Remote work, also known as “work-from-home” or WFH, is a seismic shift that’s rocking the housing market. As more people trade cubicles for couches, housing preferences are changing dramatically. How can savvy investors adapt and prosper?😎
Dialing into the Data: The Demand Shift
COVID-19 didn’t just disrupt our lives; it rewired our work culture. According to an Upwork study, by 2025, an estimated 36.2 million Americans will be working remotely, an 87% increase from pre-pandemic levels. This shift is creating an unprecedented demand for homes equipped with office spaces.
In the same vein, a recent Zillow survey revealed that a dedicated office space is among the top priorities for homeowners, with demand especially high in tech-heavy cities like San Francisco and Austin. But it’s not just the tech hubs; smaller towns and suburban areas are also seeing a surge in demand, as employees freed from the daily commute are prioritizing space and comfort.
Supply Side Story: The Adaptation
So, how is the housing supply responding? In three words: Not well enough.
Despite the mounting demand for home offices, there hasn’t been a parallel surge in suitable supply. Most residential units were designed pre-pandemic, without a work-from-home culture in mind. It’s a classic case of the market playing catch-up, and in this gap lies the investor’s opportunity – and this is valuable across multifamily, single family rezzy and even short/mid-term rental.
Strategizing Success: Investing in the Home-Office Boom
As real estate investors, here’s how to capitalize on this trend:
1. Revamp and Reposition: Look for properties with potential for creating dedicated workspaces as part of each unit. A small investment in remodeling can yield significant rent premiums, whether your rents are long-term in nature or higher, but more episodic, short-term.
2. Scout for Space: With remote workers seeking larger spaces, suburban real estate is becoming increasingly attractive. Areas with good connectivity and amenities are hot spots.
3. Cater to Convenience: Amenities matter more than ever. If your tenant’s home is their kingdom, you need to make sure your property is well-served by things like high-speed internet, quiet surroundings, and proximity to grocery stores or parks. These give your home-office combo an edge.
4. Watch the Market: This is a platitude, of course – you should always be watching the market. In this case, though, you have to watch two types of markets – your regional market, of course, but also the remote-work market. As to the latter, stay updated on remote work trends and how they’re influencing housing demand. A good investor is an informed investor.
How to afford these properties? Partner with Diggifi
Diggifi finances your property acquisitions, construction and refi. We’ll finance your investments in the WFH-enabled properties, and help you turn these properties into your investment advantage.
Ready to embrace the future of work and investing? Contact Diggifi here today.📞