In response to the COVID-19 pandemic, many companies have instituted work-from-home programs for office workers. Stanford University Professor of Economics Nicholas Bloom says that 42% of the US labor force is now working from home [1]. These programs are changing the apartment rental market dramatically.
These programs have proven very popular with employees. A survey [2] conducted by job hunting site LiveCareer.com found that:
- 81% of respondents enjoy working remotely.
- 65% believe that remote work has positively affected their work-life balance.
- 60% say that they have grown more productive while working from home.
Further, 61% of employees want to continue working from home after the pandemic. Further, 29% say they will quit their jobs if they are not allowed to work from home.
Employers are starting to warm to the idea of working from home as well. In PwC’s Remote Work Survey [3], 83% of employers say the shift to remote work has been successful for their company. This is up from 73% in June 2020. Many large companies – including Aetna, Amazon, Capital One, Facebook, MasterCard, Microsoft, and PayPal – have announced permanent work-from-home options.
Companies are working on a number of fronts to make work-at-home options more successful. Measures include training for managers, equipment loan programs, and mental-health resources for at-home workers. Businesses anticipate long term changes to office work. More than two-thirds (68%) of large company CEOs plan to downsize their office space [4].
“We’ve proven we can be very effective and productive in virtual work environments,” KPMG CEO Paul Knopp told CNN Business.
Expanding the Range of Apartment Rentals
Ongoing support for working from home gives employees an opportunity to relocate to areas where the cost of living is much lower than major metropolitan areas. But for people who have friends, family, and favorite hangouts, the prospect of moving to a small town in middle America is not appealing, even if it would save them thousands of dollars.
Instead, they are choosing to move a short distance from the city centers – far enough away to reduce their costs, but close enough for frequent visits. This is a particularly important consideration if employers still require some time in the office (perhaps one or two days per week).
Residents of San Francisco, for example, are looking across the bay to Oakland… a city with its own rich culture, but significantly lower rents and home prices.
What Work-From-Home Renters Look For
1200 Lakeshore, a luxury apartment on the shores of Lake Merritt, reports that they have seen a significant increase in prospective renters coming from San Francisco.
Relocating tele-commuters are looking for the same features as anyone else:
- spacious floorplans
- great views
- plenty of light
- modern kitchens
- a well-equipped fitness center
- nearby entertainment and dining options, which they are used to in their current locations
But in addition, they demand high-speed Internet, and space for a home office or workspace. Renters also want outdoor spaces to avoid claustrophobia after spending all day in their apartment!
According to Jane Weynock, an interior designer in Los Angeles, the need for a quiet home workspace is changing what people look for in an apartment. “Until recently, everyone was looking for open floorplans,” says Weynock. “But now they’re looking for separate areas. It can be very hard for working couples when both are working from home; ideally they each want their own office. So we’re seeing a demand for more private spaces, even if the rooms are smaller. I have one client in San Diego who has converted her balcony into a workspace!”
Stanford’s Nicholas Bloom [1] says, “Many Americans lack the facilities or sufficient internet capacity to work effectively from home. More than half of those surveyed who are now working from home are doing so either in shared rooms or their bedrooms.”
Work-From-Home Creates New Options in the Apartment Rental Market
Despite the challenges of finding suitable spaces, at-home workers are no longer constrained by commute distances, and they’re willing – and even happy – to consider new locations.
People moving across the bay from San Francisco to Oakland, for example, have the opportunity to explore a wonderful new city, while not straying too far from their old haunts. And while they may work from home most of the time, they’re not too far away to drive into the city for an occasional meeting.
This trend is being echoed across the country, as the new work-from-home workforce moves outward from crowded and expensive city centers. The new apartment rental market is much less centralized. Stanford’s Bloom concludes, “If I were a company right now planning the future of my office, I would be looking to the suburbs.”
References
[1] “Stanford research provides a snapshot of a new working-from-home economy.” Stanford News, June 2020.
https://news.stanford.edu/2020/06/29/snapshot-new-working-home-economy/
[2] “Is Remote Work Here to Stay?” LiveCareer, January 2021. https://www.livecareer.com/resources/careers/planning/is-remote-work-here-to-stay
[3] “It’s time to reimagine where and how work will get done.” PwC, January 2021.
https://www.pwc.com/us/en/library/covid-19/us-remote-work-survey.html
[4] “The office, as you know it, is dead.” CNN Business, August 2020.
https://www.cnn.com/2020/08/25/business/office-space-remote-work-pandemic/
