That is because the internet is what largely has made real estate more valuable.
In pre-internet times, people shared real estate. Bars, restaurants, church, etc. Their discretionary income went into the fees, offerings, etc. to make these places comfortable. With the rise of the internet, people started preferring to stay home to use the internet. All that discretionary income once spent on fuelling those third places is now competing for each own's individual domain, thus driving up the price where individuals are found.
Two years of COVID exacerbated things because even those who still got out of the house from time to time were forced to stay home, so what remaining money was still funnelling out to activities outside of the home was entirely redirected into individual real estate.
The pin that pokes a hole in this theory is that commercial rents, at least in my part of the world in an expensive city, have risen faster than residential. Presumably this wouldn’t be the case if those third places were in such rapid decline.
Also, I’m pretty tightly involved in the local bar and hospitality scene, and most places are doing just fine — not quite pre-COVID levels at a number of places, but some are busier than ever.
> not quite pre-COVID levels at a number of places, but some are busier than ever.
The real estate bubble, if we are to call it that, goes back to the early 2000s at least. Pre-COVID, implying somewhere around 2019, isn't telling. For what it is worth, the housing price data I have in front of me shows that prices have come back down to nearly pre-COVID levels as well, so that more or less tracks anyway.
How does it compare to the 1990s? The landscape has definitely changed here. A couple of decades ago there were three busy bars mere steps from my place. Now, there isn't a single bar in town. Those closures brought consolidation to bars found in the next town over, which saw them thrive there, but now the decline is staring to become visible there too. The next, next town over is probably busier than ever as a result with even more consolidation slowly starting to take place, I can believe you there, but that doesn't imply general strength of the industry.
The media regularly reports on the dying death of the third place. Your local experience may not be providing an accurate picture.
In pre-internet times, people shared real estate. Bars, restaurants, church, etc. Their discretionary income went into the fees, offerings, etc. to make these places comfortable. With the rise of the internet, people started preferring to stay home to use the internet. All that discretionary income once spent on fuelling those third places is now competing for each own's individual domain, thus driving up the price where individuals are found.
Two years of COVID exacerbated things because even those who still got out of the house from time to time were forced to stay home, so what remaining money was still funnelling out to activities outside of the home was entirely redirected into individual real estate.