How work, employment, and time change post-pandemic
These days we read and hear about a reemerging economy, increased demand, a return to some sort of normalcy, shortages of wood, computer chips, changes in employment — change all over.
The biggest change we all experienced came from the outside — the pandemic. The things we were used to were suddenly gone, closed, shut down, and no longer the way we were used to.
Reevaluation is a common reaction to sudden, strange stillness like that brought on by the pandemic, says Dr. Elinore McCance-Katz, who leads the U.S. Substance Abuse and Mental Health Services Administration. “It gives people a lot of time to review their lives and think about what life could look like moving forward,” she says. “For many people, that’s not a bad thing, for them to really spend time taking an inventory of what their life is like currently and what they want it to be like.”
For us as investors in residential real estate that also begs the question of what the consequences of these reflections will be.
I already mentioned in previous articles that there will be more demand for single-family homes, ideally, with 4 bedrooms for families with kids, both parents working from home or having the option to apply flex-time.
For couples who want to keep the option to have kids in the future, 3 bedrooms rather than 1 bedroom or 2 bedroom apartments will become more desirable.
It’s not just the opportunity to have a dedicated room to work from when in these single-family houses.
It’s also the ability to enjoy the freedom of space, take up a hobby when the pools, gyms, and other amenities apartment complexes used to attract tenants with are closed (by the government or due to other medical and environmental reasons).
Many people completed their reflection on life and discovered they wanted to live healthier — which means buying more healthy, organic food, and for those more adventurous, maybe growing some of it in the garden. Another reason why single-family homes with some green space will remain most desirable for tenants and continue to be our most favored investment as passive income investors.
Another result of these reflections is the realization that value is important in consideration of what we do with our time. I know a number of people who have decided that the value they receive for their money when renting an excruciatingly expensive tiny apartment i.e. in the San Francisco Bay Area, Seattle area, New York or Boston is not returning the expected value.
Why is that?
The expected value has changed. Many people used to rent these apartments because they were close to work and avoided long commutes. When you spend a year cooped up in such a tiny place you realize that you are spending a fortune on a place you don’t really like to be.
That is part of the reason that people moved back to their parents who often had a house away from the city. They moved in with friends who have more space. They may have decided to try living with a partner — hopefully not only to have more space.
Some of my friends actually took it a step further and decided to buy a house in a more affordable location and bet on the fact that the traditional way of going to work 9–5 each day will never come back if you used to work in an office or cubicle before the pandemic hit.
One thing that I have not seen materialize in the United States is a new view on work in general.
In Europe, it has been common to see work as a means to afford and create life. That includes 30 days of vacation time, 11 federal holidays, about 10 days of sick leave, and commonly weekends off. If you add that together you find that’s 155 days out of the 365 days of the year.
In the US we have, on average, about 22 days of vacation, sick days only in large companies, and the weekends. Strangely most people don’t even take all the vacation time they are entitled to.
This article was partially triggered or inspired by a consulting colleague of mine who said:
“I am working on this project and I have an assignment of 35 billable hours per week. All my colleagues are working 60, 70, 80, or more hours each week as employees. I feel guilty and so I work more even though I can’t bill more.”
As investors in real estate, our future is bright because we will have more and more people interested to rent the places we offer and probably pay more if we provide good value.
When it comes to our reflections and our work culture we still have a lot more to learn so we can have time for these new hobbies, for vacation, for more reflection, and most importantly for ourselves.
I hope you have had opportunities to reflect and began wondering what should your living environment look like going forward, how will you interact with your colleagues and your friends/family and how can you do more for yourself.
Getting into a better balance will pay wonderful dividends.