Platforms such as Airbnb are expected to shape the future of the region’s property market.
Southeast Asian countries could soon overtake other developing nations by embracing new technologies that transform the way people live, work and play, revealed a JLL report. Growth in the region is expected to surpass the global average, with a rising middle class likely to form new habits.
The report looked at how advanced digital technologies could impact countries in the newly established ASEAN Economic Community. One such revelation was how home-sharing platforms such as Airbnb could improve how efficiently property is used. It may even lead to a drop in the number of hotel rooms in the region and increase the number of people who own second homes.
“In many ways, new technologies will allow people to bypass current constraints and leapfrog into greater efficiency. The impact on real estate and infrastructure in Southeast Asia is likely to be positive and transformational,” said Chris Fossick, JLL’s Managing Director, Singapore and South East Asia.
“If harnessed effectively, the changes will bring improved productivity, income levels and quality of life to the population.”
There could also be potential changes in the office market. Flexible work practices and an increase in co-sharing spaces could reduce the demand for office space throughout the region.
Regina Lim, National Director, Advisory and Research for Capital Markets at JLL, said: “While growth in demand for office space slowed after the global financial crisis, Southeast Asia has bucked the trend, with demand expected to grow at six percent per year until 2020 due to economic growth, further acceleration of outsourcing from developed markets, and the rise of the middle class.”
The report added that Southeast Asian economies are predicted to grow by five percent annually until 2020, higher than the global growth forecast of 3.5 percent.
Meanwhile, the urban population in Southeast Asia’s cities will increase by 2.2 percent annually, while the middle income population is set to grow by 70 million before the end of the decade.
This article was first published on DDproperty.com, Thailand’s leading property site.
