The real estate industry is constantly evolving with new technologies that aim to make the process of buying, selling, and managing property easier and more efficient. As we head into 2024, here are some of the top real estate tech trends to keep an eye on:
1. Digital Closings
Remote and digital closings became popular during the pandemic as a way to minimize in-person contact. This trend is likely to continue as more tools and technologies enable remote notarization and the digital transfer of documents. Expect more streamlined digital closing processes involving e-signatures, video conferencing, and online document sharing. This provides convenience for buyers and sellers while reducing paperwork.
2. AI for Valuation and Underwriting
Artificial intelligence is playing a greater role in real estate valuation and underwriting. AI can analyze a property's characteristics, market data, and comparable sales to provide more accurate price evaluations and risk assessments. This technology expedites the underwriting process for lenders and provides buyers and sellers with better data to inform negotiations. As AI gets more sophisticated, expect it to become a staple for valuations.
3. Smart Home Tech
Smart home technology encompasses a range of internet-connected devices that allow homeowners to monitor, control, and automate various functions in their home remotely. From smart thermostats and lights to home security systems and smart appliances, these technologies are becoming mainstream. Real estate agents are increasingly marketing smart home features to attract tech-savvy buyers. And builders are integrating smart home technology into new construction from the outset.
4. AR/VR Home Tours
Due to the pandemic, virtual home tours using augmented and virtual reality have exploded in popularity. AR and VR provide immersive experiences that give buyers a strong sense of properties without visiting them in person. As technology improves and becomes more accessible, expect virtual tours to become the norm, allowing buyers to easily view multiple listings from anywhere at their convenience.
5. Blockchain for Transactions
Blockchain, the technology behind cryptocurrencies, has the potential to greatly simplify real estate transactions. By serving as a secure, decentralized digital ledger that stores transaction records, blockchain can eliminate third-party intermediaries and streamline the title transfer process. Some countries have already adopted blockchain-based systems for real estate transactions. Though adoption in the US may take time, blockchain could eventually transform how real estate deals are facilitated.
6. 5G for Real-Time Data
5G's super-fast connectivity speeds unlock new capabilities for real estate tech. From high-quality video tours to AR/VR open house walkthroughs, 5G will enable more seamless real-time experiences. As 5G coverage spreads, it can power data-intensive real estate applications related to AI analysis, smart home control, and real-time market tracking. The adoption of 5G will be a key enabler of innovation.
7. Big Data and Predictive Analytics
Huge amounts of data are being collected across real estate listings, transactions, mortgages, and property records. Big data aggregated from myriad sources can provide deep market insights using predictive analytics. Tech-forward brokerages and marketplaces are tapping into big data to identify opportunities, forecast trends, and gain competitive advantages when advising clients. Data-driven decision-making will only become more crucial.
8. iBuying Expansion
iBuying, the tech-based approach of companies buying homes directly from sellers, surged during the pandemic. Zillow, Opendoor, and Redfin now make instant offers for homes based on algorithmic pricing models. While still a small fraction of the market, iBuying provides sellers with certainty and speed. As the model matures, expect more mainstream adoption from both buyers and investors seeking convenience.
9. Automated Appraisals
Traditional appraisals require in-person visits by licensed professionals. Automated valuation models use AI to estimate property values faster based on data like recent comps. While automated appraisals aren't yet industry standards, they can supplement traditional methods by providing preliminary valuations. As automated models improve, they have the potential to disrupt traditional appraisals and enable faster transactions.
10. Home Operations Technology
A growing category of proptech startups provides technology to support home construction, renovations, maintenance, and management. Apps allow homeowners to coordinate contractors, architects, and other services from their smartphones. Technology also enables remote monitoring of properties. Expect more innovation in the space as technology improves oversight and efficiency for owners, buyers, builders, and property managers.
The real estate industry's digital transformation is accelerating, with technology tackling every facet of the property ecosystem. While regulations will determine the speed of adoption, these proptech innovations promise to provide convenience, speed, and transparency for real estate transactions in the years ahead. As we move deeper into the 2020s, the role of technology in real estate will only grow more integral across the board.