The property management software market is projected to grow at a CAGR of 13.1% during the forecast period. The global market is forecast to generate revenues of US$ 4.38 Billion in 2023 and is expected to surpass US$ 15 Billion in 2033.
The real estate industry is gradually moving to the digital plane – more and more services are provided online. At the same time, as this market develops, it becomes increasingly difficult for companies that have decided to carry out digital transformation to ensure and maintain their competitiveness. The key to achieving these goals is the implementation of at least one of the leading software development trends in real estate. We will discuss the most relevant five of them below.
What Are the Hottest Real Estate Technology Trends in 2023?
There are several factors influencing changes in the real estate industry. First of all, this is a growing trend on PropTech. The term is used to refer to all IT projects related to the real estate industry. As a rule, these are platforms and services for managing commercial and residential facilities, which are based on the implementation of AI, AR, VR, and other technologies that are popular nowadays. They are created not by real estate agencies but by developers.
The second important factor is the new needs of retailers as consumers. Legislative initiatives and modern requirements for security measures form a request for the provision of services with minimal contact between people. As a result, today, the real estate market is developing largely due to technological trends.
So, what is the future of real estate technology? Below we propose to consider five main technological trends that you can implement in your solution for the real estate sector and thus ensure increased demand among your target audience.
An independent web resource Trend Sherpas claims that the utilization of virtual tours for marketing listings experienced significant adoption among real estate agents and brokers in 2020, with a notable 74% of professionals employing this technology.
Indeed, technologies that make it possible to demonstrate real estate objects without the need for a physical presence on-site have long been used by developers and real estate agencies. For example, 3D technologies and, specifically, virtual reality, have been introduced for these purposes for many years.
Actually, real estate virtual reality is one of the most effective tools to help close deals. Nowadays, more and more people tend to sign contracts for the purchase or rental of housing only after a virtual acquaintance with the layout and interior in a 3D tour.
This approach allows all the parties to save time and, instead of scheduling a meeting at the facility, with the help of 3D tours, real estate companies can transfer most of their business tasks to the online plane. By the way, this approach has been practiced by the elite real estate agency Sotheby's Realty for several years now.
Artificial Intelligence (AI) in the real estate market is expected to reach $1335.89 billion by 2029, at a CAGR of 35% during the forecast period.
For example, neural networks (the main direction of the implementation of AI) can benefit a wide variety of participants in the real estate market. With their help, developers, management companies, and real estate agencies speed up solving their regular business tasks: form databases, conduct marketing surveys, perform competitive and statistical analysis, assess demand and sales rates, and automate work in call centers.
Homeowners can also use neural networks – for example, to find out the market value of an apartment before selling it. Indeed, smart real estate search technologies have greatly simplified and accelerated the processes of buying, selling, and renting. Today, such services are available on all popular real estate aggregators (like Realiste).
Also, artificial intelligence is actively used in the US real estate market to assess the value of real estate. Many large companies conduct transactions at prices that AI calculates and predicts. Experts believe that in ten years, about 10% of households will sell through AI-powered marketplaces.
As for the more advanced area of AI – quantum computing, so far, it remains at the development stage and is implemented only in some startups for the real estate sector. In particular, they can be used to identify optimal investment strategies, analyze market trends, and choose properties that are likely to appreciate in value.
Streamlining Of All Processes
On the example of the well-known real estate marketplace Zillow, which has existed since 2006 and generated $1.96 billion in revenue in 2022, we can say that the digitization of tasks related to the sale and rental of real estate is a good idea.
As for optimization of work processes (which can be done through their automation and digitalization), it is important in any sector, not only in real estate alone. This can be achieved by transferring tasks previously performed offline or only partially online to the digital plane. Streamlining also implies the synchronization of data from disparate sources (including external ones that are not the intellectual property of a particular business).
One of the fresh tendencies in property technology is the deployment of Building Management Systems (BMS). These digital solutions empower real estate enterprises to oversee and regulate the physical aspects of a building, encompassing elements such as temperature, humidity, illumination intensity, air conditioning, security apparatus, among others.
What's more, many software development companies are looking to automate many of the tasks that real estate agents find time-consuming, using new real estate technology to revolutionize the way we buy and rent properties. Such effective collaborations give the world successful digital products.
If we talk about real examples, one of the leading roles in process optimization is played by artificial intelligence and machine learning. However, all these benefits can also be achieved without these technologies. For instance, returning to the aforementioned Sotheby's auction, which previously existed only in an offline format, today, this company is not much different in its web advancement from its more “fresh” competitors.
Fractional ownership is not an innovation in real estate – its global market is anticipated to grow $5 billion by 2024. However, the transfer of tasks associated with it to the digital plane is still extremely relevant today and may be considered one of the leading real estate technology trends.
While many investors use forms of partnership such as syndication and REITs to facilitate the purchase and ownership of real estate shares, fractional ownership options are not limited to this. Moreover, digital technologies can play a leading role in expanding the list of available methods to achieve it.
A particular example of the implementation of fractional ownership schemes is the Luxury Shares crowdfunding platform, which allows users to become investors by purchasing shares of luxury housing in the United States.
Let’s finish our list of emerging trends in real estate 2023 with metaverses. The global ‘metaverse in the real estate’ market is valued at $1139.55 million in 2022 and is projected to reach a value of $15698.24 million by 2030.
The concepts of the metaverse and digital real estate are inextricably connected. Compared to non-fungible tokens (NFTs), which have mostly aesthetic value, real estate in the metaverse is an easier-to-understand idea with clear goals.
Although blockchain-based real estate exists only in the virtual world, it provides the same ownership rights to a piece of (digital) land. The acquisition of real estate in the game, community, or other platforms is carried out through the purchase of NFT.
Because NFTs are non-fungible (i.e., each token is unique) and can prove ownership, they act like deeds to land ownership. NFTs can be bought and sold at market prices, which are determined by a number of factors.
A piece of land can be located in a popular or densely-populated area of the metaverse, and, therefore, suitable for advertising. The value of land is also increased by staking incentives and other bonuses. In addition, the price is affected by the features of the specific metaverse platform.
At the same time, you must understand that metaverses are not yet widespread, and thus, you have to invest in the development of such projects wisely.
Modern digital technological trends have become a logical continuation of many years of internal automation processes. As for market participants with already implemented IT solutions, every year, they become more and more difficult.
Modern trends in the field of commercial real estate allow market players to both reduce costs and make the process of interaction between the parties transparent and, if possible, with minimal offline interaction. In the next few years, the challenges facing real estate companies today will not lose their relevance. Technological trends that have formed in recent years will also continue. Therefore, in this direction, the real estate sector will only develop and not stagnate.