More than three years after the pandemic shifted workplaces from office buildings to private residences, the work-from-home phenomenon continues to be a factor in the Mid-Island housing market.
According to a number of local real estate agents, it will likely be a factor for several seasons to come.
Prior to Spring 2020, distance to workplaces was a key consideration for potential buyers looking for well-located homes in central island towns with short commutes. However, remote working arrangements caused by the pandemic have pushed mobility issues down the priority list after shelter-in-place orders went into effect across the region in March 2020.
The phenomenon of working from home is finally beginning to develop, but to a limited extent.
“We’ve certainly seen some employers insist that their employees be back in the office, but not necessarily five days a week…not necessarily all of them,” said realtor Dennis Welch, who works out of the company’s Los Altos office. Real estate compass.
Welch said she no longer hears about long-distance commuting as a high priority for clients as she used to. Instead, they often take into account the new realities of remote and hybrid work. This has changed the criteria for many things real estate buyers value, such as location, square footage, or lot size.
“I’ve found that a lot of people think they’ll continue to work from home or maybe they’ll have to start working from home again in the future,” she said. “I advise my clients to be very open and realistic about their current and future needs.”
Workplace flexibility has become a shared desire locally and nationally, according to a recent survey by Randstad, a company that provides human resource services. It revealed that 61% of the respondents would not accept a job that they felt has a negative impact on the work-life balance.
Many employers and employees expect hybrid work to become a permanent feature, particularly in cities with many tech jobs that provide more remote work opportunities, according to a study published by the San Francisco Federal Reserve in September 2022.
A remote job and housing demand study showed that 30% of work in the United States was still done from home in August 2022.
The continuation of remote work is likely to influence the future path of house prices, according to the study, which concluded that the growth of remote work not only boosted home buying, but drove up home prices during most of the pandemic, as the imbalance between supply and supply is skewed. Demand has deteriorated in many markets.
According to the study, the shift to remote work accounts for 60% of the rise in house prices in the United States during the pandemic.
According to the report, “Working from home could increase demand for worker accommodation, as activities that used to be done in offices now take up space and time at home.”
In the first year or two of the pandemic, the Peninsula market has seen increased buyer interest in remote communities like Saratoga, and the opposite in established, centrally located cities like Palo Alto, said Nicholas French, a Los Altos real estate agent in Sereno. group. Local agents report that multimillion-dollar home sales are at record levels in select neighborhoods in Woodside, Los Altos Hills and Atherton, where larger spaces can offer more privacy, living space and convenience after the shift to working from home.
Brian Chancellor, Palo Alto realtor with The Sereno Group, said he expects buyer interest in larger properties with plenty of space to accommodate home offices — as well as exercise and leisure facilities — will remain strong in remote communities such as Atherton, Woodside and Portola Valley. He pointed to sales earlier this year at Atherton in the $14-16 million range.
It is believed that current hybrid work trends will reduce activity in remote areas outside the Gulf region, which have been extremely hot among local workers in 2021.
“I think interest in secondary markets such as Lake Tahoe will be affected by what is happening now,” the chancellor said.
Working from home has also affected the local rental market. French said the home rental market in the Central Peninsula was hit hard at the start of the pandemic, with some areas seeing rents drop by as much as 20% as workers no longer needed to live nearby. families or cheaper real estate markets.
“Rents may not have returned to pre-pandemic levels, but we are certainly seeing an increase now compared to the early years of Covid,” French said.
However, French said he cautions potential buyers and renters to assume that recent market trends will not change, or at least will be altered by social and economic forces.