From closures and restrictions caused by the COVID-19 pandemic to the subsequent economic crises all around the globe, the shape of real estate truly was unstable and uncertain during the last few years. But as the world is slowly returning to its normal operations and our lives continuing at the same pace, the outlook does look a bit brighter for the real estate sector. New social and political changes for the better are having quite a positive impact on real estate, opening the possibility for new trends and tendencies to appear, and presenting some hope in an otherwise challenging environment. As we approach 2022, here are some of the most important real estate predictions you should expect:
The housing market continues to grow
In what was described as the ‘housing boom’, we have already seen a steady increase in prices, possibly the highest growth in recent history. Remote working opportunities combined with lower mortgage rates caused by recession encouraged many to attempt to find the perfect home, including the younger generations who weren’t quite as fortunate to invest in homes sooner. As a result, prices quickly skyrocketed and are only expected to grow throughout the following year. While some predict increases of over 13%, others believe there is still plenty of uncertainty going into 2022, especially when it comes to such a competitive and turbulent housing market.
Short-term rentals are still prevalent
The last few years have seen a sudden increase in the popularity of short-term rental properties. As work-from-home mandates forced many to move out of urban areas and back into their rural homes, short-term apartment rentals became necessary, mostly in the form of units rented in large hubs like New York and Los Angeles where apartments were needed for conducting business in the city. However, travel has had a significant impact as well. From inner-city apartments to family homes in the countryside, short-term rental units were mostly preferred among travelers as well, likely due to the higher safety and security they provided during the uncertainty of the pandemic. Until the situation significantly improves, however, this is unlikely to change.
Long-term rentals gain new priorities
In terms of long-term rentals, on the other hand, individuals are now looking for more elegant, finely furnished, and high-quality apartments. As they consider longer leases to be an investment, the properties have to match the renters’ high expectations. This is especially true in Texas, where beautiful apartments for rent in Abilene are becoming increasingly popular. Apart from all the comfort and convenience of a great home, these apartments tend to offer additional amenities such as swimming pools, fitness centers, pet parks, and prime locations as well, thus truly providing everything a modern renter could need. Although these expectations might seem unusual, they are the new norm we can anticipate in 2022.
Retailers will opt out of new locations
While shopping malls were clearly struggling even before the coronavirus pandemic, the novel situation truly presented a devastating blow. Due to the crisis, many retailers were forced to close down stores and declare bankruptcies, in turn leaving vacancies to fill in a number of malls and centers. And shopping centers might face similar difficulties in 2022 as well. This time, however, the issue doesn’t lie in financial challenges as much as it depends on the rise of e-commerce and the need for retailers to invest in optimizing current business operations rather than expanding their physical locations. With big-box stores drawing in more customers each year as well, shopping malls will likely continue to struggle going into next year.
Leisure travel will keep hotels alive
As already mentioned, a high percentage of travelers are opting for short-term rentals, particularly families seeking higher safety measures. But when it comes to those still going for more traditional hotels, it seems like they are currently the backbone of the industry. With the pandemic halting usual business processes, corporate travel was and still is at a decline. This has significantly affected the hotel industry during 2020 and 2021, particularly in cities like San Francisco and Washington, DC. However, leisure travelers could truly spring some life back into the sector come 2022, and that’s great news for investors who had a shaky past few years with the hospitality industry.
Office buildings will become fuller
Ever since the beginning of the COVID-19 pandemic, offices around the globe have mostly sat vacant. But with the situation slowly stabilizing in some locations and the availability of vaccines increasing in others, that is quite likely to change in 2022. Many companies are already bringing employees back into physical offices, and many more are going to put a stop to remote working and demand in-office work at least a few days a week in the following months. Considering this fact, 2022 looks like a good year for office buildings, not only filling up old ones, but possibly encouraging the development of new complexes as well.
In such challenging and unstable times, it’s difficult to accurately predict the future of the real estate. While only time may tell what 2022 will bring, it will be interesting to see how these predictions unfold as the new year approaches.