If there was one industry that desperately required the assistance of technology, it was real estate, and it arrived just in time. These days, technology is altering the real estate sector in more ways than one. Technology is making life easier and more convenient, from ‘Smart Cities’ to smart homes. According to an EY survey, real estate organizations are now aware that they must adapt to the changing technology landscape to remain relevant and achieve a competitive advantage.
From Artificial Intelligence (AI) to Virtual Reality (VR), technology is the terrain of the most recent innovations. Recently, a new word, WealthTech, was established to represent a modern business that has attracted billions of dollars in investment in a short period. This is linked to increased urbanization, which has increased demand, particularly from India’s middle class, whose lifestyle choices have altered considerably in the previous few years. The Indian middle class wants it all, from smartphones to smart homes, and the real estate sector has a huge opportunity to tap into this client base.
With the distinctive and rapidly increasing concept, the real estate sector has seen a tectonic transformation in the previous decade. ‘Fractional Ownership’ is enabling a new, safe, and profitable avenue of investment for retail investors in premium A-grade office real estate, which was previously out of reach for the middle class.
How did technology revolutionize real estate?
The advent of portals and algorithm-based value methods has shifted focus to the real estate market. Many new paths have been established in the WealthTech sector, and many start-ups have developed in India that are gaining pace. The adoption and evolution of technology-driven solutions in the residential real estate business have enormous potential. With many entrepreneurs introducing innovative solutions, the real estate business has only become better. Here’s how technology is changing the real estate market in India:
Tech startups leading from the front:
Tech startups not only bring the latest technology, but they also assist businesses with sales and marketing, which is one of the key ways investment can be drawn in this sector. Wealth Technology (WealthTech) has witnessed increased growth and demand since Covid-19. With the growing demand for tech-enabled real estate platforms, some trends, such as the usage of AI, machine learning, and robotic process automation (RPA), are expected to gain traction in 2021. Real estate stakeholders have benefited from the cloud service because they can now access documents for any property from any location. One of the leading startups in India that is taking advantage of technology-backed processes is Assetmonk. As an online platform that lists accessible and affordable commercial real estate assets via fractional investment and crowdfunding models after thorough due diligence, clients can track the progress of their investment assets via a comprehensive dashboard. This brings people closer to knowing the real-time status of their real estate investments.
The Influence of the Covid-19 Pandemic
Companies are investing extensively in WealthTech as more buyers venture into virtual mediums, particularly following the Covid-19-induced lockdown. In some ways, WealthTech is assisting the real estate sector in its recovery from a difficult phase in recent years.
Platforms for property search were already gaining traction, as millennials and young professionals discovered how simple it was to seek a property online, using only a mobile phone. With everything available online and a tremendous increase in smartphone usage, these tech-based enterprises may have a business opportunity to entice new buyers.
Calculations for costs and other factors
WealthTech and Big Data are assisting in cost savings and better profitability. AI can assist in property valuation by determining the rates of the property using a ‘predictive analysis’ algorithm. In this manner, investors can assess property worthy of growth and assess potential future dangers, in addition to comparing property rates.
Chatbots, virtual reality, and other technologies
Numerous property listing applications appeal to consumers who wish to buy or rent an apartment but don’t have much time to physically visit the property locations. With virtual and augmented reality, things are becoming more exciting as it provides customers with an immersive experience regarding the goods, which the main e-commerce platforms have already begun to use, and it will soon be the turn of the real estate sector to access this possibility.
Previously, real estate brokers would moderate all papers, and both the buyer and seller or landlord and tenant would have to complete significant paperwork. The procedure has now grown more efficient, with the majority of paperwork being digitally signed and approved by all stakeholders. Blockchain can also be a game-changer because records can be preserved decentralized, resulting in transparency and efficiency.
The Internet of Things (IoT) has advanced significantly in recent years, and some numerous products and gadgets may function in concert with one another within a home. People may use an app to manage their appliances, create reminders, and save money on their electricity bills. All of this necessitates contemporary infrastructure capable of accommodating and supporting this environment.
Technologies shaping the future of the real estate
Here are the top technologies transforming the real estate market, as well as the trends that are leading the way.
Real estate agencies are in charge of collecting and analyzing property data, which can be a time-consuming operation. Spending too much time collecting data means there isn’t enough time to analyze it to assist sales people, generate leads, and, eventually, close deals. Automation solutions can save agents a significant amount of time in a variety of ways. For example, agents can collect data more quickly and with less manual labor, and then integrate it with their insights to make better suggestions to clients.
Automation technologies can also help during the price stage of a transaction by accumulating pricing data from similar properties over time. Furthermore, it is not commonplace for agencies to include all of this information into an algorithm capable of automatically predicting selling prices in a given location. Automation technologies are a powerful approach for agents and their clients to reduce wasteful back-and-forth and make faster decisions based on up-to-date market data. The advantages of automated technology also extend to real estate agents’ marketing activities, allowing them to send social media postings, advertising, emails, and text messages to prospects while they are out meeting with clients in person.
The Internet of Things (IoT)
The Internet of Things, or IoT, refers to the billions of physical devices that are now connected to the Internet and collecting and exchanging data throughout the world. Property managers and owners in the real estate market are adopting IoT devices to monitor and control various aspects of a property and its surroundings, such as temperature, air quality, lighting levels, security systems, etc.
The capacity to control these variables in real-time has various benefits. IoT devices, for example, can give property managers information into occupant behavior and energy usage, allowing them to be more proactive in property upkeep and repair.
Augmented Reality and Virtual Reality
The real estate sector is no stranger to augmented reality (AR) and virtual reality (VR) technology. However, from real estate advertising to home tours, AR and VR applications are constantly improving and gaining acceptance. The VR and AR real estate market is estimated to reach at least US$80 billion by 2025. The applications of augmented reality and virtual reality in real estate are as numerous as the technologies themselves. VR headsets, for example, are being used in conjunction with 360-degree cameras to generate virtual designs of properties. Real estate agents are also providing buyers with new options to view homes using VR headsets.
There are also AR programs that allow property owners to see how furniture and furnishings will appear in real-time, as well as those that allow agencies to build augmented adverts on properties (though this use of AR is raising some concerns).
Agents are already providing virtual tours of properties to purchasers, which is especially useful for out-of-town buyers. Without having to go, people may genuinely experience what it’s like to walk into the property for themselves.
A blockchain is a digital, public ledger that uses cryptographic security features to record transactions in a verifiable manner, eliminating the need for a third-party record-keeper. Blockchain technology, which serves as the foundation for digital currencies such as bitcoin, has a variety of potential applications in the real estate business. Aside from enabling property transactions, blockchain technology has the potential to be a helpful solution to industry fraud, particularly in underdeveloped nations where real estate and land record fraud is rampant. For the time being, the major use cases of blockchain technology in real estate are speeding and confirming property contracts and registration. Its potential, however, remains largely unexplored, and as the technology evolves, it will surely benefit the real estate market.
While the technologies indicated above are undoubtedly transforming the real estate sector, this is not an entire list. As the industry transitions into the digital age, new resources and platforms are constantly emerging to assist both buyers and sellers. The goal will be to encourage the adoption of these new technologies so that all stakeholders may benefit from more accurate information and, as a result, make more informed and profitable decisions. Given the consumer need for more technology in the real estate sector, we may expect to see more agents and brokerages invest in cutting-edge technology to compete in the market.