When the sun finally sets on this pandemic, it may well wind up having a profitable effect on how people live in their houses in Scottsdale, experts say.
Local homeowners could find themselves with more usable space, a much higher value, and more and more neighbors from big, crowded urban metros looking for a much more comfortable place from which to live and work.
How houses will be used is changing as well, with more homes needing office space for remote work, more higher tech electronics – plus office-like backgrounds – to handle the remote meetings and distance learning, and more “hang out” creature comforts as your abode will become much more of your castle than previously. The back yard will be more important, and not just for the dog.
When barriers to working in traditional offices spaces are removed, it’s likely that a lot of workers forced to do so remotely will resist going back to the big building downtown – or in the states they fled. They – and employers – have discovered in many cases that it works just as well (or even better) under pandemic. And that bodes well for the economic health of housing in Scottsdale.
The suburbs are the new hot spot home for people who can afford to move out of expensive, crowded, disease-risky places like California and New York. That exodus trend has been in play for a few years now, but COVID-19 not only accelerated it but may have made it broader and more permanent.
“In our view, this is not new; it’s not temporary,” Jonathan Woloshin, head of U.S. Real Estate, Global Wealth Management at the Chief Investment Office of UBS, told Barrons. “It will continue as companies figure out how many [employees] will be remote full time. ”
If you can have a fabulous big home in the rolling Sonoran Desert and Scottsdale amenities for the same price as a 40-year-old three-bedroom ranch style tract home in the city and work from home, what’s your choice?
If fewer of us don’t have to drive an hour from North Scottsdale to downtown Phoenix for work and back, that powerful commute disincentive to “live close” will be greatly reduced.
The biggest advantage of that, according to a survey by FlexJobs, is dumping the commute. Some 27% of people in its survey said the pandemic had made them think about moving now that being physically close to the workplace has proven less essential to commerce. That’s good news to the former commuters who live in North Scottsdale.
“As more companies decide to extend remote work opportunities in the coming months, and as more people realize they’re not tied down to their locale for their jobs, the residential real estate market is likely to continue its shift.” – FlexJobs.
A metrostudy noted that housing prices have risen in Maricopa County because of a nation-leading in-migration plus healthy wage and job growth, and that didn’t appear to be lessening. The tourism and entertainment industry, one of Scottsdale’s prime revenue- and job-producers, has been damaged by the pandemic, but demand remains strong for health care, tech, and business services – also prime Scottsdale employers.
The National Association of Realtors reported that all 181 metropolitan statistical areas NAR tracts had gains over the last third quarter, many in the double digits. And that's expected to continue, said NAR’s chief economist Lawrence Yun.
"Favorable mortgage rates will continue to bring fresh buyers to the market," he said.
Valley real estate expert Jim Belfiore also predicts that the upturn will have legs, with new home sales at or near a 15-year high, with prices increasing 12% this year and up to 9% next year. He attributes some of that to low mortgage rates, high demand, and rising rental prices.
And expect more new neighbors.
Cost of living, housing, and taxes topped the reasons that more than half of Californians were considering leaving the Golden State, according to a survey by the Greater Phoenix Economic Council, of which Scottsdale is a member. That was followed by natural disasters, traffic, and leadership.
“The mainstay is really about housing affordability," GPEC CEO Chris Camacho told ABC10, "and what I hear oftentimes when I venture back to technology companies from the Bay Area is that you can get twice the home for half the cost.”
An effective and universally used COVID vaccine could make it possible for much of life to return to what it was, but like other culture-altering economic recessions, it will have changed how regular citizens live their lives.