The real estate industry’s development is crucial for society’s well-being, as creating property value, whether from commercial or residential buildings, maintains fair selling prices for buyers and sellers. Unfortunately, the sector has been heavily challenged by global conflicts and social issues lately. Still, real estate is typically affected by inadequate financing, complicated regulatory frameworks, and significant construction costs.
However, despite numerous problems, real estate is always open to innovations. Real estate investment trusts (REITs) or mortgage-backed securities (MBS) were massive advancements in the industry at the end of the 21st century. But now, more advanced technologies are introduced, such as blockchain, where everything can be tokenized and invested by leveraging the Ethereum price chart for the best value.
2024 is the year of worldwide evolution, and real estate will be among the sectors receiving new technological support for superior products and services. Let’s dive into some of them.
The emergence of PropTech
PropTech (Property Technology) involves technological support in research for buying and selling a property. However, it may also address property management by taking advantage of analytics, digital dashboards, and 3D modeling to gather essential data. However, it involves the use of extended technologies.
The PropTech sector is promising as it merges finance, sales, construction and sustainability in an industry where technology is slowly expanding. One of the leading factors that make PropTech profitable and suitable for the future involves the increase of co-working spaces and the altered idea of how a workplace should look as a consequence of the hybrid and remote styles. At the same time, technologies like blockchain, machine learning, and AI have proved reliable in managing, sorting, and securing data, which is essential to keeping customers’ information safe and using it to their advantage.
The use of digital twins
Digital twins are an extension of Proptech, as they involve having a virtual replica of physical objects, in this case, real estate. It’s a 3D virtual representation of an infrastructure built through sensors and cameras that transmit data used to mimic real-world features.
Digital twins provide numerous benefits in real estate, such as enhancing sustainability through monitoring resources. At the same time, they ensure a more straightforward decision-making process by offering a clear vision of the property or the plan so costs are not wasted. Digital twins also help mitigate risks by actively evaluating properties regarding safety hazards. This remote feature makes it easy for owners and buyers to communicate and share information efficiently.
The actualization of marketing automation
Various industries have widely approached marketing automation as it generates leads, provides dynamic personalization, and improves productivity levels. It can be used for activity-based email workflows, manage transactions and ensure follow-ups.
Currently, automation in real estate is leveraged through chatbots and virtual assistants that guide customers through the buying or selling process. Hence, this automation tool increases engagement by offering 24/7 availability and accurate responses to elementary questions. Hence, real estate agents can take advantage of automation and shift their focus towards improving their services. On the other hand, marketing automation can manage client data, share information files and track sales, contributing to positive customer experience.
The appearance of the Internet of Things
Internet of Things (IoT) delivers significant improvements in industries like manufacturing and transportation since they require enhanced data monitoring and seamless communication. Recently, IoT has been increasingly used in agriculture, infrastructure, and automation, but it has the potential to change real estate, too.
Integrating IoT in this sector can improve several aspects of a property. For example, using IoT sensors to measure and collect data on indoor and outdoor temperatures can improve the HVAC system. IoT can also provide information valuable for preventive maintenance by monitoring a building’s equipment or tracking technological failures. Lastly, IoT has the capacity to measure space utilization through desk, ceiling and locker sensors to identify the space that has no use and help improve it to save money and resources.
What challenges should be addressed in real estate?
Real estate is a complex industry and has struggled to keep up with the latest technologies as a consequence of global uncertainties, an element that might yet affect the sector. However, with proper digitalization, real estate can evolve so as not to rely on external features and improve on its own through market analysis.
Mitigating the legal framework is also a problem because it involves never-ending bureaucracy while the industry rapidly changes due to different trends. Whether we talk about environmental regulations or zoning restrictions, these rules must be assessed correctly to avoid further complications.
Moreover, managing costs can be the most daunting, especially when the costs of construction materials boomed after the pandemic and the scarce workforce hinders a smooth workflow. Estate projects require thorough budgeting and planning to analyze the supposed expenses, and estimating closely can be difficult without errors slipping by.
The expenses involved in property development include numerous other sections, from land acquisitions to permits and sales, which must be handled. Besides estimating these costs, one should find ways to save money and seek competitive prices.
By far, the biggest challenge is maintaining good relationships with stakeholders during the development process, as communication might be scarce or unfitting. Although this is the advisor’s responsibility to maintain these collaborations, sometimes joining forces with the wrong partner can be more detrimental than poor communication. Therefore, each real estate advisor must pay attention to what manufacturing company or supplier they work with because their relationships can affect or improve the final product’s quality. Engaging with local communities and businesses is also best to help the economy flourish and mitigate obstacles.
Bottom Line
The real estate industry is one of the most important yet challenged by improper regulations and external factors triggered by global issues. Although it’s expected to grow considerably in the future, it must evolve to withstand the market demand and offer reliable services and products to customers. Hence, with the help of technological advancements, real estate can set the base for a better future.
