The entire world economy has entered into a new period after the confinement measures adopted by the COVID-19 pandemic. The different industries will gradually recover their activity towards a normality that will not come until the vaccine is available. Francisco Nathurmal, CEO and founder of Bcn Advisors, analyzes how the real estate sector will be during this 12 to 18 months period, marked by changes in the market and a greater development of new technologies.
“This is going to mark a turning point in the real estate sector”. This is how Francisco Nathurmal answers the question of what we can expect after the shock that the COVID-19 has meant in our lives and in the economic activity of the whole world. The uncertainty until the discovery of the virus vaccine is leading changes in the buyers and sellers positioning. Therefore, real estate agencies will have to adapt to the new situation and evolve in their processes.
Changes in sales and rental segments
In this transition period, Nathurmal expects a reduction in international buyers and a higher dependence on the national market. However, “Spanish market will be much more cautious and aware of its purchasing decisions”. Regarding rental market, he expects an increase in the offer and demand in the long term segment. “The owners of tourist and mid-stay apartments will possibly seek protection in the long-term segment”, he says.
The real estate investment sector has the potential to maintain its dynamism by balancing purchases and sales, according to Nathurmal. He explains as reasons “the excess cash flow of some funds and investors, while others will need liquidity because of the impact of the economic situation generated by the COVID-19″.
The social distancing measures are going to fully affect the offices and coworking spaces, so Nathurmal predicts that “they will have to be reinvented” to avoid crowding. “On the other hand, some models such as colivings in apartments can be reinforced by a bigger use of Internet and by keeping a more controlled social company,” he says.
Focus on Proptech and online processes
If there’s one industry that can take advantage of the situation to grow, this is Proptech. Francisco Nathurmal forecasts “a great opportunity to break into the market” and mentions virtual reality technologies as an example. “They are going to make an exponential leap, since many clients will want to see the properties virtually in order to select the best ones in a short list and only visit their final candidates in person”. In summary, the CEO and founder of Bcn Advisors concludes that “the renting and purchasing operations will need to become more automated and less physical”.
That’s why “real estate sector will have to reinvent itself to compete in a much more digital and advanced way than before”, according to Nathurmal, who gives as an example the business strategies and the online pre-sale as a key factors for the new market players. Another feature that he especially emphasizes is the companies’ online reputation, “which will be much more important than before”, as is already the case in other kind of business. In short, “the Covid-19 will promote a change of paradigm and will transform the way of doing business,” explains Nathurmal.
During these months of ‘new normality’ we are going to witness a number of changes that may shape the development of business activity over the next few years. Real estate sector will be fully immersed in them and Francisco Nathurmal is sure of it: “The next months will be a great moment of change so that we can all reinvent ourselves in this new paradigm”. Bcn Advisors assumes the challenge to continue offering an excellent service quality and professionalism, in order to maintain its reference position in the luxury real estate sector.