Significant Real Estate Trends To Watch Out For In 2018

As the year goes on, the real estate market evolves, meaning new trends have already appeared in 2018. The year has revealed that millenials are increasingly seeking to move out of their parents’ basement and purchase a place of their own, as well as buyers catching up with buyer demand. Due to these new trends, real estate agents face challenging tasks that involve changing with the market and meeting their clients’ needs. Being aware of the new trends set in 2018 will better prepare buyers and real estate agents for the growing demand in real estate.
Crucial real estate trends to watch out for in this year are short-term rentals. Short-term rentals refer to a lease with a duration of less than six months, which are often based on a month-to-month agreement. These are common in areas with high demand and low supply of rental property as landlords can afford to be more specific about their tenants. The rises of these short-term rental markets have created a huge expansion in opportunity for large property owners or a single-family owner. The drawbacks of short-term leases would be that they offer little stability for tenants and landlords. The agreement at the end of the established period can be changed, leaving renters vulnerable to sudden increases in rent. Real estate agents and buyers need to be aware of short-term rentals in order to be prepared for the growing demand in real estate.
In addition, 2018 has brought the idea of fractional investing. Fractional ownership is an investment structure that allows multiple investors to purchase a percentage ownership in an investment-grade asset. The benefit of fractional ownership is how real estate investors who seek to unburden themselves of real estate’s T’s meaning tenants, toilets, and trash. The day-to-day reality of owning real estate doesn’t bother fractional owners; the investors can enjoy all benefits of a solid return without worrying about the labor of the 3 T’s. The last few years have seen an extreme amount of startups innovate in this space, meaning individuals might move away from sole ownership to fractional ownership.
The last real estate trend to keep an eye out for would be the rise of smaller living. Smaller living includes tiny apartments and mobile living. The introduction of this way of living is known to be the solution to increasing housing density in overpopulated areas. Downsizing is beneficial due to having a small space, which leads to cheaper prices to build, buy or rent and lower maintenance costs and utility bills. This will become more of a norm in populated cities and will bring up operating income on existing apartment stock. Not only is this trend already present this year, but it will be in the years to come which is why it needs to be watched by buyers.
In this year, the trends of short-term rentals, fractional investing, and the rise of smaller living should be watched carefully by buyers and sellers in order to be better prepared for the growing demand to come.