Are you buying an investment or a lifestyle?

Buying a home is generally the largest single investment most people make, and in many cases the decision process is led by “investment” considerations. Will the property increase in value; is there a ready market for re-sale; is it a reasonable price based on other properties; is it low maintenance; will the style “date” quickly; etc, etc. However, buyers are also looking at lifestyle, whether consciously or not, when making such home purchase decisions, so how is that assessed?

Depending on the buyer profile eg young marrieds with or without children, upsizers with a growing family, empty-nest downsizers, tree or sea-changers, aged couples; there are attributes which whilst not necessarily front of mind, will be extremely important. For those with children, local school feeder zones and comparative student results to other schools would seem relevant. Those same families would also be interested to know the average traffic volumes and speeds in the street. Given that they probably inspected the property out of peak hours or even on a weekend, they would not have a good view of the nature of the traffic when they would be most likely to be coming and going from the home.

We could carry on noting these lifestyle attributes covering crime, surrounding community age and health, bushfire or flood risk for that home, nearest open spaces, future planning impacts, or even subsidence risk. Many of these lifestyle risk data attributes are not readily available when assessing potential properties and are unlikely to be volunteered by your real estate agent, even if they were aware of them. Anything that might highlight risk of selling the property would not be in the agent’s best interest to disclose.

Now that we’ve entered a new post-COVID-19 world, there are even greater pressures to get property purchases right. Isolation and social distancing will change a) the way people search for and assess properties, b) the attributes regarded as more desirable eg separate study for working from home or not needing to be near transport routes as much, and c) the need to be able to live a much fuller and satisfied life within and around, rather than outside, the home. It may also affect the ability to move every few years as the property market deals with lower overall demand and mobility.

In summary, in my view we will see a much greater focus on lifestyle attributes with property purchases in the future as distinct from the obvious investment characteristics. Now its up to the PropTech sector to respond to this shift in focus and provide property buyers with the personalised information they need to be best informed and the processes which better enable transactions. A new startup, Residz, are driven by this imperative and are working hard on it.