Over the past six years, real estate markets in Gainesville and across Florida have strengthened, but not for a reason many would expect.
According to Tim Becker, director of the University of Florida Kelley A. Bergstrom Real Estate Center at the Warrington College of Business, the slow growth of the U.S. economy has allowed for the strengthening of the local and state real estate markets.
“Counterintuitive to what many learn in business school, the U.S. economy’s slow growth has actually been helpful for [real estate] and has kept us from over-building,” he said.
While the U.S. economy has seen slower growth, Florida’s economy is actually better than most states. As tourism continues to grow and more people come in to the state, the real estate market’s growth follows. In fact, according to Becker, the state is bringing in a little less than 1,000 people per day. If that trend continues, the state will continue to see successes in both the economy and real estate market, he said.
The Gainesville real estate market typically mimics that of the state, Becker added. However, the city is at a tipping point, he said, and change is riding on a couple of factors.
First, he said, is the success of Innovation Square.
“Can we truly become a city that can retain startup ventures and the people who fund them?” Becker asks.
Second, in relation to the success of startup companies that call Gainesville home, can we provide an environment in which young professionals and others want to stay?
“Gainesville is missing the kind of housing young professionals want to live in,” Becker said. “We have plenty of student housing options, but that’s not where [young professionals] want to live. We need other kinds of housing for those who come to Gainesville to work, and it needs to be affordable.”
Becker adds that housing is a big contributor for office companies’ real estate decisions. Companies choose locations close to where CEOs and upper management want to live. For example, companies might consider office space at the new development Celebration Pointe because of its proximity to Haile Plantation, resulting in a shorter and easier commute for top management.
Becker also cites transportation and technology as other factors that will play a part of the development of the Gainesville real estate market growth, including the implementation of autonomous vehicles.
While Gainesville’s real estate market is on the cusp of change, Becker predicts that 2018 will likely be a continuation of what we’ve seen in 2017.
“We always ask the members of the UF Bergstrom Center Real Estate Advisory Board what they think is going to happen next that could become an issue for our industry,” Becker said. “Most are confident that 2018 and 2019 will continue to be positive.”
Becker notes, though, that as the state’s population grows so will the need for housing, retail and office space. As long as the industry maintains its discipline and continues to not overdevelop, then it will likely remain in good shape, he said.
While members of the real estate community predict 2018 will continue to be a positive year for the industry, they’re interested in what could come in the next 5 to 10 years. For that reason, the Bergstrom Center at UF created the Real Estate Trends and Strategies Conference.
Each year at the Trends and Strategies Conference, about 450 industry professionals come together to discuss the future of real estate, network with the best in the industry and host an exciting line up of speakers.
Some of the planned topics for the 2018 Trends and Strategies Conference, according to Becker, include the state of the economy, the impact of technology on the real estate industry, investing trends in the retail sector, and diversity in the industry, among others.
“People are really able to join in on the conversation about the future of the industry and learn where experts are putting their money,” Becker said. “Overall, the conference is about bringing ideas from many different people and places so that attendees can bring those ideas to their own communities.”
The UF Bergstrom Center Real Estate Trends and Strategies Conference will be held March 1-2, 2018 at the Waldorf Astoria in Orlando. To register or learn more, please visit www.warrington.ufl.edu/centers/cres/events/2018_trends/.
Allison Alsup is a Public Relations Specialist in Marketing & Communication Services with the Warrington College of Business at the University of Florida.
By Allison Alsup