For years it looked like the real estate market was one corner of the economy that could withstand the never-ending march of technology. Sure, websites with home listings have come and gone, but the overall the process of buying or leasing real estate has stayed the same.
It didn’t matter if you are leasing prime real estate in Manhattan or looking to purchase 2,000 acres of land, the way we approached a real estate transaction had remained largely unchanged. That was then, and as we move forward technology is beginning to transform everything related to real estate. With that in mind, here is a closer look at the impact of the tech revolution on the property market.
This one might not come to mind right away but the truth is that tech developments outside the real estate industry have a big impact on property values. A perfect example of this is what has been happening to prices in tech hubs such as San Francisco and Boston as the influx of tech workers and companies have to lead to a massive run-up in valuations.
Beyond the increase in property values, there are also the expectations of buyers connected to the tech industry. For starters, they demand high-speed, ubiquitous internet and this means having T1 connections, strong Wi-Fi networks, and even a high saturation of cell phone towers and other infrastructure.
In addition to the need to be constantly connected, these buyers are also very demanding when it comes to the amenities they expect. While this is no different from other yuppie communities over the ages, the challenge for developers is the need to constantly reinvent their offerings to match what each generation is looking for. As such, the people who make the tech we use everyday are causing a revolution in the real estate market.
Another way this can be seen, especially in urban environments, is the blurring between workspaces and living spaces. Companies such as WeWork have been leading the charge via their unique offerings around the globe.
But they are not the only players in this space and what is really exciting is not so much what is on offer but rather how they are managing these properties. Increasingly bookings, verifications, and payments are taking place online and this is altering how rental properties are managed.
Granted many processes from applications to payments have been online for a while but what has changed is the end-to-end approach to property management. This even extends to how owners manage the various service providers they rely on to keep their properties in tip-top shape.
What does this mean? Well, the lines are blurring. It doesn’t matter if it is between where one lives and works or how a property is managed the key is how the lines are becoming blurred in a seamless world.
Let’s face it, house hunting is a chore. You need to drive around town for days on end checking out several houses. Even with websites, the views are not perfect, and many agents have been known to use techniques to dress up what a house looks like.
But this is changing as several companies have already launched virtual home tours. Some of these are based on virtual reality from 3D photography, while other use panoramic photos to create a sense of what the home is really like. Either way, this approach to viewing homes virtually is allowing would-be homebuyers to hunt for their dream homes from anywhere in the world.
Big Data & Analytics
When you think about it, a lot of the real estate industry revolves around numbers. There are rent payments, mortgage payments, the size of a plot of land, and the GPS coordinates of the same plot. The list goes on and on.
Given this reliance on numbers, it is somewhat surprising that big data hasn’t made a bigger splash in the industry, but that is changing. Increasingly developers and property managers are relying on analytics to help identify trends, such as pricing or what amenities buyers want in new properties. In doing so, they are also making it easier for a new generation, one which has grown up in the world of e-commerce, to shop for a home.
Construction Gets Technical
While the principles behind architecture and engineering are rather complicated, the reality is that much of the construction industry hasn’t needed to adjust to new technologies. However, the advances of 3D printing and the Internet of Things (IoT) are making it harder for contractors to resist adopting technology – or at least understanding it.
What is the impact of these advances? While we might not see Jetson’s style properties in the sky any time soon, there is no denying that all aspects of the property market are finally embracing technology.