2019 has ended and with the first month of 2020 coming to an end as well, it is a wise decision to rile-up your brain into thinking, where to invest in real estate in 2020? The rest estate industry has been standing at the brink of transformation. The transformation that will bring about economic and social change. With numerous people migrating from one country to another, it is crucial that our real estate torchbearers plan for the developmental shift. The cities will begin to swell, and we may also have some new cities.
According to a report by PwC here are six predictions that will potentially change the real estate landscape:
- Broader spectrum of risks will emerge along with new risks. Be it political risk, climate change, or behavioral change, all these risks will have to address.
- Prime assets will intensify further. The real estate community will have to think laterally to get better returns.
- Collaboration with local government will become important. Real estate professionals will have to collaborate with the government to risk schemes and other uneconomic situations.
- Sustainability and innovation of technology will be the key driving factors. Every real estate property will require a ‘sustainability’ rating. Technology will bring forth disruption for real estate economics, making a certain segment of real estate obsolete.
- Rapidly expanding cities will pose a greater risk and return opportunities. With great construction surge comes greater risk, that needs to be addressed.
- Expansion of global real estate investment. Given that our population and GDP are increasing year on year, so will real estate.
So far, this is a positive growth that we are all looking forward to in 2020. So, what places will be the best places to invest in? According to the ULI and PwC report called Emerging Trends in Real Estate 2020, the professionals have ranked the top 10 places:
Austin, for the longest time, has been one of the hotspots when it comes to property investments. It brings a rich talent pool, popular yet different lifestyle, and its ambitious outlook towards expanding towards real estate. The city is backed by a strong economy, which means extremely well-paid jobs, especially after Google, Apple, and multiple other technology firms decided that Austin is the place to be, thereby opening a portal for job seekers. Going by this information, Austin is set to witness a spur of population growth in the coming five years.
Also, on the downside, the report by PwC has also highlighted some of the drawbacks. The city comes with numerous traffic issues and rising prices in the real estate market. As compared to other similar cities, Austin has lower supply levels. Taking these points into consideration, the property prices are going to see a surge. Therefore, for all the potential investors, it is time to start buying or leasing property in Austin, sooner rather than later.
Yes, Boston is a smaller metro market and also has a steady yet slow population growth as compared to the other cities. Despite this, Boston has witnessed steady economic growth. Boston has always been known for an expensive real estate market in Massachusetts, but that has never slowed down the buyers and sellers. This city houses some of the best educational institutes with some of the popular technology industries functioning here.
If we look at the rest of the country, Orlando stands on top when it comes to the unemployment rate and increased job growth. With thriving tourism in this city, and topping the charts of being the most visited cities in the country, it makes Orlando the best cities for real estate investors.
As per the PwC reports, Raleigh-Durham has witnessed an impressive real estate performance in recent years. The city houses multiple educational institutes, some notable universities like Duke University, North Caroline State University, and many such smaller educational institutes as well. Also, Raleigh-Durham has what is known as the Technology Hub (Research Triangle Park). Ranking third after Silicon Valley and San Fransico, Raleigh-Durham ranks third when it comes to finding the best technology-related jobs in the country.
Raleigh-Durham introduces good market fundamentals and a diverse economy, which makes it a good prospect for real estate investors.
One of the most attractive investment options for real estate investors—Nashville. One United States’ largest metropolitan city, Nashville also brings forth the lowest unemployment rate. Another positive indicator to invest in this market is to know that the market here is rapidly growing, with the ever-growing population.
Nashville also remains as one of the popular tourist destinations, with over 10 million people visiting each year. This means, that for real estate investors it is a good market to invest in holiday rental commercial properties. However, for investing you also need to have a valid permit. Therefore, before you go all out to make sure that you have the logistics in place.
A city that is rich in employment, tourism, massive development projects, Seattle also makes it to this list for the real estate marketers. With the ever-growing market, Seattle will continue to remain the best place for real estate investors in 2020. The expansionary mode of this city means expansionary mode for real estate investors.
The diverse economy of this city is backed by its technology, infrastructure, and manufacturing industry, making it the best market for commercial real estate investors. Also making it an ideal place for people to live and grow. Currently, Charlotte is experiencing a lack of supply, which does make it difficult for investors to work with. Also, as an investor, you would have to plan a better investment strategy so that you can offer the best deal to the clients in the city.
7. Dallas-Fort Worth
The city comes with up and coming job opportunities, which acts as a magnet for all the job seekers. This suggests that for real estate investors this is the hot market that they should be investing in the coming year. In spite of the low supply rate in the city, Dallas’s commercial real estate market does seem to be slowing down, making it a good investment scenario.
Atlanta boasts and contributes to investor confidence. With a productive environment, successful reinvention over the years and unique culture, Atlanta surely ranks higher in the investment market. All commercial real estate marketers willing to invest in properties, this city should also be considered.
9. Los Angeles
A strong economy that brings more than Hollywood. A city that brings economical growth from tourism, aerospace, and technology industry. Los Angeles is one of the most competitive markets for real estate investors. But, this also means a higher price for in terms of selling or leasing your property. The fast-paced city never slows down, so if you are looking for a speedier growth, the Los Angeles market is the best place for real estate investors.
Now, this comprehensive list gives a sense of the best markets to invest in for the year 2020. There are also some things that you should consider when it comes to implementing your real-estate strategies:
- Think global. When it comes to real estate, the local market does give the edge to a lot of people, where local knowledge plays a big role. It is also important that real estate professionals should look at global expansion, where you will be exposed to bigger opportunities.
- City economics. All the cities with one another to reach the top will give a much bigger platform to investors for earning rewards, but it will come attached to some risks. Deploying an urbanization strategy will highlight the risks involved, but you will still need a realistic view as to why the city should be successful.
- Technology and sustainability. This will give rise to driving the real value towards real estate. If the real estate specialists fail to realize the potential in this, it can prove as a disadvantage to them.
- Collaborate. Collaborate with the local government for enabling social and economic progress. When it comes to working on massive projects, collaborating with the government can help mitigate the risks in advance.
- Where and how. It is important to find where the competitive advantage lies. The intense competition will force all the real estate investors to consider the competitive advantage. Focus only on the markets that you understand.
Today, everything is working in favor of real estate investors. The demand for good commercial properties is increasing, which is reconfirming the need for your real estate investors to hunt for the ideal property. Good relations with the local body, extensive local knowledge, and expertise in the domain is all that you need to achieve your goal in 2020.