communities across the world. Social tensions and housing prices are going to increase, and the sense of community is going to diminish. The real estate sector is ideal for finding solutions here. Developing new concepts could well help here. While a lot of attention is being paid to concepts such as urbanisation, it is important to understand that the fabric of city life is deteriorating. Strong telecommunication, such as high-speed internet is now a priority along with affordable energy. This is helping to guide real estate activity more than anything else right now, and it also helps to reinforce the need for close coordination for infrastructure planning and land use.
Jobs and skills
If you look at the Pew Research Centre, you will soon see that they have done a survey on the job skills that people have right now. Most of the people who took part in the survey think that within the next 5 decades, computers and robots will be doing a lot of their work for them and that their own job will experience a substantial impact. If you look at optimism bias, then you will soon see that this can be seen in the real estate industry. Robotic devices are going to be able to perform a lot of tasks and they are going to be able to do this far more efficiently than humans too. Digital tech is going to change the employment market and it is also going to have a huge part on organisational structure. Entrepreneurs will have to do what they can to create their own jobs too.
Automated systems are going to need a much higher skill level just for entry-level positions. Of course, when you combine this with income growth you will soon see that it is going to be more associated with educational and skill levels. Growing competition is going to be an issue as well. Employment growth in the service industry is going to continue well into the future as well as we transition to a much more knowledge-based economy. Changes like this are going to have a huge impact on those who work in real estate.
Real estate as a solution
If you look at the World Economic Forum, you will soon see that the real estate sector has now consumed well over 40% of the energy in the world. There is a projected increase of 56% increase in CO2 emissions and this is going to happen by the year 2030. There is going to be a 7% increase in global emissions by the year 2030 as well. The real estate industry is going to be under a big obligation to try and change this as well as showing leadership where possible. It is going to be up to the real estate industry to show future generations how important it is to try and be as active as possible in pursuing positive change.
Location is everything
Business innovation is going to be redefining the real estate space. The need for office space is changing and improving dramatically and studies have shown that even traditional office space is now being disrupted. Interconnectivity is going to be increasing more and more by the year and this is going to mean huge things for the industry. Of course, nobody knows what the future is going to hold but right now it would seem that there is going to be a lot of positive change across the board.
Of course, the real estate industry is changing more and more by the day and it would seem that a lot of positive change is going to come in 2022.
