andra ghent

Professor of Finance

When the world shut down in March 2020, everyone went to the same place — home. Whether that home was near or, in a few cases, a relocation to a di erent state or country, it has had a major impact on real estate markets across the country.

The work-from-home shock has a ected residential real estate everywhere, according to expert Andra Ghent. There is huge pressure on suburban home prices, and builders have not had a chance to develop new supply.

The commercial real estate market has also seen a shift as a result of the pandemic, but it’s important not to extrapolate too much from high-cost cities like New York and San Francisco, Ghent cautions. While remote work has not been great for commercial real estate owners, it hasn’t been quite as big of a shock in less expensive cities. Furthermore, excess o ce space tends to get absorbed over time. Cities with longer commute times and a higher share of workers in remote-capable occupations tend to have a higher demand for remote work.

Ghent is currently working on a project studying the return to work and its impact on o ce demand as companies make announcements calling employees back into the o ce. She believes that overall, the percentage of employers who remain 100% remote will be quite small. Even as most workers return to the o ce, that workspace may not look the same, Ghent said. Being apart increased appreciation for the social aspect of working in person. People are craving more opportunities to connect with peers, and even meet potential partners and friends, in a way they took for granted before the pandemic. Older workers, however, are tending to prefer remote work. As a result, we can expect to see a rise in communal o ce designs, Ghent said, with an emphasis on collaborative spaces.

Ghent has immersed herself in the Utah real estate scene since joining the Eccles School in 2021. She currently serves on the Salt Lake City Planning Commission, lending her expertise to solve the unique issues caused by Utah’s exploding population. Topographic supply chain constraints and land use constraints imposed by Utah cities make it di cult to build in the state, especially when it comes to residential real estate inventory.

Housing a ordability is a huge issue both in Utah and across the country. While the pandemic had an impact, it is not the root cause, Ghent said. The long-term issue is that median renter wages have not increased in 40 years. Renters tend to come from the lower half of the income distribution, and while the costs of construction have gone up, families have not seen wages rising at the same rate. Ghent believes smaller homes could be a big part of the solution. In addition to legalizing missing middle housing, she advocates for allowing accessory dwelling units such as guest houses or mother-in-law apartments as a potential solution. “Accessory dwelling units are a great solution for aging adults or adult children with disabilities,” Ghent said. “Allowing them without restrictions like requiring owner-occupancy is a very family-friendly policy.”