A recent Harris Poll stated that greater than 65% of homeowners would consider moving to a different city if they could work from home indefinitely.
People have been leaving high density areas (particularly New York City and San Francisco but also including riot-rocked cities such as Seattle and Portland) to buy real estate in lower density, nicer, lower cost areas like Spokane, Cheney, Medical Lake, and Coeur d’Alene. Anyone who has tried to buy real estate in Cheney or the Spokane area in 2020 has been frustrated with bidding wars and houses selling within days of being listed.
With a vaccine around the corner, will the trend of employers allowing employees to work from home slow or reverse?
Employers tend to like to have employees in the office, to foster efficient communications between employees and so bosses can keep an eye on what employees are doing. Google is an example of a large company that can fairly easily allow employees to work from home. Other tech companies may follow their example.
Google has delayed when employees will be required to return to the office until September. They have stated that they will experiment with a hybrid model allowing some employees to work from home part of the week, the company said.
If other companies follow suit, this will a continuation of the trend of people leaving high cost, crowded cities. They may be more likely to move to ex-burbs, perhaps 1-1.5 hours away or a 1 hour plane right away (depending on their salaries) as opposed to moving to Hawaii or across the country.
In cities that have been rocked with riots, like Portland or Seattle, many may find it to be too high risk to live downtown. Ex-burbs are much safer bets.
Some employees, who perhaps rented houses in places like Spokane while they were allowed to work remotely, may seek out other employers who will continue to allow them to work remotely. Companies that allow remote work will have an easier time attracting high quality employees.
Until more companies announce their plans, the growth of ex-burbs seems like a reasonable bet. I also expect Spokane and Cheney real estate will continue to appreciate in 2021, though not at the same pace as in 2020. As soon as the prohibition against foreclosures ends, there will be additional inventory on the market. When the epidemic is under control and companies ask employees to return to the office, there may be a reduction in demand. We may move from a strong seller’s market towards a more balanced market. Much depends on government policies, as well as on the policies of employers, so nobody can say anything for certain, but that is my best guess.