The covid pandemic and subsequent lockdowns forced us to change the way we work. Zoom meetings were a regular occurrence, a home office became the norm and many businesses began to realise that many workers could be just as productive from the comfort of their living rooms, as they could be in the workplace.

But a by-product of remote working was a move away from our CBDs, and less face time and cohesion for a lot of teams. Now big organisations like Amazon and our government agencies are choosing to reverse working from home policies to get people back into the office.

Chris Farhi, Bayleys Head of Insights and Data says those big overseas companies are often the trend setters for workplace strategies.

“Amazon recently ordered its staff back to the office five days a week, whereas previously they were allowed to work from home two days a week.”

“It’s no surprise we’ve seen the NZ government follow suit by calling their workers back and setting an expectation that working from home arrangements aren’t an entitlement.”

Farhi says most government departments have employees based in Wellington, but there’s also a significant presence in other major cities like Auckland and Christchurch too. Most offices are positioned in the heart of those locations, but hybrid working patterns during the pandemic enabled people to easily purchase property on the outskirts or in the regions.

“It also supported a heightened demand for lifestyle properties and semi-permanent homes in holiday locations like Queenstown-Lakes, Coromandel and Northland particularly due to their affordability and a reduced need to be physically in the office.”

While the change in hybrid working policies will have a big impact on the population of our inner-city office spaces, Farhi says it’s also likely to have a big impact on the housing market too.

“I think we’ll start to see an increase in demand for housing in major urban areas to reduce commute times, and also a demand for housing in locations with strong public transport links.”

With the highest concentration of government workers in the capital, Farhi expects Wellington to be the most significantly impacted market in the short term and a trend-setter for the rest of the country.

So what can we expect from the windy city?

WHAT WILL HAPPEN IN WELLINGTON'S CBD?

Bayleys Wellington Regional General Manager Grant Henderson has been witnessing the effects of the change in working patterns first hand.

“What we're seeing is a more upbeat city. The city's getting more vibrant and there’s more foot traffic.”

Henderson doesn’t expect an influx of people to sell up in the outer areas, but believes we’ll see the most movement in the rental market.

“I think that those who have bought outside of the city have chosen to do so for the lifestyle. They’ve laid down roots, and I can’t see them throwing that away.”

“But if you've been renting a property out of the central city, I think people will want to move back and there'll be more demand for rentals in town.”

That also means an opportunity for investors.

“People will weigh up living in the Hutt which could cost $500 per week compared to $700 per week in the central city. But then they’ve got to use their car to drive into work which could end up costing $200 per week, and at that point they’ll be thinking they may as well live closer to their office in the city.”

While they may not be right in the heart of the city, Henderson says some developments that are close to it are also becoming available.

“They're about 18 months away, but there’s around 40 two and three-bedroom townhouses that will be coming to market in Newlands.”

“They’ll definitely be suitable for investors, and they’ll get snapped up.”

WHAT ABOUT THE OUTER SUBURBS?

Henderson says while there will be a lot of movement back into the CBD as working habits change, there’ll still be demand for housing in the outer suburbs and areas too.

“I believe that people are looking at their overall lifestyle over and above just the ability to work from home, so there is still a push for suburbs.”

There are big sale drives for the Kapiti Coast, and the Upper Hutt area, and the price point is anywhere from $550,000 to $750,000 so it’s selling strongly.”

While a move back into the office means more time spent in the car and more money on petrol, Henderson says those living away from the CBD will be taking the overall value proposition into consideration.

“They’re looking for schooling, they’re looking for lifestyle and they’re thinking they will pay over a million for a place in the city but get the same thing in Upper Hutt for $750,000.”

With improvements made to roading infrastructure Henderson says a lot of the stress of the commute has been reduced too.

“If you live on the Kapiti Coast, and you're driving on the Transmission Gully, it doesn’t take you much longer to get into town than if you were driving from Karori or from the eastern suburbs, because that main motorway network is so well provided for.”

“The fact that house prices have come down a bit, and interest rates are falling means any increase in expenditure to get back to the office is probably going to be offset by all of that too.”

WHAT ABOUT THE REST OF NEW ZEALAND?

According to data from last year’s census, people who worked from home made up nearly 18 percent of the working population, compared with just under 12 percent in 2018.

The working from home population in Wellington and Auckland nearly doubled in that time, and most regions reported an increase.

Chris Farhi expects holiday home locations and regions with the highest levels of remote workers to be impacted the most.

“In Auckland there’s a large professional services workforce spread across a large geographic area, and traffic congestion contributed to people wanting to do hybrid work.”

“The holiday home locations that have also seen a massive boost in hybrid work patterns are Coromandel and Northland, while in the South Island a mix of lifestyle and affordability has increased the number of remote workers in Queenstown, Christchurch, Nelson, Tasman and Marlborough.”

But with many people having paid high prices for their homes during the pandemic, Farhi says some may prefer to hold onto their remote properties and rent them out for the time being while they move closer to their workplace and wait for the market to pick up.