How is Technology Changing Real Estate?

The digital revolution is knocking at the door of the global real estate market. Technologies help businesses to create complete analytics of the market and segments, estimate the construction of facilities, process information, engage consumers more, and provide them with the requested data.

This is just the tip of the iceberg of how digital solutions are changing the real estate business. Below we are considering the market trends, challenges of adoption, and useful technologies in the real estate industry that make a difference.

1. Real estate innovation: Transparent market without lags and pitfalls

Support for smart home systems, online monitoring of sales and purchase agreements, registration via real estate legal services — all these options are demanded by the market. New vectors of development require an updated technological approach. Proptech is a radical new approach to digital acquisition, operation and management of real estate innovation. Growth of the global proptech market over the past few years has shown high performance, and the use of various instruments has become not just a trend, but a direct necessity.

According to the monthly calculations of the Center for Real Estate Technology and Innovation, the amount of venture capital invested in proptech in 2020 was $23.750 billion. The indicator was formed by the financial statements of 425 investing companies. This is 24.7 % lower than in the previous year. Investors decided to fund IT companies and startups — whose solutions help to increase the speed of processing daily operations, reduce the risk of human factor and error, indemnify the closure of transactions, and mitigate financial risks.

The blockchain technology in the sphere of proptech helps to keep and fill registries and property rights correctly, providing simplicity, transparency and security of transactions. For example, the crypto technology is already being used in Sweden — they have created a digital cadastral register.

What prevents us from scaling the real estate business through digitalization? According to the KPMG Global PropTech Survey, blockers could be divided into 4 groups: unclear vision of ROI mark, absence of right staff, lack of appropriate in-house talent and priorities.

Are all startups, proptech trends and innovations risky and financially unpredictable? When we add the uncertainties of the geopolitical future and heightened consumer control, proptech companies become indecisive players. Transformation processes can only be successfully completed if management is focused on the cause of the transformation and has a clear plan for change for all stakeholders.

2. Real estate technology trends and solutions

Let's briefly remember the past, when the pandemic was just beginning. Investors at that time avoided risky trades. Despite the instability factor, the volume of financing (not venture investing) in the proptech sector was only increasing.

Source: CBINSIGHTS Research

For example, in 2019 we saw a sharp increase in funding — by $3,424,000. Successful projects and companies scaled their business and announced an IPO.

Real estate is considered to be one of the investment asset classes that provide an acceptable return at low interest rates. The year 2020 set goals for ensuring security in the real estate sector, leveling risks associated with attracting people to work with big data and automation. Governments around the world have introduced mitigation measures, such as deferred tax payments and insolvency to avoid the worst effects of the pandemic. These reforms require quick adaptation. Only digitalization tools will be able to optimize and upgrade reality to these processes. Let’s consider which proptech solutions are moving the market forward.

Buying and selling websites

Services for the selection of different types of commercial real estate, like offices, warehouses, retail outlets are popular now. Over the past couple of years, it is no longer enough just to place ads on the site, since the overestimated price expectations of real estate owners increase the exposure period of the object on the market. The abundance of sites and resources with inaccurate information complicates the choice of real estate for a person who doesn’t cooperate with realtors and agencies.

Advanced software tools allow to develop a site with virtual walks and options such as the ability to open an escrow account remotely. These options range from the primary options (like filtration by living space, district, infrastructure requirements and maintenance conditions) to marketing tools such as 3D panoramas and presentations of virtual tours.

Real estate CRM software

If we're dealing with manual labor errors, complex handovers, large flows of data and comprehensive lead processing, we will need automation tools.

The CRM system will help in automation. To solve the individual tasks of a company, it’s required to develop software that will have specific functions — which will match the company needs. The implementation of the system provides control over the work of the agency, all contractors and employees. It allows you to track profitable transactions and identify unscrupulous co-workers.

Another important advantage of the program is a detailed story of work. The system stores complete information about past transactions, including the specifics of customer requirements and contacts, agency reporting in visualizing forms, telephony integration.

The main requirements to modern CRM systems are:

• assistance in management
• track interactions
• functions of reminder

Source: Software Advice Analytics

Mobile apps

Launching a mobile app will give you a competitive advantage over potential buyers. The basic functions of apps include registering a user, creating an account with the client’s personal info, participating in loyalty programs, searching and booking of objects, and arranging of meetings and payments.

In addition, the user of the application could have access to the real estate database, and presentations of objects. Innovative applications allow users to control smart home systems remotely, reducing the cost of housing and communal services.

RPA systems

Robotic process automatization (RPA) is the direction of business automation that accelerates the execution of repetitive tasks by manual data entry, processing, and storage.

RPA systems help to reduce direct and indirect costs associated with the maintenance of staff and customer support: salaries, sick leaves, taxes, bonuses, workplace organizations, insurance, pieces of training, marketing expenses, and more.

Of course, it’s still necessary for real estate projects to be handled by those who have expertise in the aforementioned areas. RPA is all about streamlining and accelerating core processes, not killing off skilled professional roles altogether.

For example, if your operations involve company-owned vehicles, understanding car insurance liability limits is important, and cannot be trusted to automation in its entirety. Thus a combination of RPA and human adaptability delivers the best results, while still driving down costs and improving efficiency. It’s a key aspect of ensuring accountability even as automation extends its influence over more areas of real estate.

One example of proptech projects is site filtration with an internal selection of real estate. This operation used to be performed by realtors who searched for houses or apartments on bulletin boards. The robot, in fact, has freed the company's employees from the routine of searching, posting, and sending info to customers. Now RPA with integrated artificial intelligence is looking for the objects the client needs and offers selections with the necessary filtering.

Availability of RPA in business indicates a high potential for technology penetration in the medium term:

• Human factor is reduced — a correctly configured robot performs its tasks without errors that will periodically occur in humans.
• Up to 80 % reduction in direct costs — correct automatization improves the quality of lead processing, so the conversion increases.
• Fast implementation — since RPA doesn’t change the IT landscape, implementation is finished in time. Tangible results can be achieved within the first 2 weeks of piloting.

BPaaS

Business Process-as-a-service (BPaaS) is a service-oriented cloud solution that allows business owners to automatically scale all business processes without worrying about physical resources.

The benefits of the solution include:

• fast automatization
• ability to focus on business core functions and activities
• reduction of costs for ownership

Examples of services in the real estate industry include signing and sharing of electronic documents with clients and intermediaries, user identification, mail management, group and individual surveys.

3. Real estate startups revolutionizing the industry

Top competitive proptech startups stimulate the expansion of digital technologies to the real estate industry — from maintenance and verifying transactions to charging rent payments. Some of them improve the decision-making processes and asset performance, reduce costs and raise revenue. Let’s consider examples of successful real estate tech startups.

Briq: Think profit, just more of it

Website: Briq

The bottom line: the service helps real estate professionals manage their budgets and investments.

The target audience: contractors, project managers, investors, financial analysts and directors.

Location: Santa Barbara.

5-year search growth: 314 %. Search actual data of growth via link.

Ohmyhome: Connecting tenants and clients

Website: Ohmyhome

The bottom line: best tech for real estate agents in the Asian market. Contains listings for houses and apartments, connects tenants with home loans and renovation services.

The target audience: loan agents, tenants, clients looking to rent, single-family rental clients (SFRs).

Location: Singapore.

5-year search growth: 42 %. Search actual data of growth via link.

Kin: Real estate insurance innovation

Website: Kin

The bottom line: tech for insurance of real estate in regions that are prone to natural disasters.

The target audience: insurance companies, real estate appraisers, investors, owners of property in regions with floods, hurricanes or other possible natural disasters.

Location: Chicago.

5-year search growth: 3700 %. Search actual data of growth via link.

4. Our expertise

One of the examples of a successful company that changes the real estate and legal tech markets by software implementation is our client — the Laurus company.

About the client

Service profile: property transfers, family dispute resolution and asset protection. Location: the law firm is based in the United Kingdom and has branches throughout the country. Tasks: simplify and speed up the processing of requests. To optimize the integration of branches in different parts of the country. To provide well-established stable work, the result of which will be an increase in transactions and profits.

What we’ve done

Implemented a digital transformation that includes the integration of the BPM Workflow Engine. This automates operational tasks that were previously performed manually. A platform has been developed with two Ul applications and a common API that optimize the organization and exchange of databases between branches. The first application was created for real estate agents and lawyers who manage the deal — help to draw up documents for the buying or selling real estate and conduct the entire transaction process. The second application was created for clients — for people and organizations who want to buy or sell real estate property.

About the app for clients

A potential client goes through a questionnaire, answers simple questions about his case. Then, the application takes into account the clients’ wishes and terms and calculates how much the transaction will cost him approximately. It takes into account the cost of the property, fees, taxes, law services, and other possible additional costs.

About the app for real estate agents

The application for agents automatically includes all cases generated by potential clients. Thus, agents receive all the case information and can offer clients their assistance in completing the selling-buying deal.

Result

Maintaining a customer base has become easier and faster. The company has reduced the number of manual operations by 5 times. The process of leading customers through the sales funnel has become transparent: conversion, sales and customer loyalty have increased.

We have experience with expertising and solving the technical issues of startups, small businesses, and medium-sized enterprises from the US, UK, Canada and Israel. We are open to consulting, partnership and collaborating with clients around the world.

The global real estate market is challenging, but with a reliable software partner, everything is possible. To adapt business processes to current realities, real estate business needs advanced tools. We have profound expertise in software development and expertise in the real estate domain. For consulting or questions in the sphere of comprehensive solutions in the proptech sphere contact us.