11.29.2023 Lifestyle

The Work-From-Home Wave

The Work-From-Home Wave

Remote work is here to stay.

We look at how working from home continues to have an impact on the property market in Sydney’s Eastern Suburbs.

Pre-pandemic, many of us had no clue what it was like to work from home. Now, 90% of Australians say they’d like to perform some of their work remotely.

We explore how the remote working trend is having a major impact on the property market here in Sydney’s Eastern Suburbs.

How many people really work from home?

According to data from Statista, in March 2023, NSW residents spent an average of 2.22 days a fortnight working from home.

Finder’s Consumer Sentiment Tracker (CST) survey also revealed almost a third, or 29% of Australians, worked remotely in 2022.

Data from Forbes shows workers in the tech sector are the most likely to work from home, followed by marketing, accounting and finance, and project management.
Those working remotely are likely to earn more than those who don’t (or can’t). People aged 24 to 35 are most likely to work remotely, and more men work remotely than women.

Perhaps most telling is what people wish for: 65% of workers said they want to work remotely all the time, while 32% prefer a hybrid model.

The direct impact of working remotely

Figures show that only 37% of people are back at the office every day, and this is having a major impact on CBD properties and businesses.

After all, companies need to lease far less office space if a significant percentage of their employees aren’t even coming into the office. In turn, this impacts CBD businesses like cafes, dry cleaners, and retail, as the demand for (and market for) these services suddenly diminishes.

It’s perhaps unsurprising then that a report from McKinsey that modelled the impact on valuations by 2030 in nine cities found remote work risks wiping $US800 billion ($1.2 trillion) from the value of office buildings globally.

Re-shaping the housing market on a macro level

While commercial real estate may be losing out, it’s a more positive story for residential property.

The trend for remote work has reshaped the residential housing market because it has changed some of the features buyers and renters prioritise when looking for a home.
For example, while a short commute is essential if you’re travelling to the office daily, it matters less if you don’t need to commute every day.

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When remote working took hold during COVID, we saw the rise of the lifestyle buyer who moved out of the city.

The eastern beaches also experienced huge demand, causing prices to take a steep jump (the median house price in Bronte almost doubled in just two years post-pandemic).

Working from home makes an impact on a micro level, too

But with hybrid work becoming the norm, some buyers want to have their cake and eat it too. Domain recently put “Properties with home offices and access to public transport” at number three on their list of the properties buyers are competing for the most.

If you’re working from home regularly, the space you have to do this in becomes far more critical – the corner of the kitchen table may not cut it any more.

We’ve also observed a growing trend among buyers and renters seeking properties that offer dedicated workspaces. These preferences range from studios in the garden to study nooks in the kitchen or even space for a desk in a hallway or spare bedroom.

Data from NAB showed almost one in five Australian home buyers rated a study or work area as an important factor in deciding which home to buy. Domain data backs this up, with “study” being the second and third most searched term (measured by year-on-year increases) in both 2020 and 2021.

Domain estimated that a good home office can add as much as 5-10% to the value of a property. In the US, data shows that homes with offices sell for about 3.4% more than homes without. Regardless of the dollar amount, a well-designed home office space certainly adds to the functionality, enjoyment and appeal of a property.

Not everyone can work from home – and some people can’t, or really don’t want to – so it won’t be top of every buyer’s list. But in our area, with a large proportion of professionals and office workers, it’s a defining factor in many people’s property search.

That’s why, when we present properties for sale, we almost always style them to show how the property could be configured to include a dedicated work-from-home space.

Want more?

If you’re interested in buying or selling in Sydney’s Eastern suburbs, get in touch.