Real Estate Market Evolving to Accommodate Echo Boomers
In the constantly evolving and interconnected world that we live in today, it is becoming increasingly difficult to pinpoint one specific factor affecting the real estate industry.
This year at the NAR Conference in San Francisco, Scott Muldavin, Chairman of the External Affairs Committee of the Counselors of Real Estate, shared his insights into top issues that could potentially impact homeowners, real estate markets and the industry in the coming years.
Personally, Scott's analysis left little room for imagination – he dove into a wide variety of issues affecting real estate ranging from:
> an aging population
> funding of public employee retirement systems
> student debt burdens
> changing office space demand
> liquidity of real estate capital markets
> global climate change and uncertainty
> low capital rates
Perhaps the most astute word to summarize his multifaceted approach is globalization. Although Muldavin capped off his list with a discussion on rising interest and capitalization rates as the top issue implicating real estate, his predictions of the effects of the Echo Boomer generation were most fascinating. These are the 80 million Americans born between 1982 and 1995 whom, Muldavin predicts, will drastically change residential housing.
In short, housing demands will have to start addressing the needs of the Echo Boomers, who are eager to have a flexible and active urban lifestyle. As more people work wirelessly from home, office spaces are becoming sparsely populated, and the need for homes with a balance of comfortable living and workspace are increasing. People want safe neighborhoods, recreational urban spaces, and proximity and accessibility to and from work or shopping centers. The 1950's American dream of a suburban lifestyle is slowly fading – everyone wants to be close to the action!
But is there cause for anxiety? No.
It seems the real estate market is merely evolving to meet the needs of a new generation; it is by no means collapsing. Brokers and agents can expect the changing taste palettes of their clientele to reflect the larger concerns their customers are facing today – tight financial markets, climate changes, and changing work-leisure lifestyles. If you consider the Great Recession our economy was in only a few years ago, we are most definitely making strides in the right direction.
What do you think about the direction the real estate market is heading? We’d like to hear from you in the comments below.