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Covid-19 has affected the way we consume and invest in profound ways, but many would argue that it is the property market that has seem the biggest disruption. A new research paper, by Sitian Liu and Yichen Su, shows that the pandemic has led to a substantial shift in housing demand in the US, away from neighbourhoods with high population density. They also find that neighbourhoods with high home values before the pandemic see a greater drop in housing demand. Big cities lost; smaller cities gained.
But it is not just demand that has shifted. On the supply side, Covid also gave rise to new innovations. Neighbourgood is a next generation South African developer and operator of modern homes and workspaces. Founded just after hard lockdown last year, Neighbourgood repurposes hotels, guest houses and office spaces that are no longer relevant, to create co-living and workspaces. I asked founder and CEO Murray Clark to what extent Covid-19 has disrupted the property sector.
“The sector is vulnerable. If one looks at the listed companies and accurately assesses the underlying assets, most of it is made up of a combination of commercial offices and oversized retail.
