WFM may boost demand for housing in Tier-II, III cities

Home is just not a place to rest at night, but also a workplace for many and may continue this way in the future

It is very easy to call 2020 one of the worst years in our lifetime; with the global economy expected to shrink by 4.4 per cent, many losing their jobs and over a million (1.8 mn) deaths due to Covid. This pandemic has pushed many countries into recessions and many are reeling under the second and third waves of this pandemic. It has confined our lives within our home, and homes being transformed into offices leaving a thin line between work and personal life. This has also impacted our work and personal life, impacting the physical requirement of the built environment. Few major emerging trends related to work and impacting our physical requirement of home are discussed below.

Work from hometown

What started as work from home (WFH) at the start of this pandemic, with time has transformed into work from hometown. In the initial period, people started working from home with limited domestic help and no physical interaction at the workplace. This forced many bachelors and nuclear families to move back to their hometowns. Many students and bachelors left their rented accommodation in this period and went to their hometowns. Many IT companies have announced long-term plans for work from home for their employees. This has the potential to boost the demand for housing in Tier II & III cities and towns.

Boost in demand for a second home and medium-stay accommodation

This break in the physical office ecosystem has also highlighted the importance of work from anywhere. This can be manifested in many ways including work from a second home for the upper strata of our society. And for many to work from preferred destinations with options of extended stay through Airbnb, etc. at locations like Goa, hill stations or other lesser explored locations that offer economical options. Moving from consumerism to consumption-based ownership of physical assets

The mad rush of consumerism and urge to accumulate more seems to have given way to an appreciation of once possessions. For example, the research showed, in the pre-Covid era, the Millenials preferred not committing money to own physical assets and preferred spending on lifestyle. They preferred renting houses, traveling in rental cars and enjoying vacations. The Covid times have shown the importance of owning these physical assets like a house and means of transportation. Ownership of physical assets offer options for customization and personalized use.

Importance of house for end-use, as compared to an investment asset

India has high home ownership, about 69 per cent in the urban areas and 95 per cent in rural (as of 2011), as compared to many developed economies. In absence of social security cover, homeownership has always provided a sense of security and social status in India. With the boom in real estate during 2004-2008 and even afterward in many parts of the country; residential real estate has become a preferred investment asset, resulting in multiple homeownership for middle, upper-middle and high-income segments.

Due to oversupply in many markets, the last few years have seen stagnation in real estate prices which has limited its attractiveness as an investment asset. This pandemic made people realize that instead of multiple ownership of properties it is better to have a larger multi-family (apartment) or independent house that will better serve the requirements of work from home. This resulted in an emerging trend of consolidation of multiple properties into a larger house. In different parts of the country, this has resulted in people moving to larger multi-family apartments or single-family houses depending on cultural and personal preferences. There have been instances whereby, people have moved into larger rented houses leaving self-owned smaller houses for suitable work from home environment.

Rebooting Real Estate strategies

With the new normal of change of residential premises into home-office, real estate requirements of people are transforming. Home is just not a place to rest at night, but also a workplace for many and may continue this way in the future. This requires rebooting of the strategy towards this asset class in terms of physical and product design.

Redesigning of Home cum Office

With houses being increasingly used as home-office, this calls for the unit redesign in new projects and modifications in existing ones. One obvious solution is having additional study rooms, but a study room for each member will result in cost escalation, which might not be a feasible option for middle-class households. Contrary to this idea, the research has shown in the last few years the size of multi-family houses has shrunk to make them more affordable. This problem requires more ingenious solutions like creating a small alcove (say 4 by 5 feet) within a bedroom or a store/powder room cum study room. These spaces can have multiple uses in the case of use as home-office or otherwise. Other options could be innovation in furniture designing and creating pod-studies on the lines of pod-hotels.

Redefining housing complexes

In the late 1990s, the concept of "Walk to Work" evolved in Gurgaon, with DLF creating large residential and office complexes located next to each other. But with the changing times and transformation in the physical workplace, a new concept that I call "Walk to Home Office" will gain significance. Working from home has its own set of challenges. Many of us may have seen in between an important meeting, a child walking into a room with a full-blown expression creating an embarrassing situation. There are challenges in conducting important client meetings from home. In multi-family housing complexes, today shared facilities like a community center/hall are common. On similar lines, a modified version of co-working spaces can be integrated within residential complexes, these facilities can be used by residents on a need basis and shared with outsiders for commercial viability.

This will bring more professionalism to working from home, on a requirement basis. Besides, it will provide a safe working environment for female workers, even at odd workings hours, in comparison to traveling to physical offices. Traditionally while looking for a house, one evaluates distance from the workplace, school, etc. This kind of integrated facilities may provide opportunities for creating stand-alone complexes at more affordable locations away from prime office districts with better amenities and lifestyle. Maybe someday these integrated complexes may become feasible in Tier-II towns or at the outskirts of Tier I cities.

A positive side of this pandemic is that it has broken many barriers related to work and work culture. Many of these barriers existed in the human mind and resulted in a waste of time and resources in traveling for meetings within cities and across multiple cities. Today a diverse set of activities are being organized online like board meetings, academic delivery, client meetings and internal team discussions. This requires a change in mental and physical setups having a profound impact on human wellbeing and requiring changes in our physical apparatus. These lifestyle changes will manifest themselves in the physical real estate. Those developers that will read these emerging patterns and embraced them will remain relevant to the changing times.

(The author is Director- Research & Consulting and Associate Professor at RICS School of Built environment, Amity University, Noida.

Views expressed here are personal)