There is a need to get bigger houses because of new building trends. Building in suburban areas is the norm according to a licensed real estate agent, Tey Yong Qing. He has been a property manager and leasing agent for more than eight years.
The pandemic caused many people to need bigger space. Real estate agents, brokers, and sellers had to change their strategies. The old method and old models were no longer working. Buyers’ tastes have gradually changed. They want enough space to play, work, rest, and entertain. They want their houses to be equipped with the essentials.
How Money Will Influence Real Estate According to Tey Yong Qing
There is an expected price increase in the sales of houses and properties. Tey Yong Qing speculates at least a 4% increase. Initially, prices were determined by those who built and developed the properties. This made buyers lose interest in buying properties. It is especially difficult for low-income earners to afford houses.
The reverse is the case now. The more the demand for properties by buyers, the higher their prices. Post-pandemic brought the reduced rate of interest, house price, stamp duties, and agent fees. Real estate firms offered discounts and special offers to attract buyers. Many buyers got interested in buying real estate. This made the price of real estate go up gradually. This is why buyers now determine the price in the real estate industry. Post pandemic real estate prices are higher than pre-pandemic real estate prices.
Companies stopped giving discounts because they need to pay wages and buy materials. Firms have deliberately increased their prices because they fear another pandemic. There is the need to expand margins and increase sales at the same time. It is speculated that buyers can still afford these prices. They can buy houses because real estate agents won’t increase the price too much.
Interests in houses and properties determine if a buyer can afford them. If the interest rate is too high, a buyer may not be able to afford it. If the interest rate is reasonable, the buyer can afford it.
Housing loans have decreased interest unlike before. Take this example. Buyer A with a 30,000 annual salary used 6 years to pay for a house of 150,000 in 2017. Buyer B with a 60,000 salary used 3 years to pay for a house of 150,000 in 2021.
It means that it took Buyer B less than six years to pay for the house. This is because the salary of Buyer B is more than Buyer A.
Housing regulations and policies have affected real estate prices. Many sellers were forced to use low interest to increase sales. The banking sector and the government gave buyers loans with small interest. The government also developed housing plans to help its people. Buyers became house owners when they took out loans or government housing plans.
Experts say that real estate will continue to thrive even if there are external issues.
Sellers who use developers that are not good have problems. The sellers are unable to sell their houses and properties. Buyers are now wise and can recognize a bad building. A poorly built building will have weak structures. Buildings with weak structures will show signs and might collapse. Once this happens, buyers will sue the sellers and developers. It will damage the reputation of those involved in developing and selling such buildings.
Developers should solicit funds from investors. Good funding will help the developers to build good houses.
Buyers want to buy properties from honest sellers. Reputable sellers have more sales than sellers that are not trustworthy.
After the pandemic, bad developers have reduced because of no customers. While good developers have more funds to do business and more buyers.
The trend for small homes and spaces has reduced. Buyers want a comfortable and large space that will suit their needs. Many work from home and school from home after the pandemic. Therefore, they want to convert their homes into small office spaces and learning spaces. Homeowners want a safe community that is enclosed and secured. Buyers do not want noisy areas. There would be distractions if they stay in those places. They want the surrounding areas to have recreation centers. Many look for houses where they can go for holidays. This is why developers need new building models that have these requirements.
Middle-income buyers are attracted to affordable large spaces with good infrastructure.
New buildings in suburban areas sell faster than those in rural and urban areas. Low-income earners can not afford urban areas but can afford suburban areas. They want houses in rural areas because the areas are not much developed. Suburbans are not as populated as urban areas. Therefore, there are more spaces for building houses in suburban areas. Large buildings are cheaper in suburban areas than in urban areas.
Tey Yong Qing advises sellers to use good developers if they want more sales in the future. Good funding attracts customers and generates good revenues.
Buyers should also think about their budgets before buying properties.