How COVID-19 Has Changed the International Property Market

Unprecedented liquidity and rising appetites for meaningful living will spur demand for investment properties that fulfil both capital and lifestyle aspirations.

The COVID-19 pandemic has wreaked havoc across virtually every sector of our lives, upending previously deeply held assumptions and forcing a reevaluation of everything we thought we knew.

Even the real estate sector, long considered a stable investment, is witnessing a seismic shift like never before. Unexpected but lethal combinations of factors are turning even once rock-solid investments turning into a painful rash of failures.

In this post, we will examine some of the forces at play, and attempt to shed some perspective on what is ailing the international property market.

The pandemic has changed our focus

COVID-19 has changed the way we work, purchase goods and services, and how we live our lives. Remote working is taking precedence, especially among critical sectors like IT, tech, marketing, business and education.

With more people spending more time at home, demand for e-commerce and delivery services have risen in response, as businesses formulate new ways of serving their customers. This global boom, while increasing revenue for e-commerce players, has placed tremendous stress on supply chains around the world.

On the flip side, border closures, movement restrictions and stay-home orders have claimed a toll on traditionally booming markets, including office, retail, F&B and hospitality.

In contrast, residential players and those catering to a pent-up population seeking relief in domestic arenas can benefit by offering options to help customers achieve some semblance of normalcy.

There’s unheard-of liquidity in the markets 

Governments around the world are trying to spend their way out of the economic damage wrought by the pandemic, printing money at a pace unprecedented in the history of mankind.

The US is leading the way, with both Trump’s and Biden’s administrations launching several rounds of stimulus checks. The flood of liquidity has found its way into the stock market, which explains the worldwide boom.

While equities and cryptos are currently basking in the spotlight, it would be interesting to see where investors would be headed next.

Aspirations are changing

Amidst a backdrop of a rapidly ageing world population, attitudes and aspirations towards work and living is changing.

Perhaps aided by the rise of the gig economy, millennials, Gen Zs and beyond are placing an increased emphasis and value on liberation from monotony. More than ever, “living as one pleases” is gaining ground in the popular imagination, and pursuit of such a lifestyle is increasingly valid.

Accompanying this rising preference are several values that current generations hold dear, including IoT and tech-enabled connectivity and convenience; new and unique experiences curated according to personal tastes; finding meaningful work instead of merely earning a paycheck; living sustainably, in harmony with nature and the environment.

Impact on the international property market

Given these observations, it will be interesting to see what forms of property investment will gain ground in the next decade.

We think that living concepts providing curated experiences and impeccable locations powered by a full IoT environment will emerge as forerunners and winners for their ability to cater to emerging notions of meaningful enjoyment.

Another dimension to consider is how as worldwide wealth increase, heightened awareness and demand for leisure travel will stoke demand among savvy investors for properties that not only furnish a good investment return but also ensure access and availability on demand.

What will world-class curated living catering to the ‘no compromise’ generation look like? We’ll explore the possibilities in our next post.