Covid-19 has drastically affected the world and continues to change how people adapt to this new normal. The pandemic has also changed people’s lives, especially regarding how they invest their money.
The way people go on with their daily lives, how people work, and how companies continue to operate despite economic issues are some significant shifts society has faced. Moreover, every industry has been affected by the global health crisis, including real estate. The real estate industry has seen the impact of the pandemic. It is one of the industries that was greatly hit and affected.
After years of dealing with the pandemic, how has real estate investment shifted globally? For one, it is something many people consider, but because of Covid-19, changes have occurred, driving hesitance in real estate investment. Although this is the case, the real estate industry has slowly been picking up and getting stronger.
Changes in Real Estate Investment
People may conclude that nothing good happened in the real estate industry because of the coronavirus crisis. However, that is not the case since there have been some positive changes that may benefit people.
Below is a shortlist of the notable changes in how Covid-19 affected real estate.
1. It opened up many opportunities
Industries such as BPO and IT-BPM are some of the growing businesses in the country. Along with the Philippines being a top tourist destination, these three industries drive the real estate market to its limits.
Some areas in the Philippines are the target of investors. Provincial cities like Cebu are ideal real estate investment locations because of their metropolitan-like lifestyle. It is a prime location for tenants and investors looking for potential investment properties outside Metro Manila.
Additionally, the rising population leads to increased demand for residential and mixed-use properties. This population increases benefits local and foreign investors considering the Philippines’ market. Pair that with the country’s developing economy, and the cons of investing are minuscule. Some expats choose the country to start a new life or a place for retirement. For this reason, there are some location that increased their value.
2. Technology on the rise
Despite Covid-19 ravaging the world for the past two years, technology advances with touchless technology and air monitor systems.
These primary inventions play a vital role in numerous commercial and residential properties in a post-Covid world. However, it is not just these technological advances that change. The streamlining process for on-site construction has also changed, with additional documentation and reporting required.
This benefits investors because it allows them to analyze and track changes, leading to better decision-making when evaluating investment targets. Some developers focus on adding technology to their properties. This is a great feature for those who want a touch of modernity.
3. Flexibility and growth
A major concern in real estate is if assets will lose a part or all of their value, especially since there are different types of properties for investment.
A strategy to help investors in this situation is adopting a hybrid approach, like how businesses have conducted their office work, mixing an in-person and work-from-home setup.
The strategy involves a “flex and flip” model, which consists of the backing redevelopment of a building. It helps increase occupancy rates and revenue before selling the properties.
In terms of flexibility, it will be more crucial for new construction projects. Having a space and development project that can quickly adapt to several needs may attract more occupants and investors. Some real estate development targets families, while others target the working class or career people. One can choose the amenities of the property based on your needs.
4. A growing interest in the Philippines
At the start of the pandemic, the Philippines’ real estate market suffered a huge blow but has since slowly recovered. International businesses have taken an interest in the Philippine real estate market, as many have settled in the region and established offices in other parts of the country.
Aside from Metro Manila, other cities outside the capital continue to thrive. Places with low labor costs like Davao and Cebu have several international offices. As the country continues to get its vaccination rate, other global prospects may choose to establish themselves. Foreigners are seeing the value of investing in the country for several reasons. They are not only investing in properties but also starting a business as well.
Finding the Positives in Negatives
Everybody knows that the pandemic has significantly impacted society. It is why several businesses shut down, and the economy drastically dropped. It is best to always look at the positives even if the situation is full of negativity.
As the world slowly recovers, so do the industries affected. Real estate investment in the Philippines is gradually returning, and only time will tell what changes are coming to the industry.