Florida's housing industry has been one of the hardest hit in the country, and what happens to Florida housing markets impacts both residential and commercial real estate developments as well as many other sectors of the Florida economy, not the least of which are the banking and construction industries.
Which means that when experts start giving their research results on where housing is heading, there are a lot of people in Florida that are paying attention. One of those big research studies hit the presses this week, prepared by The Demand Institute, entitled "The Shifting Nature of U.S. Housing Demand."
Read this new report online here.
Who is The Demand Institute, Author of this Viral Economic Forecast?
The Demand Institute is a newly created organization run by the Conference Board and Nielsen Holdings N.V. From its website:
The Demand Institute is a non advocacy, non-profit organization and a division of The Conference Board, which holds 501(c)(3) tax-exempt status in the United States. The Demand Institute is jointly operated by The Conference Board and Nielsen. Our headquarters is in New York City, with a presence in Beijing, Brussels, Chicago, Hong Kong, Mumbai, Singapore and Washington, D.C.
Our Mission: The Demand Institute illuminates how consumer demand is evolving around the world. We are on a mission to strengthen the growth and vitality of the global economy by helping public- and private-sector leaders align strategies and investments to where consumer demand is headed across countries, industries and markets....
Which means that The Demand Institute's international membership will be considering the information provided in this new report as they consider investing in the Florida real estate market. It's a rather powerful bunch, this membership.
Given the importance of Florida's foreign investors to our economic recovery, it's important to know what powerful international investment concerns are learning about our present and future real estate climate. In fact, acknowledging what investors in places like Brazil, Israel, Canada, and other parts of the world are considering doing in the State of Florida may be just as important, if not more important, than what domestic and local investors are pondering as places to put their money.
Exposure, however, exceeds much more than the Demand Institute's membership. This thing is going viral.
The report is making the national news in coverage by Bloomberg News and other globally prominent media including TIME Magazine and the Wall Street Journal, which gave great attention to the forecast in this week's article, "Housing’s Future: Renting and Downsizing." TIME, meanwhile, is crediting the Demand Institute as confirming that the Housing Industry has begun its turnaround in an article entitled, "Report: Housing Market Recovery Has Officially Begun."
What Does the Demand Institute Report Provide?
At least for the next three years or so, we should expect the following in the housing markets:
home buyers are looking for smaller houses;
the real estate market is beginning to bounce back;
the real estate market will not return to its prior glory days in the foreseeable future; and
the demand for rental properties will be high.
Here, key to real estate developers and land planners, it is projected that:
many new apartment complexes and other kinds of multi-residence projects will be built, many in urban areas convenient to shops, workplaces, and schools;
shadow inventories and distressed properties will be purchased in bulk by the 21st Century's version of a landlord (see our earlier post on national builders moving into this market opportunity); and
home ownership will be tied to smaller, downsized lifestyles: home ownership remains an American Dream, but it's more of a dream these days than a reality.