Emergent technologies are making a big impact on the real estate industry and dramatically revolutionizing the way real estate agents, brokers, investors, and managers conduct their daily business. As funding for real estate property technology—now referred to as ‘Proptech’—ramps up annually, there are more and more companies rolling out innovative technologies. Additionally, social and digital powerhouses like Facebook and Amazon have also made significant contributions to the developing adaptations in real estate-focused tech.
Considering all the rapid advancements, real estate investors should pay attention to tech trends in the real estate space so they can take advantage of the efficiency it offers and get an edge on the competition in an increasingly crowded market. Here are a few to pay attention to in the near future.
Big data is one of the most significant technology trends within the real estate industry. This aggregated data is used to premise future market fluctuations and trends related to customer behavior and buying patterns. In the future, this compilation of data could involve utilizing CRM apps that indicate when a potential buyer visits your listed property or webpage and garner data based on their activity. This feedback could then be used to model when a prospective client may be contemplating purchasing your investment asset or the price point you should list your property at to optimize return on investment (ROI).
Property management software has largely shifted to cloud-based applications as it provides a host of benefits including enhanced ability to grow and scale, increased accessibility for involved parties, a more secure connection, cost savings and upgraded efficiency. These cloud platforms enable landlords and tenants to access information regarding financial obligations, repairs and more around the clock, improving communication and resolving issues before they snowball out of control.
Blockchain has a lot more to offer than just cryptocurrencies. This unique technology is essentially a digitized public ledger that actively records all transactions, without the need for banks to verify each and every transfer. Cutting out the middleman results in reduced title issues and legal complications in addition to an expedited settlement timeline. Investors can anticipate more and more property transactions to be completed via blockchain in the coming years.
Virtual (VR) & Augmented Reality (AR)
VR and AR have been increasingly featured in a real estate context—particularly with the complications presented by COVID-19 and subsequent social distancing measures. These technologies allow prospective tenants and homebuyers to take a virtual tour of a property at a time that suits their schedule without having to physically travel to the property itself. This saves time and money for both real estate agents and their clients. Brokers and builders can leverage AR and VR to market unfinished spaces to enable future buyers to customize the space according to their personal preferences. According to a recent poll by the National Association of Realtors (NAR), 44% of clients search for properties on the internet that feature VR and AR capabilities before deciding which ones to visit in person.
Fractional property investment is a growing trend in the real estate space that is expected to significantly alter long-term strategies. These online platforms allow investors to acquire fractional shares of a single property. Because a group of real estate investors collectively own a piece of real estate, they all share the profits of either the rent or eventual sale of the property. The value and cost of these shares will increase as the property value grows. This method of investing reduces the financial barrier of entry to investing and allows individuals with limited budgets the opportunity to generate passive income.
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