Emerging Trends

REAL ESTATE

Location, Location, Quality of Life

Creating Nations Within Nations

Emerging Trends:

As described by the WSJ (Jan 2008), gentrification is taking on a whole new meaning: broad swaths of rural America are being gussied up by baby boomers who are buying up retirement property well before retirement along with other wealthy global nomads who now own 4 homes on 5 continents. OK 5 homes. Who’s counting? 

Wireless telecommunication is allowing us to operate from more and further remote locations. The migration of Californians up the coast to Oregon in the 1980s for better quality of life will pale in comparison to the global form this will take in the next 10 years. The combination of the high US dollar through the last 20 years and relatively low real estate values in some parts of Canada caused almost all the prime coastal properties in Nova Scotia to be sold to US citizens from as far away as S. Carolina and Oregon, as well as to Germans and British.  But in Nova Scotia, it was only the coastal properties that the wealthy nomads sought.   A nation within a nation formed on the South Shore of Nova Scotia. The full political, social, and economic impacts of this are not fully clear, except that waterfront properties that sold for $30,000 in 1998 were selling for $150,000 in 2000 and jumped to an average of $400K by 2007 and even with the weak US dollar in 2007 they are still a bargain by US coastal standards.  

The trend will focus next on the remote Caribbean islands like Saba and before long Bhutan and Iceland (Don’t laugh. It may be cold, but it’s hip and they can party) and then next thing you know, some remote village in Kenya will host Bill Gates’s daughter working out of her totally wired global dot com headquarters.

Next Opportunities:

If you are looking to invest in your 3-4 home and have got the first two in two cities, you cannot look far away enough; the ideal combination being remote but with an airport within a 3 hour drive. Look for small communities with rich local history and culture (rural, ranching, fishing, artist communities are favorites), and limited road access is another plus. Satellites, wireless telecommunication and Web phones will take care of the rest. 

And if you are part of one of these communities, beware, take necessary precautions soon.  Take measures to safeguard your unique community life style and culture from invasion through land banking or other legal, zoning mechanisms. Or make the best of it, go global and reap the benefits of joining the global economy.  If you go for the latter, be ready for SUVs, extreme sports outfits and the ubiquitous kayaks and mountain bikes to take over your back yard.  Be warned, you may have a former dot commer or Wall Street lawyer running your town hall after the next election.  

This phenomenon is going to sweep the globe much faster than people are ready for.  Nova Scotia and Costa Rica will attest to that.  Tibet may be next.  Either way,  a cross section of professional and service opportunities abound for real estate lawyers, builders, investors and small scale entrepreneurs.  Revitalization of forgotten mill towns and fishing villages through increased taxation and inflow of money is happening and will continue apace.  After reading Shipping News, who would think of buying property up Labrador?  Yet, it is fast being recolonized.  It is wild and authentic and remote.  The three key ingredients for the 4^th home away from it all, even if it’s for just 2 weeks a year. 

This life style may be mostly for the dot com millionaires, but the trickle down benefits can be capitalized on by many.  Just ask the realtors in once sleepy old Lunenburg, Nova Scotia who 10 years ago literally could not give property away, especially if it was on an island.  Today they have few homes left to sell below $500K from their waterfront inventory and the demand keeps increasing!

Let your imagination run.

Create the future and smell the roses, it’s your move!