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Working from home has changed the way people view property. Picture: iStock
I’ve noticed my local laundromat doesn’t have as many ironed shirts or slacks hanging on the racks.
It’s unlikely that there’s been a huge shift to DIY ironing, but rather reflects not as many workers requiring the task given the pandemic has triggered extended departures and absences from the five day a week office requirement.
I’ve also noticed the local cafes are much more crowded during the day as the stay at home workers, and possibly under employed, catch up on a coffee or meal.
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Analysis of movement data by Roy Morgan Research during mid-January shows movement levels 66 per cent down in the Sydney CBD on last January. It certainly invites the conclusion that the work from home (WFH) trend – and it ought be remembered that for a time it was initially government mandated – is really here to stay.
Vacancy rates are up in the CBD.
That has big ramifications for how and where we reside.
And I see recent research from hopeful commercial office leasing agents at Colliers International suggesting that pending demand has come back for office space needs.
But I just don’t see it.
The backdrop is that actual office vacancies are up in every CBD across Australia except Perth where mining industry employment is back. The national CBD office vacancy rate increased by 1.1 percentage points from 12.2 per cent to 13.3 per cent in the December quarter, according to commercial agents JLL.
Office vacancy rates in Sydney and Melbourne have risen to 11.9 per cent and 13.2 per cent respectively as businesses have reduced their property footprints during the pandemic.
And the latest data from CoreLogic shows home prices rose in 85 of the key 88 local government regions last month, but fell slightly in the Sydney CBD, inner west and Melbourne’s inner east.
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Certainly working from home isn’t for everyone. Especially with a lack of a dedicated workspace, and given the proximity to spouse/partners, and or children and housemates. But Knight Frank expect hybrid arrangements will be the most common work arrangements. It expects any mandating of either 100 per cent office attendance or 100 per cent WFH likely to meet with resistance from employees.
“The key will be flexibility with most companies assuming two to four days in the office each week, on average, across their employment pool,” it forecast. There was recent commentary from Robert Freestone of UNSW that noted places of residence and work became more distant than ever before over recent decades. But he added the COVID-19 pandemic meant working from home had received “a far-reaching fillip.”
The key with working is flexibility.
He noted the pandemic has given new impetus to the critical rethinking of dispersed urbanisation that dates back to the sharp rise in energy prices in the early 1970s, and the idea of working from home re-emerging at the dawn of the telecommunications revolution early in the 1980s.
Freestone advised Australian tax-deduction policies did not cover the capital costs of home renovations made to provide a home office. “Yet these modifications are of great importance for successfully working from home,” Freestone noted.
Veteran agent John McGrath recently told me many people have and will choose to relocate to more affordable lifestyle locations.