When the Pandemic first started, many people worried that a housing crash was imminent. However, throughout 2020, the real estate market has remained surprisingly stable. Most of the stability is due to the ongoing need for single-family homes. How is this affecting real estate development as a whole? COVID-19 has caused a few distinct changes to development plans.
Plans for New Development on the Decline
In general, real estate development has slowed down a bit. Current projects are still being completed, but many investors are shying away from new development plans. With all the uncertainty right now, fewer people are interested in launching a new project. Those willing to go ahead with a new development plan may find themselves outpacing their competitors.
Mid-Sized Cities With Outdoor Space Are the Hottest Market
Pricey metropolitan regions like New York City and San Francisco have had a marked slowdown due to COVID-19. With the option of working remotely, more and more professionals are choosing to move to areas with a more affordable cost of living. The biggest draw on the market right now seems to be mid-sized urban regions known for having a pleasant climate and plenty of access to nature and outdoor entertainment. Richmond, VA, Tampa, FL, Sacramento, CA, and Denver, CO are all showing significant growth.
Growing Need for Industrial Commercial Space
With many restaurants, bars, and shops struggling, a lot of commercial real estate is on the decline right now. However, there is one area where there is a growing demand for commercial real estate. Almost everyone has transitioned to online shopping, and retail experts believe this trend is here to stay. Big box stores are already in the process of building more warehouses, packaging, and delivery centers to address their customers’ new needs. Creating industrial developments may fulfill a major market need right now.
Affordable Housing May Be a Rewarding Market
With a massive number of residents unable to pay their rent, the Pandemic has greatly exacerbated the need for affordable housing. Most developers prefer targeting the luxury apartment demographic. However, there are a lot of helpful subsidies and grants available to those willing to create affordable housing. Developers may find this market to be surprisingly affordable.