Working from home (WFH) is the big post lockdown shift and we are all trying to understand its impact and outlook. Is it here to stay and to what extent? More importantly how will it impact the apartment market?
Residential and commercial real estate owners have a big stake in the game. Developers need to make decisions today about WFH trends in 2 or 3 years’ time and beyond. Apartment buyers and renters are now thinking about how much space they need (and can afford) if WFH remains part of their life.
Anecdotally, Melbourne appears to be the epicentre of WFH with a much higher percentage of people returning to the office in other capital cities.
The kryptonite to WFH may be the rising cost of living and extra real estate required to facilitate it comfortably. The cost of power, heating, cooling, travel and rents are all rising.
WFH is much more attractive if your home has a well-equipped dedicated study area, large monitors, and separation for zoom calls and other activity in the home. But if you are balancing a laptop on the kitchen table or a makeshift bench with your partner or house mate doing the same thing, the office might start to look pretty attractive.
For buyers and renters who like the idea of WFH… do they;
- Move into a larger apartment with a dedicated study (extra bedroom) even though it costs more?
- Choose an outer suburbs, larger and cheaper home (not much cheaper anymore) and incur greater travel time and cost for office days?
- Endure some inconvenience of an office set up in the lounge or kitchen for the WFH days?
- Save the extra real estate and travel cost, live closer to work and be full time in the office?
We see WFH in action every day when inspecting apartments. The WFH set up for many is well below the office environment disregarding any assessment of work colleagues or health and social impact.
It appears some degree of WFH will remain where is suits certain people and professions. People and businesses will adapt as they have to other changes in office use over the years. An apartment with a WFH facility of some sort will be attractive to renters and buyers, subject to its cost and the employment market at the time.