The Urban Developer
AdvertiseEventsWebinars
Urbanity
Awards
Sign In
Membership
Latest
Menu
Location
Sector
Category
Content
Type
Newsletters
Untitled design (8)
LESS THAN 30 DAYS UNTIL OUR FLAGSHIP CONFERENCE 29-31 JULY, GOLD COAST
4 WEEKS UNTIL OUR FLAGSHIP CONFERENCE 29-31 JULY, GOLD COAST
SECURE YOUR SPOTDETAILS
TheUrbanDeveloper
Follow
About
About Us
Membership
Awards
Events
Webinars
Listings
Resources
Terms & Conditions
Commenting Policy
Privacy Policy
Republishing Guidelines
Editorial Charter
Complaints Handling Policy
Contact
General Enquiries
Advertise
Contribution Enquiry
Project Submission
Membership Enquiry
Newsletter
Stay up to date and with the latest news, projects, deals and features.
Subscribe
ResidentialDinah Lewis BoucherTue 14 Jul 20

Forget Cities, the Post-Covid Push Towards Towns

TUD+ MEMBER CONTENT
dd0fc579-9a43-44f5-a781-b7ccfd6bc203
SHARE
1
print
Print

Changes in high-density cities as a result of the coronavirus pandemic could prompt a shift in housing demand towards smaller towns and suburban or rural areas.

Current flexible working conditions could reduce demand for centralised office space, ultimately enabling workers to live further from their place of employment, says global ratings agency Fitch.

While sustained unemployment levels and economic uncertainty may also mean fewer mortgage applications, particularly for first-time buyers, Fitch expects this could result in increased demand for multifamily and single-family rental properties.

Taking in the U.S market, Fitch forecasts home price growth as likely to increase in areas where home sales and new mortgages are driven by migration to smaller cities or suburban and rural areas.

A recent report backed by the Regional Australia Institute expects the aftershocks of Covid-19 could impact regional population trends, with a growing number of millennials looking to regional areas over capital city living.

The forecast follows data which shows Sydney lost more millennials to the regions than it gained—before the onset of Covid-19—between 2011 and 2016.

In its latest report, Fitch Ratings explores the potential short and long-term effects of the coronavirus pandemic on structured finance assets in the US.

In the commercial sector, Covid-19 has caused a sudden shift to working from home altering both commercial and residential property use.

“The extent to which this is sustained beyond the short term would result in reduced demand for city-centre office space, and there may be elevated housing demand outside of urban centres, with people seeking more space as they spend more time at home,” Fitch analyst Marjan van der Weijden said.

“We expect to see these trends reflected in both residential mortgage-backed securities (RMBS) and commercial mortgage-backed securities (CMBS).”

Last-mile logistics and distribution facilities are expected to become increasingly important as online commerce partially replaces physical stores.

“Over the longer term, consumer views on sustainable consumption and our relationship with physical spaces will change different aspects of commercial real estate,” van der Weijden said.

Hotels that cater to business and event facilities are also expected to see a slump in demand over the longer term, Fitch analysts say, as companies re-evaluate business travel.

Fitch expects structured finance backed by aviation or hotel exposure to continue to feel the effects of the pandemic.


ResidentialInternationalAustraliaReal EstatePlanningPlanningSector
AUTHOR
Dinah Lewis Boucher
More articles by this author
ADVERTISEMENT
TOP STORIES
Molti chief Ben Teague out front of 32 Mercer Road Aramadale (rendering)
Exclusive

Buy on the Sound of Cannon: Molti’s Counter-Cyclical Move to Melbourne

Leon Della Bosca
5 Min
Exclusive

Tapping the Bunnings ‘Halo Effect’

Taryn Paris
5 Min
Exclusive

‘Construction Not a Scale Game’: Hutchinson

Phil Bartsch
9 Min
Nation's build-to-rent project Charlie Parker in Sydney's Parramatta where more projects are being located and built outside the CBD.
Exclusive

Foreign Capital Still Dominates BtR but Things are Changing

Marisa Wikramanayake
7 Min
Exclusive

Fortis Reveals Plans for Coveted Bowen Terrace Site

Taryn Paris
4 Min
View All >
Singapore’s Furama Hotels reportedly picked up the Skye Suites for $68 million amidst an Australian acquisition spree.
Hotel

Sale of Sydney’s Sky Suites Year’s Biggest Hotel Deal

Renee McKeown
Jinding Larkview Mt Barker EDM
Residential

Jinding Expands into SA with $180m Mount Barker Approval

Vanessa Croll
Molti chief Ben Teague out front of 32 Mercer Road Aramadale (rendering)
Exclusive

Buy on the Sound of Cannon: Molti’s Counter-Cyclical Move to Melbourne

Leon Della Bosca
The developer sees opportunity where others see risk, positioning for the next cycle with strategic acquisitions and pat…
LATEST
Singapore’s Furama Hotels reportedly picked up the Skye Suites for $68 million amidst an Australian acquisition spree.
Hotel

Sale of Sydney’s Sky Suites Year’s Biggest Hotel Deal

Renee McKeown
3 Min
Jinding Larkview Mt Barker EDM
Residential

Jinding Expands into SA with $180m Mount Barker Approval

Vanessa Croll
2 Min
Molti chief Ben Teague out front of 32 Mercer Road Aramadale (rendering)
Exclusive

Buy on the Sound of Cannon: Molti’s Counter-Cyclical Move to Melbourne

Leon Della Bosca
5 Min
Justin Butterworth will speak on a panel at Urbanity 2025 on the Gold Coast.
Technology

Platforms Pump Up Rental Revolution: Justin Butterworth

Renee McKeown
4 Min
View All >
ADVERTISEMENT
Article originally posted at: https://theurbandeveloper.com/articles/swapping-high-density-cities-for-rural-towns-post-covid