The latest technological developments continue to improve productivity and the quality of our lives. Even though it may seem a little strange, real estate investing is among the industries benefiting from some of the newest innovations. My name is Ofir Eyal Bar, a real estate investor with experience in Europe and South Africa real estate markets, and I would like to talk about five of the top new technologies that can or are already having a major influence on the real estate industry.
Known as a field that treats ways to analyze and systematically extract information from data sets that are too large or complex, big data is one of the technologies that can find a useful application in the real estate industry. Both real estate agents and homebuying platforms can make better recommendations to their customers, under the right circumstances.
Since they want to personalize their clients’ recommended properties based on personal wants, big data can assist in the process. Unfortunately, it’s being used heavily in marketing and advertising at the present time, but the trend seems to be pointing towards a greater big data integration into the real estate business.
We should expect to see major improvements in the functionality of real estate platforms designed for both buyers and sellers. In order to make the process easier and more intuitive for a larger number of people, platforms will provide a better experience and homebuyers will be able to find what they’re looking for quicker. An optimized real estate platform can improve the market activity and most importantly, it will enable ordinary people to buy a property without having to deal with a real estate agent. Any potential commission for the agent will get out of the equation, meaning lower prices.
Although the blockchain technology had gotten popular because of its use in cryptocurrencies, in reality, it can have endless applications, even in real estate. Tokenization can facilitate landlords to sell portions of ownership in their properties. At the same time, smart contracts, another important technological breakthrough enabled by the blockchain, can intermediate transactions between buyers and sellers.
A financial transaction can take place in a completely encrypted environment with built-in legitimacy checks, allowing both parties involved to save travel-related expenses. Using smart contracts, two people located on opposite sides of the world can make a real estate transaction, without having to worry about security or reliability.
Calculating ROI (Return on Investment) or other real estate expenses is a repetitive task that could seem boring at some point. Thankfully, machine learning can assist real estate investors in the process. Using algorithms, they can gain more knowledge about the ROI for each of the transaction made. Also, such a software can be able to make more accurate predictions for what properties should be sold, how much they’ll be able to make at any given time based on the market price.
Real estate investors can use machine learning in order to spot better real estate deals since technology can assist in making better decisions. As long as the process can be split into a series of variables, a mathematical formula can be designed, so the software will do a big portion of the hard work, saving time and money for investors.
In order to buy a property, the buyers must inspect it inside and out, a challenging task for real estate investors wanting to invest abroad. Travel expenses generally reduce profitability by a high margin, making overseas investments for the average investor less suitable. Things could change if virtual reality can find proper integration in the process.
By creating virtual walkthroughs, one could make a VR presentation for a property, allowing more investors to see it, no matter their geographical location. Virtual walkthroughs can be accessed via any modern browser, contributing to an improvement in exposure on a global scale. At the present time, there are only a few virtual walkthroughs for real estate properties, but the trend should accelerate in 2020 and in the next few years, given all the benefits it could bring.
These are just 5 of the top technologies that can have a major impact on real estate. What is easily noticeable is that the industry does not know to leverage to the max the true potential of technology and that’s not too good. However, the future prospects are better and with a broader integration of technology, investors, agents, and people interested to buy a property, will have access to better services and better prices.