Self driving / Autonomous Vehicles - Impact Real Estate?

[Shane Mcc]

How do you think self driving / autonomous vehicles will impact the value of real estate? 

[Michael Seeker]

@Shane Mcc - this is an interesting question that I've given some thought to but never really had a fruitful debate on.  Hopefully this thread garners some interest...anyhow, here are a couple thoughts:

1. Self-driving cars are a solid 5-10 years away and maybe another 10 years from a more wide-scale adoption that might start impacting real estate decisions.  So I wouldn't foresee any major trends starting to take shape for at least 10-20 years.

2. In many bigger cities there has been an urban revival in the past 10(ish) years.  You see a lot of people starting families inside the loop instead of out in the burbs.  There have got to be a lot of factors that play into this, but the biggest two for me have been convenience (want to be close to downtown, restaurants, bars, etc.) and architecture (it's impossible to find beautiful turn of the century homes in the burbs that were built between 60's and 00's).

Given 1 and 2, I would expect to see a sort of suburban revival in 20(ish) years.  Once people can dial up a car and then play with whatever the trending smart gadget is at the time while they commute, the appeal of being a 5 minute drive from everything won't be significantly better than being a 20 minute ride away.  The pricing dynamic between urban and suburban should be disjointed enough to encourage people to spend less for more moving out of town again (just like the arrival of the car and cheap gas).

It might also lead to more suburban sprawl, i.e. building outside of the 2nd and 3rd loops of cities.  Cheap farmland within an hour of major downtown cores might appreciate quickly if this occurs.

That being said, people generally want to live somewhere safe that is close to where they work and where they play.  Driverless cars should reduce or eliminate the pain points of a long commute, but it's not likely to push major commercial development out of the urban core as aggressively (after-all, you need people/traffic in a close proximity for brick and mortar businesses to succeed).

I imagine driverless cars will bring about some changes to the RE market, but I don't think they'll happen all that quickly.