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Real estate industry and Corona: optimism in the crisis

People's lives have always changed disruptively. The triggers range from inventions like electricity to historical events like the fall of the iron curtain. The current situation is also such an event. A virus that paralyzes the entire life of society leaves the world in a different state.

According to the Johns Hopkins University, there are currently around 2 million infected people (as of April 15, 2020). In the United States, over 16 million people have now become unemployed. Despite these dire numbers, the aim of this article is to focus on the positive changes that this crisis will and can bring with it. It also raises the question of whether new, innovative solutions will also be used in the real estate industry in the future.

Transformation of society through Covid-19

We live in a time in which more and more people feel stressed. According to a study from 2016, it is now over 60 percent of Germans. One or the other might find it nice to spend a few days at home and think about what is really important. To realize what you really need to live.

There is currently more time for the family and maybe it will stay that way in the future. Working from the home office, which around 30 percent of Germans want, was often considered impossible. At the beginning of March around 46 percent saw their employer not even technically capable of doing this. The current situation brings the "digitization push", which the management of many companies has missed.

But not only companies, but also other organizations such as universities are now being forced to change something. For many students, going to university for an exercise or a lecture is a waste of time. Digital offers would be an alternative to this. The current compulsion to digitize will make the lives of many people more effective and efficient in the long term.

Change in the environment as a positive effect

True to the motto "Nature takes back what belongs to it", pictures of crystal clear Venetian canals, in which even fish swim, have gone around the world. Another positive news: the Ministry of the Environment and the Federal Environment Agency still consider the climate targets for 2020 to be achievable.

Even flying should change, probably even sustainably. When asked by the Hessenschau whether there will be as many flights as before after the Corona crisis in the long term, the professor of air traffic management at Frankfurt University Yvonne Ziegler answers:

“I think there will be a certain dent because a lot of companies are realizing that video conferencing can save them a lot of money. Certain business trips are put to the test. And that may have a lasting negative effect on business trips. [...] ”

The positive consequence of this is that by rethinking personal meetings, a lot of CO2 can be saved by eliminating business flights. Business flights make up more than a third of the passenger volume at Frankfurt Airport.

The coronavirus and the real estate industry

The real estate industry is experiencing a real “digitization push” these days. According to a survey in the construction and real estate industry, according to the current experience with the corona crisis, 66 percent of those surveyed would next invest in the digitization of processes and 46 percent in web-based software solutions. Investing in digitization can have many advantages. They offer solutions to the challenges of these times.

Mass visits are currently no longer possible - but virtual visits are. With the help of 360-degree cameras, digital tours can be created. Those interested in housing do not even have to get up for this. The new apartment can now be viewed comfortably from the sofa. The latest technology even enables measurements to be carried out in virtual space. So you can see immediately whether the bedroom closet fits into the new home. Hopefully, the virtual possibilities will make unpleasant mass visits a thing of the past.

Another innovation that has made life easier for many property managers is virtual WEG meetings. Each participant can control an avatar, a graphic representation of himself, similar to a video game, through the room. The administrator also has an avatar and can show presentations and files in the virtual room, which can be edited in real time. This has the advantage that the administrator can participate from the office and saves traveling. Other positive aspects are that costly room bookings are no longer necessary and virtual meetings can be planned much more quickly. The only problem that still prevents its use is the outdated Condominium Act.

Another positive effect, at least for property buyers, is the dip in purchase prices forecast by the Empirica Institute. A decrease of 10 to 25 percent is expected here as a medium-term effect. This could enable residents in swarm cities in particular to dream of owning their own home. For rents, by the way, the experts expect a much smaller slump in the medium term and then further stagnation.

Property buyers are not the only buyers benefiting from the Corona crisis. Digital sales, which previously often failed due to technical challenges or conventions, is currently reviving. Personal conversations become digital meetings. With one click the screen is split and it can be presented. Ideally, the contract will be sent immediately afterwards.

The failed face-to-face meeting is resolved by the electronic signature. The contract is signed digitally with the mouse or a tablet pen. In addition to the fact that online sales and electronic signatures accelerate business processes, the mess of paperwork will also be put to an end. This is good for the environment.

There are also advantages that you don't even consider for the time being. Because for 30 - 40 percent of employees in the real estate industry, home office is a selection criterion when choosing a job. A digitized company can stand out in the fight for the coveted skilled workers.

EverReal has also developed cloud software that makes the entire rental process for tenants and landlords as smooth as possible. Regardless of whether process automation, smart tenant matching, or Schufa information, EverReal has the digital solution for your rental problems. You can find out more about the topic here.

If you would like to know more about the topic or sources, please write to us.

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