Real estate isn't typically considered a tech-filled field. Most of the changes faced by this industry have been in financing and demand, with technology being an afterthought of traditional practices. Recently, however, a growing number of technology startups and products have emerged, greatly impacting the industry. This made the industry stronger, and also more open to new business opportunities.
According to CB Insights, real estate technology companies raised $1.37 billion in the second quarter of 2016. That kind of funding indicates that real estate professionals are catching on to how important technology is for the future of their industry. It is also fueling an innovative spirit in the industry, giving realtors, brokers, and investors various options to leverage tech as they evaluate properties.
With this, new markets are opening up in ways that were previously impossible. Bill Lyons, CEO and founder of Revestor, a search engine that guides potential investors to ideal properties, explains:
“Real estate and technology are in a tug-o-war. Consumers are beginning their search online and realtors are scrambling to get in front of them. The key is providing the technology that connects real estate investors with realtors and real estate investors with profitable properties.”
Making Big Data User-Friendly for Real Estate
Technological trends unrelated to real estate professionals are also rapidly changing the industry.
“Peer-to-peer sharing is huge right now. Airbnb has impacted high end markets for real estate investors and as a result investors can now cash flow properties in high priced cities with unprecedented success,” said Lyons.
As brands like AirBnB and VRBO increase the value of short term rental properties, more people are looking to invest, but they need the data to justify the decision. Trying to work with multiple websites and spreadsheets to come up with this data can be hard. That is why more and more real estate professionals are beginning to use technology that aggregates this data.
Virtual Reality Tech
Another form of tech that is deepening the context of real estate sales is virtual reality. Brands like MatterPort and Floored are creating experiences to help potential investors get a 360 degree look at their investment, before ever setting foot on location.
The other great aspect of VR for this industry is that it does not replace current practices, it just enhances them. Mike DelPrete, from Property Portal Watch, explains:
“VR just adds another step to an already efficient process. It will not replace any existing parts of the process.”
Social Media as an Untapped Resource
An unrealized area of potential for real estate professionals is the use of social media for promoting properties, services, and talent. While some realtors have successfully used platforms like Instagram, Facebook, and Twitter, these mediums are still evolving, and therefore bear a great deal of potential for both promotion and increasing reach.
Using Real Estate Technology to Reach New Groups
Early adopters are usually the ones that acquire special access to consumers because they're already familiar with the technology and services. Staying close to millennial investors is important. This group has been hesitant to get involved in real estate but recent surveys are indicating a shift in millennial opinions on investing.
As the most technologically savvy generation, they will help define how technology will improve real estate markets, and those that fail to meet their technological expectations will likely miss out on their business. Big data is making it easier than ever to target these segments, as the National Association of Realtors released the top ten millennial purchase markets based on their research.
“Predictive analytics is becoming one of the most important developments in real estate tech. By helping people access historical data, trends and predictions for the future, we are opening up to a whole new market of potential investors,” Lyons explains.
As big data, mobile technology, and analytics continue to evolve to better serve the industry, it has the potential to modernize and grow despite an otherwise slow growth decade.