It's possible that Americans simply won't take well to the advent of autonomous vehicles, and self-driving cars will end up flopping as hard and as fast as previously hyped gadgets like Google Glasses, Segways and Nintendo Virtual Boys. But it's also equally likely that the technology will prove as impactful as the cellular phone, not only revolutionizing the world of automotive transportation, but also disrupting, creating and even killing off whole scores of other industries - including residential real estate.
How? Data and analytics firm CB Insights recently investigated the ways in which driverless cars could possibly affect nearly three dozen different industries, with findings that ranged from the obvious to the "huh, I never thought of that."
For example, you don't have to be a futurist to predict that autonomous technology could render obsolete the jobs of truckers, chauffeurs, cabbies and delivery drivers, while also drying up opportunities for their gig economy counterparts at places like Uber and Doordash.
However, you might not have imagined that driverless cars could also one day be blamed for a decrease in gym memberships. Yet one engineer told the New York Times that the rigidity of a vehicle's interior makes it ideal for exercise, meaning some health nuts might opt to convert their daily driver into a "full weight room on wheels." (No word yet on where drivers would install a shower).
Hitting close to home
Of particular note for homeowners, though, is the profound effect that self-driving automobiles could have on the real estate industry.
Currently, homes located near major transit hubs such as train stations and subway lines are highly valued, as most commuters balk at the idea of living in the suburbs and enduring daily rush hours, congested downtown traffic and countless parking headaches. But driverless vehicles make it possible for you to sleep, read or watch a movie during your trip to the office, which should also be drastically shortened by improved traffic flow. Furthermore, private vehicle ownership will continue to decline as autonomous ridesharing services and even self-driving buses proliferate, meaning parking and other hassles associated with driving to work will eventually fade mercifully from memory.
Even the value of owning property in a hip or up-and-coming neighborhood could be largely negated by autonomous vehicles, as more convenient transportation makes everything feel closer. Suburbanites can go out to big-city bars and other nightlife destinations completely risk-free as self-driving cars could theoretically eliminate incidents of drunk driving.
There goes the neighborhood('s high property values)
In short, because driverless cars will make long commutes much more efficient and relaxing, the old real estate mantra of "location, location, location" will eventually carry less importance. And while that is great news for homeowners currently paying off their mortgage on a modest domicile in the 'burbs, it may be a troubling development for those who paid a premium when moving into a trendy, urban location.
In addition to lowering the demand for urban housing, autonomous vehicles could also drastically increase the supply of said real estate.
Private car ownership and commuter culture presently drives a huge need for parking in America. A recent report by the architectural firm Gensler notes that the United States currently has an estimated 500 million parking spaces, which represent more land than Delaware and Rhode Island combined. If personal vehicles are largely supplanted by fleets of publicly shared self-driving cars—which Gensler argues could happen as early as the year 2030—that land could be repurposed.
Some parking lots and garages will surely be used for commercial purposes, but many will likely be converted into apartment complexes, easing the inventory crunches that currently exist in many of our major cities, and, consequently, lowering the value of urban residential property.
It seems that this decline in urban housing costs and increase in suburban property value could begin in earnest within the next decade, so if you want to stay ahead of the curve, now may be the time to invest in a nice house in the suburbs.
For more info on financing a mortgage, contact Landmark Bank.
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