How To Own The Real Estate Market In 2022

It is hard to believe that this year is almost over. However, here we are, and it is fair to say that it has been an interesting year for the real estate market. As we are about to head into 2022, here are several trends that real estate investors might want to know about.

1. Retailers will invest more on order fulfillment

Though shopping malls were having a hard time before the pandemic, the last 20 months of the pandemic have hit them hard. A lot of retailers have gone into bankruptcy and closed their stores, leaving mall owners with vacancies to fill.

In 2022, malls might face difficulties of their own because more brands might opt to sink dollars into fulfillment and distribution centers and less money into store openings and renovations.

2. Workers will return to Office buildings

Office buildings have for the most part been vacant since the beginning of the pandemic. But with COVID booster shots becoming widely available to Americans, offices are beginning to slowly but surely bring their workers in.

In 2022, there is a good chance businesses will put an end to remote work and make their employees show up for work at least a few days each week. Some businesses have already made the choice to let workers do their jobs from home on a permanent basis. However, for companies not making that decision, 2022 might be the year when more workers find their way back to the office.

3. Leisure travel will help hotels

Given that 2021 is coming to an end and many businesses still have not brought workers back to offices, it is not likely that business travel will effectively take off in 2022. That’s one thing hotels will need to deal with, and properties that routinely serve business travelers could face vacancies and earnings concerns as well.

Meanwhile, leisure travel might spring some life back into the hotel industry. That is great news for hospitality REIT investors after a terrible 2020 and a shaky 2021.

4. The short-term demand for rentals will continue to boom

While hotels should have a decent stream of bookings next year, travelers might still prefer short-term rentals. This option might be particularly appealing to households with children during the start of the year.

As of now, children below the age of 5 are not eligible for a COVID-19 vaccination. That might change early on next year, but it will take a while to get that part of the population vaccinated. This means those who invested in short-term rentals might really benefit from ongoing demand.