Here’s a great example on why and how disruption (see my other post on the four stages of disruption) introduced by autonomous cars is going to affect real-estate values. Let’s go back to the original quote from Benedict Evans
“I still think that autonomous cars will create more billionaires in real estate and retail than in tech or manufacturing - just like cars did.”
In a nutshell
A lot has been written about the “first order” effects of autonomous vehicles: How they will reduce traffic fatalities, make rides more comfortable, or put truck drivers out of work.
But the bigger story here is the “second order” effects — how improvements in mobility will cause us to reexamine fundamental assumptions of how we live.
Let’s start with real estate. Cars (the Henry Ford kind) completely reshaped the built environment of the United States — giving us the suburbs, shopping malls and pulling people out of cities. What will self-driving cars do to our cities and suburbs? Surely something equally as dramatic.
“Property values will shift from properties with a convenience premium reflected in their current price (e.g. near public transit, short commute) to properties that currently have an inconvenience penalty baked into their price(e.g. long commute, far from city center).”
Public Transit: A value driver no more. Historically, proximity to public transit has had a favorable impact on real estate prices. Real estate near transit is likely to be a loser in the coming shift to AVs. The “premium” from transit proximity will shrink as autonomous vehicles eat away at usage, particularly for rail lines
Here is the article >>>
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My name's phil mora and I blog about the things I love: fitness, hacking work, tech and anything holistic.
Head of Product and VP Engineering at Sikka Software
thinker, doer, designer, coder, leader.