Technological, social, and economic challenges of the future will change the way people live, work, and shop. These changes can significantly impact today’s climate, not just in residential, but in the commercial real estate sector as well and its portion of the value chain. The ultimate question is who will profit and who will lose money in the future world of commercial real estate.
What can we expect?
The present evolution of technologies towards digitization and automation will cause massive changes within the industry. The job profiles that exist today will change, along with the clients’ demands on how the job is executed. There will be an increase of redundant low-skilled, blue-collar workers while, white-collar jobs will be more driven by data, performed remotely, which will impact the need for office spaces, as well as functional office design and furnishings. These developments promise to reshape the commercial real estate environment.
The future is mobile
With autonomous cars just around the corner, we can expect major changes to the ways cities are built and developed. Property managers will have to evaluate how they use space. The decreased need for parking spaces both on and off the street will free up large areas for development. In some cities, landlords are converting parking space into commercial real estate, taking advantage of the premium location and street-level access. The new space requirements will include re-configured parking solutions for driverless cars and warehouses for automated loading machines.
Tenant health and wellness
As global environmental concerns are gaining momentum, people are more concerned about the impact of commercial spaces on their health and wellness. A global 2016 survey by Deloitte that targeted the Millennial population showed that young professionals consider employee well-being as one of the most important qualities of a workplace. To meet these demands, companies are considering how to improve the health and well-being of their commercial tenants and residents. The overall prediction is that commercial properties that don’t meet the needs of modern tenants won’t see modern tenants. The survey analysis recommends that real estate companies should include tenants in decision-making, so they can better understand design elements that cater to health and wellness.
Rise of smart energy products
With the UN predictions that the world population will reach 9.7 billion in 2050, over 66% will live and work in cities. As a consequence, commercial places will have to become increasingly urbanized with unprecedented integration of smart technologies, drones, autonomous vehicles, and automated services. The modern urban architecture will rely heavily on smart energy products like industrial lighting solutions shown here, as well as on data and technology to make life more comfortable. As a result, the cost of both commercial and residential real estate is expected to rise in those districts.
3D printing
We won’t have to wait long before builders are able to print entire floors with immense time savings. In China and Dubai, there are already low-rise commercial properties being developed with 3D printing, and the builders are reporting construction time reduced by 70% and cost by 80%. With its huge implications for construction, 3D printing is both a threat to traditional warehousing, as less space will be required, but also an opportunity for retailers to respond on-demand.
Event-driven shopping
The rapid increase of online shopping will further reduce demand for retail real estate assets, with more demand for just-in-time logistics. Amazon is already experimenting with drone delivery service, claiming it’s much safer and faster than going through couriers or postal service. This way, logistics centers could be located at the periphery, freeing more space in the city center. Upper-end high street miles will still exist, primarily through the leisure PR function, but smaller retail businesses in decentralized regions will suffer the heaviest blow. To meet the demands of new customers and build interest, shopping malls will need to resort to more event-driven concepts that emphasize on experience rather than shopping.
Fading relevance of real estate brokers
As individual market players in the real estate arena, real estate brokers will become increasingly redundant due to market transparency policies and automated rental negotiations between owners and lessees. Real estate transactions will be based on technologies like blockchain, which eliminates the need for the middle-man. On the other hand, the government won’t miss an opportunity to benefit from new developments through new tax models, such as a tax for automation. Part of this income will be much needed for mitigating social problems due to increased unemployment, which is a result of automated processes. Although the future banks will certainly take advantage of the high degree of debt financing for real estate projects, crowdfunding platforms will take their share as strong competitors to traditional banking.
The word ‘smart’ has changed slightly in meaning over the last decade, as new technologies granted us even more features that help us manage our lives. The increasing automation of running the business will bring profound changes in the commercial real estate sector, that go far beyond smart buildings and shared workspaces.
If you’re in the market for a home, here are three reasons why fall can be a great time to buy.
- Motivated Sellers
Sellers who have been unsuccessful are now ready to negotiate. This is the time to work with your experienced agent and make the right offer for you on your dream home!
- Less Competition
Back to School season is over and what that can mean for you is more options to create your dream home!
- The Holidays are Right Around the Corner
So are the opportunities to get all the financial impacts on taxes in – you may encounter a seller ready to sell and close by year end. Also – everyone is looking towards holiday planning and may just want to be done dealing with the property. You may even get an incentive if you are willing to close the deal faster than other buyers.
Today’s Mortgage Rate
Refinance Rates at 2.75% APR 15 Year Fixed.
Buying a home is so confusing. First you figure out how much house you can afford. Later comes the mortgage. Learn how to get the best mortgage rate starts with knowing the answers to these questions:
Get a fixed rate or ARM?
Mortgages have fixed interest rates or adjustable rates. Fixed-rate mortgages lock you into a consistent interest rate that you’ll pay over the life of the loan. The part of your mortgage payment that goes toward principal plus interest remains constant throughout the loan term, though insurance, property taxes and other costs may fluctuate.
Interest rate on an adjustable-rate mortgage can change over time. An ARM usually begins with an introductory period of 10, seven, five or three years, during which your interest rate holds steady. After that, the rate may change periodically.
Should I pay points?
Discount points are fees borrowers pay to reduce the interest rate on their mortgages.
And if you pay discount points, you typically shell out thousands of dollars up front to save a few dollars every month. It takes several years for the monthly savings to add up to where they exceed the initial amount paid. This break-even period varies depending on loan amount, the cost of the points and the interest rate. It’s often seven to nine years. If you don’t plan to have the loan for that long, it’s a good idea to skip the discount points.
What are the closing costs?
Closing costs are fees charged by the lender and third parties. Closing costs don’t affect the mortgage rate but they do have an impact on your pocketbook. Closing costs usually amount to about 3% of the purchase price of your home and are paid at the time you close, or finalize, the purchase. Closing costs comprise various fees, including the lender’s underwriting and processing charges, and title insurance and appraisal fees, among others.
Any first-time home buyer programs?
Before you settle on a mortgage, find out if you’re eligible for any special programs that make homebuying less costly. Many states offer help to first-time home buyers as well as repeat buyers.
Comparing loan offers
- Apply for a mortgage with multiple lenders. The more you shop, the more you save.
- Shop for loans within a set window of time. The three big credit bureaus encourage you to shop around.
- Compare closing costs using the Loan Estimates. Each lender is required to provide a Loan Estimate form with details of each loan’s terms and fees. The Loan Estimate is designed to simplify the task of comparing mortgage offers.
If you think that only affluent individuals invest in real estate, you cannot be farther from the truth. The prospects of potentially hefty earnings attract people of different financial statuses and all walks of life and the best part is – they are all welcome.
Anyone can join the real estate business since there are different ways to join the game and not just how you think big real estate companies operate. To help you find the most suitable method, here are a few simple ways to achieve success in the real estate arena.
Go with a rent-to-own agreement
Rent-to-own is an interesting manner of acquiring a property you like at a more convenient moment. You rent a place and sign an agreement that after a predetermined period of time you will purchase that property. As agreed, a percentage of those monthly installments become a down payment on a mortgage. This is especially suitable for those who need time to improve their credit score so they can use that predetermined period to do that. Other benefits include that you agree on the price at that point so any subsequent rise in the price of real estate properties will not affect your agreement, as well as having the opportunity to get to know the neighborhood and both bad and good sides of the house before you purchase it.
Purchase a vacation rental
Many people dream of owning a property on the seaside so they can rest there during the summer. And even more dream about renting the said vacation property and earning from it. The idea is simple: you purchase a property at a tourist-infected location and rent it. However, you might want a vacation rental at some luxurious destination but that can be costly. So, when choosing the location, you need to account for the potential income in the future and how you would advertise the place. For instance, you might choose a trusted online platform such as Airbnb. You can create a profile, post property pictures and communicate with tourists via this platform and you also need to take into account the service fee which is deducted each time a booking is completed.
Transform a charming fixer-upper and sell it
Perhaps the most traditional real estate investment is purchasing a property under market value, fixing it up and selling it at a higher price, and this process is called flipping houses. However, for somebody who hasn’t got much experience, it can be quite tricky to assess which of the properties is worth investing in since the cost of fixing it might surpass its value. In this case, you might want to consult with an experienced real estate consulting firm because they can help you to make the optimal choice based on customized reports as well as offer legal advice during the purchase procedure. This step by step service might also include performing a detailed property inspection and provide you with various interior design ideas so that your fixer-upper can reach a good price.
Consider real estate investment trusts
To invest in Real Estate Investment Trusts (REITs), you don’t need to purchase a property. REITs are companies that invest the majority of the money into real estate and their profit depends on it. You buy shares at a REIT which means you are not in charge of collecting rent or emergency repairs – you don’t need to have any contact with the tenants whatsoever. As a shareholder, you need to know that the income comes in the form of dividends. This type of investment offers more opportunity for portfolio diversification because any major repair of one of the properties you rent out can be detrimental to your budget. If you find this strategy interesting, you should look into thriving REITs and purchase shares with them.
Test your resourcefulness with wholesaling
This type of real estate investment doesn’t involve that you invest anything or purchase a property which makes it appealing to many. Wholesaling a house means that you are contracting a seller that has an undervalued house on the market and then quickly selling it at a higher price than they asked for it. Your profit comes from the difference in the prices. However, wholesaling demands a lot of patience and different skills because it is neither easy to find sellers who are eager to sell a distressed property nor is it easy to find an interested party quickly. Although it is not for everybody, the end profit can be quite lucrative.
And now that you know that there are many types of real estate investment, it is time to opt for one that suits you and sail on the tides of real estate success!
Many homeowners and even real estate agents looking to flip a property tend to focus solely on the interior design of a house or apartment. While there is absolutely nothing wrong with sprucing up your interior and decorating it for comfort and beauty, it’s important to remember that the value of your property and its overall aesthetic appeal will be largely influenced by its curb appeal and highly useful house extensions like garden storage sheds.
Whether you’re trying to restore your property to its former shining glory or if you’re trying to upgrade it to maximize its value in the real estate market, the curb appeal will have a leading role to play. With that in mind, here are the four excellent ways you can improve the curb appeal to breathe new life into your home.
Start some ways away from the house
Curb appeal is not just about the quality of the paint job on the porch, or how beautiful your front garden is – it’s also about those distant elements you never even think about. You see, curb appeal starts some ways away from your property, at the furthest point from which people can see your house. This is usually, you guessed it, the curb at the far end of the street. This is where you need to start.
Inspect this area closely and look for any unsightly elements that might be hindering the aesthetic appeal of your property. Move the trashcans somewhere else, and look for any irregularities in the pavement such as potholes. Now work your way slowly towards the house and fix everything that needs fixing before you move on to the property itself.
Invest in some beautiful landscaping
Landscaping is one of the best and most effective ways to elevate the aesthetic appeal of your home’s exterior, and an excellent way to increase its market value at that. However, it’s not just about maintaining a tidy lawn or removing wild shrubbery on occasion; no, landscaping encompasses the calculated use of natural elements to frame the design of the entire property.
Some of the best low-maintenance design ideas for your garden and landscape, in general, include high-rise plants, trees, artificial grass, water features and ornaments, beautiful rockery, stepping stones, and more. All of these elements should work together to frame the design and lead the visitor on a beautiful path towards the porch and the house itself.
Join the LED revolution
The way you light your home’s exterior can make or break the entire aesthetic design of the property. But beyond pure aesthetics, outdoor lighting needs to be functional, as these features need to last a long time. This is why the LED industry has grown so much in the US in recent years, and across the globe as well. In Australia, for example, electricians specialize in outdoor lighting that boosts curb appeal aesthetics and functionality.
Down Under, homeowners spend a lot of time under the stars, on the front porch or enjoying quality time with their family on the front lawn in the evening, hence the need for an experienced electrician from Inner West to design the external lighting scheme using LED lights to illuminate the entire property and at the same time accentuate key features. Follow the same mindset and invest in LED lights yourself, and don’t forget to illuminate everything from the walkway to the front porch and all other outdoor areas on your property.
Rejuvenate the exterior with new paint
And finally, there’s nothing quite as refreshing and rewarding as the look of a fresh coat of paint adorning the exterior of your home. Repainting the walls and other features such as the front porch and the fence can help you elevate the value of the property in an affordable way, but most importantly, make the property feel more inviting and homier as well.
Depending on the size of the house and the scope of work in general, it shouldn’t take you more than a weekend to repaint the walls, the window frames, the porch, and fence. While you’re at it, be sure to upgrade all of the hardware and don’t forget to replace any corroded wood you might find – it will prolong the lifespan of the element and elevate the aesthetics in the process.
Final thoughts
The curb appeal is the crucial factor that will either deter or invite homebuyers to check out a property. What’s more, the curb appeal of your home has the power to influence your mindset and shape your perception significantly, making you feel positive as you’re approaching the front door. Be sure to tend to these quick-and-easy tips, and you will have created a beautiful curb appeal that will make your home that much more valuable.
