Current Real Estate Trends

Affordable housing references a spectrum of different housing types, from a subsidized social housing for those with special needs, to transitional housing and homeless shelters. There are strategies you can follow to achieve affordable housing:

Maintain older housing stock:

*An inexpensive method of gaining affordable housing. This is commonly used in situations where there is an abundant supply of deteriorating stock.

Housing Mandates:

*It's possible to create affordable housing without assistance from the government. But it should only be applied where housing demand is very strong.

Government-sponsored housing:

*This tends to be expensive, but it is meant to serve special needs. Unfortunately, government housing can't meet the demand for low priced housing.

Unjustified Restrictions:

*Unjustified Restrictions typically decreases the costs of housing production. Which gives markets the chance to respond to demands.

Affordability:

*Affordability should take total housing costs into account. Including maintenance, taxes, transportation costs and utilities. Consider both long-run and short-run impacts.

Strategies are useful, but it is important to consider the facts, too:

Housing shortage provides opportunities:

*A rarity in today's economy could be mid-priced single-family homes of which only a handful can afford. Although margins are good for those projects, developing more affordable housing would be helpful to the community.

Are fears of recession misplaced?:

*The U.S economy will inevitably need a correction. However, experts have stated that the future will be smooth as opposed to another recession.

Gen Z:

*Gen Z, the generation born starting from 1995 to 2009, has a potential for improving the post-college housing market, similarly to millennials.

2018 Markets to watch:

*Here are a few examples:

-Seattle

Overall rank: 1

Investment rank: 2

Development rank: 1

-Los Angeles

Overall rank: 7

Investment rank: 8

Development rank: 8

-Charlotte

Overall rank: 12

Investment rank: 12

Development rank: 16

-Portland

Overall rank: 13

Investment rank: 7

Development rank: 20

Urban Fringe Development:

*While this can provide cheap housing, it tends to have high future transportation costs and high infrastructure. Urban Fringe development is only affordable in a location with ideal transportation options.

In conclusion, take your time when it comes to finding affordable housing. There are many advantages and disadvantages you need to keep in mind. Taking the time to consider all factors of purchasing a home tends to set a wiser decision.

Real Estate Trends in 2017

The real estate market has been considerably unpredictable in the past year. But 2017 is proving to be quite promising when it comes to the trends that experts have predicted for the current year.  Take a look at the following trends that are expected to unfold in the coming months:

1. Property prices will rise.

For starters, homeowners will be pleased to know that experts predict a continuous rise in property prices. Given the decline that rampaged the market in the past couple of years, homeowners’ equity is expected to increase at a constant rate of around 5 to 6 percent over the next three years.

2. Mortgage prices will rise.

With the increase in interest rates comes an expected rise in mortgage rates. Although the rise in interest rates is indicative of a strong and growing economy, it can be burdensome to existing borrowers, especially those who are considering refinancing their property obligations. The latter should lock in their rates before the closing process lest they lose money due to skyrocketing interest payments.

3. Loan opportunities will increase.

With the expected property price hikes comes a trend worth looking forward to – the increase in available loans, both from banks and non-bank sources. Getting a mortgage will become easier in 2017 with more jumbo loans and low down payment loans expected to be offered by multiple financing institutions.

As interest rates rise, the borrowing rate will decline.  This would then push banks to make an active effort to pursue new borrowers throughout the year. With more non-bank financers entering the market, property investors will gain more opportunities to make purchases.  This will also further loosen the banks' credit box, given that more opportunities for borrowing will further reduce the number of potential bank borrowers.

4. Increase in construction.

As more sizable loans become available, people’s purchasing power will most likely rise. With more individuals able to finance property investments, the demand is seen to rise across both housing and commercial property markets. This will bring forth a potential increase in development projects that are open to both local and foreign patrons.

5. Rise of smaller, more affordable home options.

And as the property market continues to shift, the changing demand will bring forth a potential rise in the development of small to mid-scale homes across the world. The market that was once satisfied only by condominium and apartment units may now gain access to other property options.

6. Foreign property investments will continue albeit a smaller role for foreign investors.

Foreign investors are always present whenever properties are available for rent or sale.  The influx of these market participants will continue to prevail all throughout 2017. But experts say that the role of foreign investors in terms of profit generation will be rather limited this time around as more investments become courtesy of local investors.

7. Ease of purchase for first-time homebuyers.

With the construction of smaller and more affordable homes comes the potential influx of first-time homebuyers who have sadly not been accommodated by previous years’ property markets. With significant attention being shifted to this new market, it is expected that the process of property investing will also be eased to entice the new market, consisting mostly of millennials, to consider purchasing or renting residential properties.

The Rise of Co-working Office Spaces

Co-working office spaces are thriving. This trend has developers looking closely at the movement. Co-working spaces generally refer to community office spaces where a variety of individuals share membership and come together to work. Members typically include freelancers, self-employed people, and even small groups of corporate employees.

Co-working is more than just a shared office space. There are specific ideals behind the movement. There is an emphasis on community, openness, collaboration, accessibility, and sustainability. Members often sign a manifesto agreeing to uphold these qualities within the workspace.

There are numerous reasons for the popularity of co-working environments. First, workers report a greater feeling of authenticity. Because there is no competition and typical office politics, people feel they can be more at ease and authentic. Most co-working spaces are accessible 24/7. This means people can work at any time, giving them immense flexibility. However, having an actual office gives them much needed structure. Many freelancers and self-employed individuals find it difficult to create necessary structure in their work schedules while working from home. The strong sense of community is another benefit coworkers find helpful.

Additionally, large corporations are investing in the use of these co-working spaces. It is not uncommon for a company to send certain individuals or groups to these spaces. It seems to help spark creativity and gets employees out of the mundane environment of the corporate office.

Real estate developers are watching this trend and beginning to realize the potential. This is a new sector that could prove to be profitable as more people work remotely and freelancing becomes the norm. Traditional office spaces may be a dying breed over the coming decades.