You’d be forgiven for thinking most aspects of real estate and its relationship with tech aren’t for the average investor to keep up with. If you really want to stay ahead of the market, though, you’d be wise to familiarize yourself with how current and future technologies are going to change the industry in just a few short years. In fact, you may already be behind how things have changed as digital marketplaces replace parts of our physical reality.
Technology marches on, but real estate falls behind
Historically speaking, real estate is a market that has been slow to adapt to new technologies as readily as other fields. As many as 89 percent of real estate firms experience difficulty in collecting and sorting data for the purpose of making informed business decisions at a time when investors from every walk of life are pouring money into data analytics and its ilk.
Thankfully, the past few years have signaled a push towards widespread tech adoption as the end of October alone saw billions of dollars in investments pouring into companies with an eye on bringing technology and real estate together. When any number of companies fail to take advantage of an EBITDA calculation while trying to push their business forward, it’s surprising yet also refreshing to see such a surge in digital interest.
The macro side of technology
Industry slip-ups aside, it does take a certain amount of care and attention from the planning and labour side of the equation in order for realtors to capitalise. Among the imminent benefits of tech-minded development are the boons of cheaper construction and built-in connectivity to the Internet of Things, a concept that has been slow to advance before the last few decades of internet awareness and integration.
It’s one thing to be able to check webcam feeds from street corners to watch for any warning signs of a poor neighbourhood that could impact sales, yet it’s another story entirely to be able to tap into data networks that collect vehicle and foot traffic statistics along with peak hours of activity and other data points to assist in making more effective investments. As more and more devices enter the IoT network, urban centres as a whole are likely to see major changes in how they are bought and sold as well as how they are built and managed, making them potentially less volatile and even more adaptable.
The trends of yesteryear march on
It would be remiss to look forward without also peeking at recent changes that have made tech in real estate a different market than it was thirty years ago. Smart devices alone have taken a brick and mortar business to an era where houses can be viewed and documents can be signed without a realtor and customer ever meeting in person, should that be how they choose to conduct business.
The availability of data has allowed investors to make better choices and the ease of bringing money together through investors through crowdfunding, along with the tokenization of real estate itself, have expanded the market by billions upon billions of dollars. Trying to pitch an idea as esoteric as buying micro-shares of a property have taken us well beyond the classic view of timeshares and vacation destination properties.
As the market continues to shift and new technologies sculpt how real estate business is approached, it’s important to stay abreast of changes without being completely lost to potential fads. New technologies don’t always pan out, yet those who adapt to promising new avenues are often rewarded. The market may change yet the core of these investments and the ideals of running a business will long outlive small changes and tech hype.