The real estate industry is a dynamic one, shaped by the economy, technological advancements, and societal shifts. As we stand on the threshold of a new era, it’s essential for both buyers and sellers, as well as investors and real estate professionals, to adapt to the upcoming trends that will define the market from 2023 to 2025.
This implies that real estate professionals should practise their sales techniques and educate sellers on the current market and what they can expect from their prices. It can start with looking the part, putting on your best blue dress or suit and getting prepared for what comes next.
When it comes to investors, it’s crucial to conduct a risk analysis and ensure you’re investing in properties that complement the fluctuating real estate trends and stay ahead of the competition.
What’s The Current Market Like?
Due to economic challenges as a result of the pandemic and the fierce surge in house prices since March 2020, this influence has first-time buyers and other potential buyers pausing their plans and waiting for a stable time—in a sense, a cheaper market.
Nationwide data shows that UK house prices fell by 1.1% in February this year, which is the first annual decline since 2020. As the years went by, it was reported to have fallen a further 4.2% this September.
Zoopla reports that sellers are going as far as discounting their homes just to achieve a sale, with an average reduction of just over £14,000, which equates to a third of the gains made during the pandemic.
Real Estate Trends 2023–2027
1. Embracing Sustainability and Green Real Estate
Sustainability is no longer a mere buzzword but a driving force in real estate. With growing awareness of environmental issues, buyers and renters are increasingly seeking eco-friendly homes.
Developers are responding by incorporating sustainable design elements, energy-efficient features, and renewable energy sources into their projects. So you should keep an eye out for any potential investment opportunities.
In the years ahead, green certifications like LEED and WELL will become more prevalent, adding value to properties and reducing operational costs for owners.
As well as the huge BTR development plans across the city, Birmingham will see much redevelopment that is set to not only create jobs but also boost the local economy and property market.
The central Birmingham framework sets out ambitious plans to complete the city by 2040, embracing greener initiatives and creating a more desirable place to live.
3. Not Signs of Crashing
Despite how the current market and prices are starting to plummet, with predictions of house prices declining more purely since buyers can’t afford the current house prices.
Evidence does suggest that the UK housing market is far from a crash. While values will dip in 2024, the Office for Budget Responsibility is predicting that prices will fall by 10% between 2023 and 2025. Although there is a drop in prices, the magnitude of this should not be equated to a housing crash.
4. Rising Co-living and Flexible Housing Options
The way people live is changing, and so is their demand for housing. Co-living spaces and flexible housing options are gaining popularity, especially among millennials and Gen Z.
These arrangements offer communal living experiences, flexible lease terms, and a range of amenities, catering to the evolving needs of a mobile and diverse workforce.
5. Technology Integration
Technology continues to revolutionise real estate. Smart home features, from automated security systems to energy management, are becoming standard in new construction.
Virtual reality and augmented reality are transforming property viewing, allowing buyers and renters to explore homes remotely.
Artificial intelligence now allows you to design your house with a simple picture upload. This could transform the way real estate professionals stage homes, sell homes and operate completely.
6. Investment in Affordable Housing
The affordability crisis in many regions has sparked increased interest in affordable housing solutions.
Governments, investors, and developers are collaborating to address this issue, leading to innovative approaches like Mirco-apartments, shared equity programmes, and public-private partnerships aimed at providing affordable housing options for a broader range of income levels.
This couldn’t come at a more convenient time with the cost of living crisis; affordable housing is needed and adapted perfectly to societal and economic shifts.
7. Build To Rent
The next few years are set to be years of build-to-rent development with these specially designed rental communities that are quickly becoming popular. Record-breaking BTR deals securing over four billion in investment, it would be silly not to hop on the trend.