A large and sprawling office complex was once a sign of a robust and successful business. Due to current trends of remote work spurred by the COVID-19 pandemic, however, the future of office commutes and shared office spaces is changing.
Even though some companies allowed staff to work remotely before the pandemic, working from home has become the new normal. According to Review42, nearly 55% of global businesses offer some capacity for remote work and 18% of the workforce telecommutes on a full-time basis.
How does this affect real estate? The move toward remote work has changed how and where people want to live, and the housing market is adjusting accordingly.
The Connection Between Remote Work and Real Estate
Working from home raises considerations for those who are new to it. Is there enough room to work comfortably? What about a workspace for a partner or spouse? Some workers have young children learning remotely, too.
Some employees are deciding that they don’t need to live so close to the office since they’re working from home. The added flexibility has opened up the option of moving out of apartments and houses in the city to larger and quieter spaces in the suburbs. Homes are becoming more than just a place to eat, relax and sleep — they’re becoming the space for work, learning and recreation, as well.
Renters are benefiting from the new normal of virtual officing, as well. According to Zillow, remote work could make homeowners of about 2 million renters who can now afford to buy residences where real estate is more affordable.
Zillow economist Jeff Tucker noted that remote work could increase the opportunities for homeownership, but only time will tell. He said, “It’s unclear how many people would make the move to buy their first home. Proximity to work is just one of the factors people consider when choosing where to live. Other factors may keep them from moving including proximity to friends and family, cultural and natural amenities, and their kids’ schools.”
What’s Next for Offices?
Is this the end of the traditional office spaces? Some experts seem to think so. As businesses hear the petition from their employees about a more flexible work schedule and a well-rounded work-life balance, employers are adjusting. According to research, more than 20% of workers have considered leaving a job because of long commutes, and over 27% of people consider their commute as wasted time.
While telecommuting is not beneficial to everyone, 77% of those who work from home have reported being more productive than they are in a traditional office setting.
Real estate brokers recognize that businesses are no longer searching for the big office complex for their employees. Some companies are offering a network of less traditional, smaller workspace options for those who prefer to work outside the home by combining a short and easy commute with a collaborative, professional environment. Those in real estate must be ready to morph and change with the times to provide a comfortable workplace in a home or other small-scale space.
Learn more about Longwood University’s online Master of Business Administration in Real Estate track program.
Sources:
Magazine US: The Impact of Remote Working on Commercial Real Estate
Review42: 28 Need-to-Know Remote Work Statistics of 2021
Zillow: Nearly 2 Million Renters Can Become Homeowners, Thanks to Telecommuting
