Driven by Technology: How Might Property Markets Evolve – Post COVID-19
History always reminds us that ‘technology’ powered by human innovation is one of the greatest enablers of change and there are plenty of examples. Think of simple prehistoric hand held tools and the leap to the wheel, the discovery of sail powered craft or the impact of steampower.
Then perhaps more related to the eventual birth of modern technology consider the arrival of widespread languages, the printing press or the invention of Morse code.
Today we might see technology as more aligned to space travel, computers and smart-phones, but all technology drives change and that’s very true of much of what we’ve seen during COVID-19 and how, driven by technology, things might pan-out post-COVID.
From many perspectives I think that it’s reasonable to suggest that technology has enabled many aspects of how we’ve managed this pandemic and in a very concentrated timeframe.
It was only December 31, 2019 that Chinese authorities informed WHO’s China office of pneumonia cases in Wuhan City, Hubei province, China, that were a result of an unknown cause.
While one day later on January 1, 2020 officials closed the Huanan seafood market, suspected to be the source of the mystery disease, as some of the patients presenting with the pneumonia-like illness were dealers or vendors at the market.
Today, just six months on and as we continue to navigate through and out of the COVID-19 crisis. I’m going to explore seven key topic areas, and how in particular they are or might impact property markets;
• Social Outcomes
• Population Growth
• The Economy
• The Market
• At Home
As we start to see widespread easing of restrictions in Australia, our thoughts are firmly focused on what our world might look like after this emergency is contained and it appears technology is going to be a big factor, perhaps the biggest!
Technology has already impacted the arrival and currency of the pandemic as we’re all aware of the various tracking apps as just one example and will play a central role in our recovery from COVID-19 and that’s my focus with property markets included.
Technology is the great and varied enabler; communications, working from home, mental health and screen addiction, even the swift restarting of the NRL season are all tied to technology. As a pure marketing exercise alone the NRL stands out however, however without all of the technology it would not have been possible.
Technology is key to all of these and many more trends. Greater acceptance of technology has been another positive. Assisted by technology at home, we have also moved to embrace much more self-sufficiency, with far less over-management.
There may have be some short-term pain but in the longer term there’s already evidence that more innovation and efficiency gains are looking positive aided by technology, and again much of this is happening outside of the traditional workplace and in our homes.
To enable the (continued) better use of technology, Government policy will be key. We’ve seen lots of policy changes happen quickly in the face of COVID-19 and we need more of that. Some changes have been made in days that in the past these may have taken years, even never.
Images of the National Cabinet linked by video conference are being replicated many thousands of times a day, and it’s easy to see some of our living space turned over to full screen versions moving from the limits of our desk top computers or smartphone.
Are we or have we already seen the end of the Nine to Five day. And the 5-day week, and this is also totally influenced by technology and that’s going to have a big impact on I’d suggest all areas of the property market.
The rigidity of a ‘standard’ working week will help unlock the better use of much shared urban infrastructure and this may also help reduce costs.
The apparent waste of time and money moving hundreds of thousands of people in and out of cities just looks a broken model.
We might still need core working hours, but work changes will also greatly influence the urban landscape and where some or possibly most of us choose to live and work, albeit aided by technology.
While traditional social media sites have been rapidly growing, it seems that we want to be more connected to our local community to those who live around us. We’ve grown much more interested in our immediate environment, connecting to our local neighbourhoods.
This trend is an interesting pointer to how future housing estates and apartment projects might evolve and change with greater emphasis on how community space is used.
Another big conversation that will influence the demand for property and further influence where people live, is the idea of bringing more self-reliance to our manufacturing capacity.
Supply chains will repair, but there’s possibly more room for ‘Australian Made’ this will help drive employment, but it might also drive innovation and technology, and demand for a whole range of commercial & industrial property.
However, most people are pretty conservative in lifestyle, it’s just one of the reasons self-isolation has been tough, we all like our routine.
If somebody is telling us: you shouldn’t fly, you shouldn’t or can’t go out, you may not travel or drive your car, then people are inclined to say bugger off. The big and positive change has been how people then use technology to overcome these constraints, as they are connected to work or leisure.
How and when people work will continue to change. Technology will be up-front and central. Many of the offices and schools of Australia have moved into our kitchens, spare rooms and living rooms.
Related technology is having a more profound impact on online activity driven by these changes, meetings are happening on Zoom, Google Hangouts and Microsoft Teams. There’s also increasing evidence that some employers may enlist technology to keep ‘an eye’ on employees WFH.
There are also new products that will give the impact of technology even more clout. One of those will be the wider acceptance of robot medical aids made more common and more urgent as we consider some of the worse-case impacts of COVID-19 and this may cause a change in how homes are designed. A robot medical assistance may well have particular access requirements beyond the confines of a hospital.
The idea of robots and drones delivering home shopping is now a reality, no longer a novelty.
As a society we will continue to develop, buy and sell property as we have done so for hundreds of years. There’s even evidence home will become more central, a topic for another day.
However, how we do that, how we engage a post-corona market, how we communicate appears set to change. Perhaps social structures will look very different, more connected, more local and technology is going to reshape many of our expectations.
There has already been a rapid expansion of e-commerce activity and a subsequent acceleration in the pace at which businesses are looking to transform their online and offline activities.
Consumers have responded to the pandemic by changing their shopping patterns. E-commerce accelerated rapidly with the online retail sales index seeing the greatest growth on record.
During early COVID-19 most conventional in-store retail activity ground to a halt, as did tourism, hospitality and place-based entertainment industries. Some restaurants quickly developed online models that would have been impossible just a few years ago, again these trends are refocusing the importance of home.
There are already signs that more buyers are eyeing larger homes and apartments, it’s an early tangible sign of change in the housing market and it’s partly driven by technology to aids many of the trends discussed here.
As many of us are perhaps spending more time than ever in our homes, we’ve had little choice but to create impromptu home offices, gyms, and playrooms during self-isolation and earlier restrictions.
However, it’s unclear if these temporary shifts (underpinned by technology) will mean a continued search towards upgrading or redesigning homes. We can also consider trends that indicate some city dwellers may reconsider where they live, although how serious people are about a possible move to country or regional areas will be absolutely aided and driven by technology.
A More Inventive Future
Reading an article in the New York Times, I was reminded that ‘a surprising number of the conveniences of modern life were invented when someone stumbled upon a discovery or capitalised on an accident: the microwave oven, safety glass, smoke detectors, artificial sweeteners, X-ray imaging.’
While many drugs of the 20th century were discovered by someone who picked up on the “wrong” information.
While considering the impact of technology hand in hand with the impact of COVID-19, I wonder given so much change and so many unusual events and circumstance, if on a positive note, we might just end-up (perhaps by accident) creating better homes and places to live, better cities and communities.