Posted on 04/05/2023 5:51:32 AM PDT by EBH
My 38 year old daughter was let go from a job she had for over ten years with a company that builds and maintains websites for private schools. She had been working remotely for several years. The company did not even have a corporate office.
She was offered a new job last week. A 15% increase in pay basically doing the same thing. Again, another company where she will will remotely out of her house. The company is in SC. She lives in NH.
My neighbor is an engineer. He works entirely from home.
Covid may have been the catylist for this change. However, this is a long term change that is not going away.
One of the major changes will be a leveling of real estate prices around the country. Maybe even the world. IF you can work from home. All you need is an internet connection. Elon is making that possible anywhere in the world. So, instead of living in Alabama or Idaho or the USVI. Why not live in Italy if you can buy a house on the Med for under 200K EUROs?
“Their.”
I keep doing that, even when I know it’s wrong.
Go onto YouTube and you will see that throughout the countryside of Italy. The difference is people actually want to live in the rural villages of Italy. They do not want to live in poor sections of Detroit and Baltimore because they are not SAFE.
Agree; most of the office buildings near me have two large signs in their windows: 1 - Office Space Available; and 2 - Workspace for Rent. The latter is conceived for people working from home that either want in-town workspace or a conference room for a day, etc. The problem with the latter is that there just isn’t enough demand for the temporary space idea and the buildings have become a lot of empty space. That is why Jamie Dimon of JP Morgan told his employees they have to come back to the office - he has a brand new 70 story office building in Manhattan that is owned by JP Morgan and he probably has commitments to the restaurants and shops on the lower floors that would not be happy with an empty building.
I suspect that is what the government will do with all of that now-empty office space (turn it into Section 8 housing).
Both my son (IT specialist) and daughter (International bank) have worked from home for going on three years - with no end in sight. In my son’s case, the CEOs of the business sold the building so there is no office to return to. He says this is going on all over the tech industry.
Son did tell me that Apple recently completed a billion-dollar headquarters in the Bay Area - just as the “pandemic” hit and everyone was sent to work from home - Apple has a very pricey, empty building just sitting - and that’s why they’re demanding their workforce return- some are quitting over being mandated to return to work.
They could sell it off to the government for housing, and may eventually have to.
New York isn’t any more
Decline is progressing
Personally, I would love to see an American “back to the land” movement with the American Dream being a rural house and a nice garden. Internet connections allow people to work for just about any company in any state, while the worker enjoys a bucolic lifestyle in Arkansas, or Maine, or wherever.
I think big cities are an obsolete concept in the 21st century. And I’m not sure suburbs with McMansions make too much sense either.
But I’m not sure how many Americans really want to live in the middle of nowhere. I like it just fine, but I don’t think it’s a common sentiment.
The big picture issue is that the reasons that cities were created are no longer applicable.
The country of the future will be dotted with zombie cities—eventually they will revert to agriculture.
This may take several decades—but it is a done deal.
Cities must be absolutely safe to make sense—zero tolerance even for petty crime.
That is their only hope—and it is hard to envision a future where that happens.
I'm 79..and finally retired at 75 but about 40 of my business years were running it out of my home.
The best Covid benefit for me was grocery delivery!! Yay...no winter driving here in Upstate!!
That’s racist.
Office workers commuting into work was the last economic lifeline of most of these cities. Now these cities are just massive ghettos. Empty commerial buildings don’t generate tax revenue. Would they make good housing for useless eaters? Yes.
As people get older, they tend to need more medical services. So, they want to be able to go to the doctor within a half hour drive.
They also may not want to maintain a larger property. They may be physically limited. I will be 60 in a couple weeks. I spent yesterday afternoon cutting up a maple tree. It took me about 4 hours by myself. I am not sure I will be able to do that in another ten years. I have 12 acres and live on th edge of suburbia in south central NH. My house is 50 years old. So, it may become more than I can maintain in a few years.
This is generally true of the USA demographic. On average we are getting older. Our kids are not having as many kids as we did. We didn't have as many as out parents. Demographically, the USA is not in as bad of shape as South Korea, Japan, Italy or China. This is because immigrants WANT to come here and we allow it both legally and illegally.
So, the real estate that is going to be most desirable in the USA may be CONDOS. Either free standing or apartments with an elevator. I know the developments that sell the best here in NH are the 50 and over 2-3 bedroom free standing condos. Most are one floor. No stairs to climb. small yard where someone else does the mowing, clear snow and cleans the leaves out of the gutters in the fall.
As an aside, I noticed one potential retirement spot I’ve been considering had a couple of houses under construction. Until they weren’t. Now they’re maybe half finished, and the builder just walked away. They’ve got a roof and tyvek, but that’s it.
“I have no idea what will happen to all of this property if everyone just stops using it.”
Boarded up burned to the ground downtowns AND suburbs nationwide(world wide?). Historic bank names disappeared.
See Detroit.
The tiny town of Trona CA, where I grew up, was turned into a ghost town overnight by one move from Kerr McGee Chemical Corp. I don’t see why that can’t happen to most of the major cities as well.
Money makes the world go ‘round.
All great comments so far, but what I am looking for are ways to capitalize on this new work life.
What else changes?
More virtual assistance, mobile techs for yhe home office, something else that has not been offered yet?
The price per square feet will need a MAJOR adjustment for that to happen.
“the glass is half full”
The owners of these commercial real estate realize the change that has come. They will have to decide what is the best use of their asset. If their revenue stream is going to be reduced, then they will have to refinance that with the bank.
If the bank does not want to refinance they may end up owning that building.
Do you really want the vermin from NYC, Detroit, Chicago, etc., moving into your rural communities and bringing their progressive politics with them? Let them stay in their decaying worker paradises and go down with the ship.
The CRE time-bomb is grabbing a lot of headlines over the last week, but it has been building for a couple of years. What is going to be interesting to me is the head-count effects.
Companies are starting to push their people to go back to the offices. They’d like them to be back full-time, but there’s resistance. The compromise position from the companies is to get people there 3-days/week, and there’s still resistance.
Where is this headed? A few thoughts:
1. People will get fired. They’re largely valuable to their current employers because of company-specific knowledge and know-how they possess ON TOP of their talent stack. Replacements will only have the talent stack. I expect this to translate into lower wages for the replacements and more use of contractors rather than FTE’s.
2. Union power in white-collar jobs will be destroyed. How do you organize if people are kept apart. How do you organize contract-workers? (btw - this is a good thing!)
3. Promotions, earnings perks (stock options, bonuses, etc.) will accrue to those that “go to work”, not stay at home. This will make stay-at-home workers voice even more frustration, as they’re stuck in dead-end jobs with no advancement & inflation-only pay increases (at best) or possibly wage DE-creases. Management will view people as interchangeable parts.
4. Companies will adopt 2-tier wage structures. Pay rate of $X if you’re an in-office employee; pay rate $Y if you’re a home-based employee. Obviously, $X>$Y The turnover and attrition will naturally allow for this over time.
Right now, these skirmishes between companies and workers are going on nationwide. And, with the low U-3 unemployment, workers have an asymetric power advantage. But the tide is turning (witness the massive tech layoffs of late and pending recession). After-all, the companies OWN those jobs; no company, no jobs. The intransigent-class workers don’t see it coming, but they are the instruments of their own demise. It’s going to get ugly.
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