Technology has contributed to the disruptive transformation of numerous industries. Over the years, sectors like retail, marketing, and finance have seen technology alter the status quo and introduce new players to their respective industries.
In real estate, a new wave of innovation is also transforming the industry. A leading luxury real estate developer has seen the integration of technology result in a disruption in how real estate services design, construct, and buy and sell buildings and property.
Like the sectors mentioned above, the intersection of real estate and technology has been given a new term – proptech.
What is proptech?
Short for property technology, proptech describes technological offerings or services within the real estate space. The technologically innovative products range from software and hardware to manufacturing and materials. This technological movement enables real estate services to be more efficient and addresses new consumption patterns and consumer demands.
Like fintech (financial technology) and martech (marketing technology) before it, proptech represents a digital revolution and a mentality shift in an industry resistant to change. The use of technology in real estate allows developers and property operators to offer existing real estate services at lower costs while providing new tech-driven solutions at the same time.
Current trends in real estate technology
The following proptech trends provide an overview of how the real estate industry is discovering new innovative ideas through the use of technology.
1. Information aggregators
Whether it’s residential or commercial property, listing portals like JustProperty.com in the UAE and Rightmove in the UK have been instrumental in the sales and letting of real estate. Technology enterprises such as these help brokers, developers, agents, property developers, and investors to improve access to real estate information.
These information aggregator tools give real estate professionals the ability to easily access qualified home seekers looking to connect with a local and trusted realtor. Property portals also greatly benefit buyers, providing various tools and resources that allow consumers to sort through pertinent data to make an informed decision quickly.
2. Data optimisation
The analysis of data allows real estate developers to discover trends and insights that lead to better business decisions.
For DAMAC Properties, the use of a CRM (customer relationship management) tool like Salesforce has enabled the organisation to gain new insights and approaches to more efficiently serve its customers and deliver bespoke customer-centric property solutions.
In other sectors of real estate, data optimisation is used to determine the potential value and buying and selling trends of individual neighbourhoods and specific areas. Gathering real-time and historical data helps reduce risk when it comes to divesting or capturing real estate investments.
3. Building information modeling
In construction, the proptech trend of building information modeling or BIM allows architecture, engineering, and construction (AEC) professionals access to information and tools that allow for better design decisions and the efficient and collaborative management of the project’s lifecycle.
BIM uses an advanced 3D model-based process to plan, design, and construct a building.
Using intelligent 3D modeling allows AEC professionals to analyse every detail of the building. The model can inform project planning and conceptual design, helping stakeholders and investors visualise the entire project before the shovel strikes the ground.
Managing the design and construction of a project through a central, shared ‘master’ model improves coordination and automates clash detection.
This close collaborative environment not only mitigates risk, but it also improves scheduling and sequencing during the construction phase, reducing labour and material costs while increasing productivity.
4. Artificial intelligence
Like many other industries before, artificial intelligence (AI) is quickly becoming a de facto requirement in real estate. AI-based innovations serve numerous purposes, from making data more actionable to making the buying experience more efficient.
Currently, AI is being used in information management and lead generation.
The former uses advanced AI-powered software to analyse and provide comprehensive information to prospective clients. As mentioned, combining marketplace data and CRM allows agents and brokers to synthesise information regarding a specific area or neighbourhood.
The data analysis functionality of AI also helps agents and brokers better manage financial and loan modeling with less manual input. AI tools aggregate all of the data sources, analysing the relevant data to forecast risk and predict pricing trends more accurately.
On the lead generation side, several companies are also using AI to digitise the buying experience.
The use of chatbots, a type of computer program used to initiate online chat conversations, helps augment the sales journey, providing customers with customer support questions that allow agents to qualify leads and provide personalized offerings based on the customer’s responses and preferences.
5. Virtual and augmented reality
Considered by many as real game-changers, virtual reality (VR) and augmented reality (AR) are transforming how agents deliver superior services.
As visual perception is a critical exercise in how real estate is performed, particularly in the residential sector, VR and AR technologies transform the way agents showcase and sell real estate.
The advantages of adopting such technologies include cost- and time-effectiveness, increasing global outreach, and enhancing the customer experience.
Rather than prospective clients scheduling a physical visit, agents can provide a virtual walkthrough with the use of a mobile device and a VR headset. This eliminates the long buyer journey and allows the prospective client to visit multiple properties through an immersive and exciting experience.
It’s not just the buyers, though, that benefit from the use of a VR showcase. Similar to BIM, reality technologies are empowering AEC professionals to superimpose architectural models and designs on images of real-world built environments.
This form of architectural visualisation helps investors and contractors capture the dimensions in an entirely simulated environment.
Developers and AEC professionals can better communicate complex information to critical stakeholders without ever having to set foot on an active job site, thereby lowering personal safety risks.
While these technological offerings highlight the many uses of proptech across several sectors of the real estate industry, this is by no means an exhaustive list. As technology continues to evolve, so too will its applications, creating new opportunities for adopters of such technology.
The industry is only at the beginning of how proptech can be leveraged to create greater efficiencies and deliver better cost-effective solutions. In short, early adopters who leverage such technological solutions are better positioned to remain competitive and garner more significant market share.