Together with housing market experts, we have collected several types of apartments that will lose popularity in 2023
The general decline in household income will be the main factor determining the preferences of apartment buyers in 2023. Instead of multi-room expensive lots, some of them will consider suburban housing. Interest in apartments on the highest floors may also decrease, which, according to experts, are 20% more expensive.
Together with housing market experts, we talk about the types of apartments that will attract buyers less next year.
Unsuccessful and non-functional layouts
Over the past few years, apartment buyers have been evaluating planning solutions with particular care. Here the rule applies: get as many “working” square meters as possible for your money. That is why developers often present dozens of planning solutions within the framework of one project. The trend for functional layouts will intensify in 2023, and it will be more and more difficult to sell apartments with an unsuccessful layout, experts say. Apartments with poor ergonomics are already losing a buyer, especially if such shortcomings are unremovable, said Irina Dobrokhotova, chairman of the board of directors of Best Novostroy.
“Such shortcomings as low ceilings, long corridors, dark corners, and narrow niches in which it is impossible to arrange furniture cannot be eliminated; rectangular rooms also do not allow you to “turn around” with competent furniture. A small kitchen and one bathroom in a three-room apartment, even a comfort class, already seems like nonsense, ”she explained.
Less popular in 2023 will be objects in old houses with a non-functional layout, Dmitry Alekseev, head of the primary real estate department, agrees with her. For example, apartments with small kitchens and walk-through rooms. Today it is a relic of the past, and it becomes more difficult to sell such options every year.
The situation is similar to large luxury apartments that were designed in the 2000s. For example, when there are only three windows in a huge apartment (150 sq.m.). For a modern buyer who is used to large windows, such apartments look unattractive.
Apartments without renovation
Furnished apartments have become mainstream in the housing market. According to experts, in August, a monthly record was set for sales of apartments with finishing within the boundaries of L.A.: they grew by 65% in the whole market, and in the business class – by 73%. Now, lots with finishing, according to various estimates, in the capital account for up to 40% of the total supply. According to experts, the popularity of apartments with finishing in 2023 will continue to grow, and without it – to decline.
Buyers do not want to waste time on repairs and do dirty work. Moreover, finishing is immediately included in the mortgage loan, which allows you not to spend money on repairs. “Gradually, although not in 2023, new buildings will come to the point that apartments will no longer be rented out without repair. Only with a white box or a turnkey finish, this is a world practice,” says Jane.
Studios and small spaces
Due to the COVID-19 pandemic, the popularity of studios has also been shaken in 2020-2022, and this year it may decline even more, experts say. Such apartments are well suited for single-person living, but often couples or even families with children live in studios, and after switching to remote work, it turned out to be difficult to work in such conditions.
“Therefore, when renting an apartment, and then when buying, customers are increasingly interested in layouts where they can allocate separate spaces for work. Otherwise, preference will be given to projects with co-working spaces – such examples are already on the market, ”said Victoria.
According to her, if several members of the family at once work remotely even several days a week, then ultimately this will require the expansion of living space. The trend to buy apartments with a separate workspace will not develop until the second half of 2023. “In order to buy an apartment with a larger area for working remotely, buyers will more often consider more remote areas of the city – this will expand the space while maintaining the budget,” the analysts believe.
Now the share of studios in total sales is low. According to analysts apartments up to 30 sq. m in 2021 accounted for 7.2% of transactions, in 2022 – 7.9%. According to statistics, in L.A. demand for lots less than 30 sq. m. m is about 11% in comfort class and about 6% in business class. The main demand is still distributed to apartments from 30 to 70 square meters.
Too big apartments
Along with studios, the popularity of too large and expensive apartments (150–200 sq.m.) will decrease. Instead, buyers will choose country houses, experts say.
“According to my observations, in the face of past epidemiological situations and a decrease in income, the interest of some target buyers of such objects has shifted towards suburban housing. In particular, ready-made cottages with all communications. This option of living seems to people more comfortable and safe,” said Mike.
A similar situation will be observed with exclusive apartments, which have lost popularity in the last two years. We are talking about exclusive or pretentious repairs (for example, when there is a lot of gold, and columns in the interior) and an unusual layout. (for example, a sauna instead of a bathroom or a cinema room). Finding a buyer for such lots is becoming increasingly difficult.
Inflated price tags
Apartments that are difficult to sell at all times are overpriced lots, and 2023 will be no exception in this regard. According to Mike, now about 35% of objects in the L.A. secondary housing market do not find buyers just because of the inflated offer price. Such lots hang in ads for months, and as a result, the seller is forced to either reduce the price or withdraw it from the sale.
“Objects that traditionally practically do not attract the attention of buyers are overvalued by apartment sellers, regardless of their room size and condition. In addition, in connection with recent events, the solvency of some potential buyers has generally worsened, and in such conditions, people are not ready to even overpay minimally for an apartment they like, ”explained Mike.
Apartments on the highest floors
Big cities is growing more and more upwards. Houses with more than 30 floors are no longer surprising. On the one hand, apartments on the upper floors impress with their view and low noise level, but on the other hand, the overpayment for such housing can reach 20%. And the majority of buyers still prefer apartments located mainly on floors from the 5th to the 15th, said Daniel.
“I suppose that given the oversaturation of the market with high-rise buildings, apartments on high floors will lose popularity, and buyers will give preference to the lower floors. Thus, the fashionable format of apartments with panoramic views will lose its relevance and give way to low-rise houses,” he predicts.
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