The coronavirus pandemic has been a major blow to many industries especially with the COVID-19 restrictions which forced many businesses to shut down earlier this year. However, some industries were able to shield themselves much better. The real estate industry, particularly the alternative real estate segment has so far managed to stay afloat and even thrive.
The conventional real estate market has certainly experienced a slowdown. However, the alternative real estate segment which comprises high-end and unique properties has been doing very well despite the economic headwinds. The data reported from these niche real estate segments has been quite favorable and experts believe that it will continue to deliver good numbers. There are good reasons for this as highlighted below.
The high-end segment targets already wealthy individuals
The conventional real estate market may have experienced declining sales as people shy off from mortgages due to the heightened economic uncertainty. The high-end real estate market has been immune to such because buyers in this segment are high-net-worth individuals that buy cash instead of going for mortgages.
Most of the high-end customers also tend to purchase real estate properties for investment purposes. In this case, they would purchase when the economy is not doing so well, hold the property for some time and sell at a markup when the economy is doing really well.
Buyers are swooping up properties away from congested areas
The coronavirus pandemic has certainly demonstrated just how easy it is for a dangerous virus to spread especially in densely populated areas. The need for social distancing has made secluded properties such as those near lakes very attractive to people, thus the rise in demand for such properties.
Demand for industrial properties
There has also been a rise in the demand for industrial real estate especially in areas such as Atlanta and other cities that are strategically positioned. The demand for industrial real estate has particularly been on the rise in cities that are experiencing strong population growth and cities near interstate road networks. Industrial real estate that is located in such cities and near major road networks makes it easier for product distribution across multiple states.