What is the future of real estate?

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‘The crystal ball is pretty murky right now,’ says the forecast

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Wondering how the real estate industry will emerge from the pandemic? All the others too.

Even a highly respected industry forecast has decided that “the crystal ball is pretty murky right now” thanks to disruptive forces that have created both opportunities and challenges.

Emerging Trends in Real Estate 2022, an annual report jointly conducted by PwC and the Urban Land Institute (ULI), says that housing affordability is a key issue running through many trends, the most important of which are the impacts of a changing world of work.

“Environmental, social and governance, digital accelerations and changes in the workforce are all mega trends that will continue to have a transformative impact on the industry,” says ULI CEO Richard Joy. “Working together to find creative solutions to these challenges will allow real estate leaders to shape the future and discover new opportunities.”

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CHANGING THE WORLD OF WORK

There is little doubt that the workplace will emerge from the pandemic almost unrecognizable. “Most employees are still hesitant to return to the office, indicating a preferred hybrid arrangement even in a post-pandemic world,” says Frank Magliocco, national real estate leader for PwC Canada.

“When PwC Canada asked Canadian workers about their ideal work arrangement, the most popular option, selected by 36 percent of respondents, was to have an equal division between face-to-face and remote work, while only 10 percent He chose a traditional work environment in person, ”he says.

As that change takes hold, owners must address the purposes a physical workplace will serve and make their spaces more attractive to workers. Although Canada still has some of the tightest office markets in North America, a lot of uncertainty remains.

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Some homeowners are hedging their bets by incorporating residential components into office developments to create mixed-use sites, according to the report. Some employers are upgrading their spaces, while others are reconfiguring their offices to create spaces as “gathering areas” that allow for collaboration and team meetings.

MIXED USE COMMUNITIES

The changing world of work is also having a major impact on the housing market. As has been widely documented, remote work created opportunities for many Canadians to move from the main centers of the city center, where offices were generally located in favor of the suburbs or even another province.

The implications of a changing world of work are not just about where people choose to live, but what kind of communities they want to call home. If more employees want jobs that allow them to work from home or have shorter commute times, realtors need to pay even more attention to the trend toward building mixed-use communities with nearby retail services and offices.

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That goes beyond transit-oriented communities, which are being embraced by Canadian municipalities and which often include mixed-use considerations from the start. These considerations should also apply to single-family neighborhoods in major urban centers, suburban communities, and secondary cities that typically have incorporated less diverse uses.

Meanwhile, concern about housing affordability across the country continues to grow and not just in larger cities like Toronto and Vancouver, but in smaller centers as well.

NEW APPROACHES

The time has come for new approaches to the housing market. Changing the rules to allow more than one unit or kitchen in a single-family rental home or allowing smaller lot sizes could improve affordability.

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Medium-density housing options, such as mid-rise buildings and townhomes on major urban boulevards, which are widely described as the ‘missing middle’, could also offer more affordable options, according to the report.

Industry players are calling on various levels of government to work together to find solutions. On the one hand, the federal government is helping drive demand for housing by increasing immigration.

On the other hand, provincial and municipal policies make it difficult to build new homes. Industry players also want to see better incentives for developers to book more low-cost units.

Single-family rental homes are spinning around with no clear consensus on whether this south-of-the-border trend could take off in Canada. Some believe the land costs here are too high for the numbers to work, while others think it is an option in some regions to address the desire for more living space while offering more affordable alternatives to buying a home. Single family, particularly when those rental homes incorporate more than one unit.

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What about condos in a post-pandemic world? Initial fears that people will avoid the condo market as a result of the impact of the pandemic seem unfounded, as the market continues to grow in Canada. Although some developers are unsure about starting new projects, multi-family housing is widely recognized as a strong category within the industry.

How will purchases change?

Retail may never be the same again, predicts the report Emerging Trends in Real Estate 2022. Temporary cookouts will become a permanent feature.

People will continue to pick up groceries and other items they buy online, so retail centers need to be reconfigured to provide more space for pickup.

Some retail owners are stepping up their efforts to attract different types of tenants, from gyms and healthcare clinics to seasonal pop-up stores, as well as events and entertainment.

In an attempt to further increase foot traffic for retailers, some are even seeking zoning changes to bring other uses into the mix, such as condos instead of parking lots.

The best bets in the Canadian real estate market include warehousing and fulfillment, home rentals, and uses related to healthcare and life sciences.

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Reference-torontosun.com

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