When you think of real estate, technology may not be the number one correlation you associate with the industry. However, technology is a major driver of innovation within our industry and can significantly impact both buyers and sellers. Whether you’re interested in up-and-coming technology simply for curiosity’s sake or want to stay apprised of how emerging tech may impact business, I share some insight here:
Virtual Reality and Augmented Reality
Virtual reality (VR) and augmented reality (AR) aren’t new–but they’re increasingly becoming applicable to the real estate market. The pandemic was the catalyst for further developing these technologies, and we’re seeing some truly impressive use of VR and AR in the world of real estate. If you’ve been home shopping within the last five years or so, you’ve probably seen 3D tours. This technology has had an undeniably positive impact for sellers–most homes close 31% faster when there’s a 3D tour available. VR and AR could take it up a notch and offer even more realistic walkthroughs and design concepts.
Analytics Enhanced by AI
Artificial intelligence (AI) has begun to touch a plethora of industries, and it’s coming to real estate as well. Powered by AI, more accurate and quickly-generated analytics are on the horizon. Quantum computing AI is expected to grow quickly between now and 2026–experts anticipate its market size to hit $1,765 million by 2026 (up from $470 million in 2021). With AI-generated data, the implications for investors could be huge. More precise and quickly generated analytics may lead to faster, less risky deals, and it won’t be surprising if more PropTech startups specialize in this niche.
Opportunities For Fractional Ownership
Fractional ownership isn’t new–after all, partnerships such as REITs have been around for decades. However, traditional partnerships require significant amounts of capital (usually a minimum of $25,000) to invest. One way that new platforms can make real estate investing more accessible is by making it possible to get started with much smaller capital requirements. In the coming years, look for PropTech companies to offer the ability to invest in small portions of real estate.
Recent years have been momentous for technology. With the rise of tech like AI, VR, and AR, the possibilities for real estate are just getting started. While there are pros and cons to most emerging technology trends, I’m interested to see how things may change in the coming years.