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Modern technologies are becoming increasingly prevalent in the real estate market trend due to the fast-paced technological revolution and digital transformation. This shift towards digitalization is driven by both economic efficiency and changing customer preferences.
What can we anticipate in terms of real estate technology trends for 2024?
What does the future hold for the real estate industry?
Which technologies will aid in its growth?
Explore the article to find out more.
According to a recent survey, a significant majority, around 91%, of respondents express concerns about inflation, interest rate fluctuations (89%), and economic growth (88%). Moreover, there’s a notable apprehension regarding political uncertainty at global, regional, and national levels, with 79%, 68%, and 54% of respondents highlighting this concern respectively.
In recent years, there’s been a noticeable evolution in the concept of real estate. It’s expanded beyond traditional categories like office spaces, retail, and industrial properties, offering diverse investment opportunities.
Leaders in the real estate market agree that technological advancements and changing consumer behaviors have blurred the lines between conventional industry sectors:
“We’re entering a phase where users aren’t tied to specific asset classes. They can utilize spaces like retail, offices, or industrial and logistics as they see fit,” explains a venture capitalist.
However, achieving this requires collaboration between real estate industry stakeholders and IT professionals. Through such cooperation, the sector can continue to grow steadily despite market and economic uncertainties.
PropTech, short for “property technology,” combines real estate with cutting-edge technologies such as the Internet of Things (IoT), artificial intelligence (AI), mobile solutions, and cloud computing. Its goal is to provide the real estate industry with more efficient, effective, and innovative solutions, transforming how properties are bought, sold, rented, and managed.
Innovative PropTech solutions encompass virtual property tours, automated business processes, data-driven property management systems, security systems, smart lighting, and temperature control in smart homes. By leveraging PropTech, real estate companies can enhance efficiency, reduce costs, and elevate service quality, fostering a more competitive market.
PropTech is rapidly growing and holds immense potential to reshape the real estate landscape, benefiting both consumers and businesses. What real estate technology trends will gain momentum in 2024?
Throughout history, real estate has remained a cornerstone of our economies, a fact that holds true even in 2024. The residential real estate segment continues to dominate, with a projected market volume of $498.60 trillion in 2023, expected to grow annually at a rate of 3.52%.
However, to stay competitive in this robust market, companies must invest in tech solutions. The global real estate industry is undergoing a significant digital transformation, with a projected value of $8.6 trillion by 2026. Technology enables smarter decisions and enhances experiences for tenants, landlords, and investors.
Startups are leveraging innovative technologies to introduce new business models aimed at streamlining real estate transactions. These include open platforms for innovative investment models, curated platforms for specialized services, brokerage models employing machine learning, and operator/management companies offering long-term leasing solutions.
The global real estate software market, valued at approximately USD 10.24 billion in 2023, is projected to grow at a CAGR of 12.8% from 2023 to 2030. This expansion is driven by increased digitization, which facilitates predicting purchasing behavior and customer trends, along with the adoption of technologies like cloud computing and artificial intelligence.
In 2022, the customer relationship management software segment held the largest market share of 27.20%, while cloud-based software accounted for a significant 52.37% market share due to its efficiency and security standards.
Smart technologies have become standard in today’s real estate market. They enhance the value of properties by offering increased comfort and efficiency, attracting new customers in the process. Properties equipped with smart features automate tasks, providing users with greater convenience and security. Smart homes integrate various devices like cameras, sensors, and Wi-Fi-enabled bulbs, managed through applications. These technologies improve security, reduce energy consumption, and offer customizable solutions for both residential and commercial properties.
The integration of PropTech in designing sustainable properties is a crucial trend for 2024. Technologies like intelligent building management systems and Building Information Modeling (BIM) contribute to optimizing energy usage, water consumption, and waste management. Smart building technologies monitor environmental parameters and analyze data to reduce greenhouse gas emissions and operating costs. BIM facilitates efficient building lifecycle management, from design to demolition, ensuring sustainability principles are met.
AR and VR technologies are gaining traction in the real estate market, offering immersive property experiences to potential buyers. These technologies allow customers to visualize properties remotely, reducing sales time and enhancing decision-making. AR overlays virtual objects onto real environments, while VR provides virtual property tours, enabling buyers to explore properties without physical visits. The use of AR and VR is expected to become standard practice in real estate by 2024.
Blockchain technology is revolutionizing real estate transactions by increasing security, transparency, and efficiency. Smart contracts stored on the blockchain streamline transactions by eliminating intermediaries and physical paperwork. This reduces costs and minimizes the risk of fraud, making real estate transactions faster and more accessible. Tokenization allows fractional ownership of real estate assets, opening up investment opportunities to a wider audience. Expect significant developments in Blockchain technology for real estate in 2024.
Fractional property investment is a growing trend that allows investors to own a portion of real estate assets. This democratizes the real estate market, enabling investors with limited resources to participate. Fractional ownership simplifies property transactions by allowing investors to buy and sell shares of properties, providing flexibility in managing assets. It benefits property owners by facilitating partial sales and appealing to a broader pool of buyers. Fractional ownership also allows investors to diversify their portfolios across different properties and locations.
Artificial Intelligence (AI) is revolutionizing the real estate industry by expediting processes through automation. AI enables quick access to property data, facilitating more accurate price predictions. With AI’s ability to self-train, make judgments, and problem-solve autonomously, real estate professionals become more efficient. Recent advancements in AI research for real estate applications have shown promising results, allowing investors to identify and assess opportunities at unprecedented speeds. The emergence of quantum computing AI is a significant trend expected to gain momentum in 2024. Projections estimate the global quantum computing industry to reach $1,765 million by 2026, marking a substantial increase from $470 million in 2021. Although still in its early stages, the real estate industry is slowly adopting this cutting-edge technology, with vast potential for future PropTech businesses and corporations.
Real estate software development is on the rise in 2024, aiming to streamline processes, enhance efficiency, and improve the effectiveness of real estate agents and managers.
Property Management Software: Interest in developing property management software is growing, allowing comprehensive record-keeping of properties, including technical details, rental history, and documentation access.
CRM Systems for Real Estate Professionals: CRM systems help real estate agents maintain customer databases and manage sales processes, facilitating client assignments and tracking communication histories.
Property Valuation Software: The popularity of property valuation software is increasing, aiding in assessing property values based on various factors such as location, condition, and type.
Virtual Tour Systems: Software for virtual property presentations is in demand, offering virtual tours for properties, beneficial for clients unable to physically visit or wanting to explore assets remotely.
Low-Code Software Development: Real estate software development utilizes both established technologies and low-code solutions to adapt to market trends quickly, ensuring effective sales activities for real estate agents.
Progressive digitalization and transformation are shaping the future of the real estate market. Modern technology benefits all stakeholders involved in real estate transactions, from customers enjoying virtual tours to managers optimizing property control.
However, increased automation may lead to job cuts in areas like real estate brokerage and building management, posing risks to the industry’s reliance on IT systems. Nonetheless, technology offers opportunities to enhance construction processes, sales handling, and property management efficiency.
With AI, VR, AR, Blockchain, and dedicated software gaining importance, staying updated on real estate technology trends is essential for leveraging best practices and achieving significant profits in 2024.