How Technology is Impacting The Real Estate Industry
Understanding the impact that technology is having on the real estate industry is crucial in determining your real estate strategy.
Technology has become a huge, if not completely necessary, part of our daily lives. Technology is taking over jobs that once relied on human beings, providing substantial advancements and benefits to those industries impacted, real estate being affected more recently.
Traditionally, real estate could only be shown, bought, and sold with the help of a physical meeting between agents, brokers, buyers, investors, etc. However, today it is apparent that whether or not a buyer or an investor leans more traditionally, most of them begin the process by searching for properties online.
There are many technological tools that are changing the world of real estate. Understanding the impact that technology is having on the real estate industry as a whole is crucial in determining your real estate strategy and considering what it means for your role as a buyer, investor, agent, broker, developer, or lender.
Virtual Reality
Videos and images may not always give an accurate representation of a property, especially if they’re poor quality. Virtual reality provides a highly realistic and detailed experience, almost as if you were seeing it in person. This can be very beneficial for investors wanting to expand their portfolios into different markets around the world. It allows for buyers to make a more informed, confident decision without the hassle of traveling to see the property in person. Virtual reality tours can be conveniently viewed through a smartphone, putting properties literally in the hands of multiple potential buyers at once. This is a huge time saver for not only the buyer, but for the owners, agents, and brokers.
Smart Home Technology
Technology is changing the way people live and interact in their homes. With smart home technology people are able to control their home's features through mobile applications and digital devices. Smart home technology is simplifying real estate for not only the homeowner, but also for the agent and tenants. Homes are able to be locked and unlocked without the owner ever having to step foot onto the property. Alarms and security cameras can be turned on and off by a click of a button on a mobile device.
In today’s market, smart homes are selling for more than tech-deficient homes. In a study by Coldwell Banker Real Estate that surveyed 1250 people, 54% of participants said that if given the choice between two identical homes, they would purchase the smart home over the tech-deficient home. This is an important advancement and benefit for investors involved in fix and flips, as adding in smart home features does not come at a very high cost.
Data and Analytics
Big data, search engine analytics, artificial intelligence and machine learning are transformational technologies for real estate professionals. Each of these tools provide highly detailed insights for developers, brokers and investors. Industry professionals can now access immense amounts of market data in order to make smarter business decisions. Less risk often means a greater chance for expected returns. Big data is able to provide more accurate predictions on future trends so that investors can determine their real estate strategies well in advance.
While the technological advancements within real estate are widely seen as beneficial, some people find it to be highly a personal experience and feel that removal of human beings from the equation is risky and concerning. Although technology is constantly advancing and ultimately essential in real estate transactions today, it is very unlikely that technology will completely erase the human element from the real estate industry. The customization and personal aspects of real estate are something that only humans can offer. The most beneficial thing you can do as a real estate professional today is embrace the developing technology and utilize all of its tools to your advantage.
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