Homebuyers are willing to pay extra for SMART solutions
Poles are willing to pay for extra functions and services at home and on residential estates, a JLL and Obido survey has shown. This is due to changing demographic and social conditions.
The tempo of life is constantly increasing. Families are being started later and less often, and they are usually smaller now. People are happy to use smartphones in an increasing number of new ways. While society is aging, it is also ever more mobile, and less attached to possessions. These trends affect how we use flats and urban space, and this in turn affects how property developers approach designing residential estates and entire urban spaces.
On the primary residential market, for a long time demographic and social transformation was only felt in the size of flats being designed. Today, the average area of a residential unit is a few square metres less than 10-15 years ago, because more and more buyers are single persons or couples with no children. The new technological solutions, the new ways in which certain goods are consumed, and social trends are also beginning to force the residential market to adapt.
Not only young people feel the need for a smart lifestyle
Working with the OBIDO website, REAS | JLL analysts examined how flat seekers looking on the primary market approach new, additional functions and solutions in flats and on residential estates and to what extent they are inclined to pay extra for them. The findings of the “Smart home, smart community, smart city” report show that one in five respondents would be glad to buy a flat on a residential estate on which there are amenities such as a self-service laundry with drying facilities, moped rentable by the minute, or designated parking spaces for carsharing.
- The survey revealed that having these amenities, even for an extra charge, is significantly more important to buyers aged over 45 than to younger buyers, who are more likely to be looking for a first and cheaper flat. Solutions of this kind are most popular among mature consumers aged 55-65. For this group, a rental car is attractive for almost half of potential buyers – Katarzyna Kuniewicz, Head of Residential Research at JLL, says.
Willing to pay extra for convenience
Amenities that a buyer has to pay for at the moment of purchase of a flat, but which will be used in a more individual manner, have proven to be even more popular among flat seekers. One in three respondents is willing to pay an extra one-off fee of PLN 500 on top of the price of the flat for the option of charging an electric car in the underground garage, PLN 2,400 for keeping a bike on a wall mount in the underground garage, or PLN 400 for a parcel locker for couriers to deposit deliveries to be installed on the residential estate.
The REAS | JLL report also outlines a vision for modern cities of the future. The firm’s analysts have found that multi-functional property developments constructed for a multi-generation residential association, based on access to essential services and meeting most of the life services needs of residents, could generate development of the modern metropolis. Buyers’ developing needs could and should inspire developers to think of large residential estates and flat designs in this way.
- Our customers use smartphones to manage their own money, and therefore they have no problem accepting remote temperature control, lighting or flat access systems. Mobility is important to them, so they like to pay per minute to use cars or bikes. They are active and flexible, and instead of having a flat with a large dining room for receiving friends, they prefer to go to their favourite pub downstairs. We want to keep up with the trends and create suitable solutions for cities and city residents, so we have to consider a much larger number of variable and new trends than even 10 years ago. The times when developers could gain customers solely by adjusting prices and the size of flats are behind us – says Waldemar Olbryk, Head of Residential Business at Echo Investment.
Rental the answer to increasing mobility
An increasingly important factor shaping the residential market is greater mobility and less attachment to ownership. Eurostat research shows that from 2002 to 2007 only 4% of Poles changed their place of residence, while over the next 5 years (2008-2012) this figure was almost 10%. Changes on the labour market and a shift on the part of the young generation from ownership to general flexibility of choice (work, location and standard of their flat) are one of the main factors that led to greater interest in rental of flats.
- There is a systematic rise in the number of people who do not want to be tied to a place by buying a flat or to encumber the household budget with a long-term loan. Usually, these are young, mobile specialists who find it easy to change jobs and the place in which they live. They need a comfortable furnished flat with access to municipal services and a safe lease agreement – says Piotr Gromniak, Vice-President of Echo Investment, responsible for the residential rental platform Resi4Rent.
- The Polish rental market is changing but is still going through a development phase. In some respects, efficient institutional investors are needed to make it more civilised and promote it. Clear rental rules, a specific standard, and access to essential services are the elements that attract millennials, but also 30-35-year-olds who are still looking for the place in which they want to live. The next step in being “admitted to the club” are designs that combine these two types of residential function: rental and ownership. These will be exceptionally attractive to modern-day nomads who stop in one metropolis for a while and want to make full use of the freedom that comes with renting, but also want the feeling of belonging that a multi-cultural, open community provides – JLL expert Katarzyna Kuniewicz, says.
The survey was conducted by JLL and Obido on more than 7,000 people who were in the process of purchasing a flat.