The Main Perspectives for Tech Transformation of the Real Estate Property Management Market

The Main Perspectives for Tech Transformation of the Real Estate Property Management Market

Prop tech, a short to property technology, is a family of digital technologies and economic trends that together gradually transform the real estate market. In particular, thanks to the end-to-end automation, new data processing, and object representation capabilities, the real estate industry is beginning to take a fundamentally different form and embrace new target audiences. Below we will discuss the prospects of such a transformation.

Challenges of the Real Estate Property Market

First, let us review the most common problems companies dealing in real estate face.

  • Level of service quality upon an increasing number of customers. The growth in the number of clients for each company operating in the real estate sphere is not only good news but also a plethora of problems with the quality of services provided. The fact is that often the current staff does not have time to cope with the increasing amount of requests which may lead some customers to leave without closing a deal. Moreover, the competition between companies is growing every day and the inadequate speed of client request processing often means that customers simply choose another company.
  • Company scaling. To solve the previous problem, companies are hiring new employees. What does this mean, practically? First of all, the need to outfit new workplaces, rent office space, as well as pay taxes regularly (even before new employees start making the difference). As a result, this entails a serious gap in the company's budget (as practice shows, the payback period for new employees is a relative concept with salesmen starting to pay for themselves most quickly, the slowest are employees who coordinate the company's internal processes).
  • Presentation of unfinished objects or those that are in the planning stage. When a building is not finalized yet, it is not so easy to find potential investors and buyers. Ordinary 2D models may work but this approach to demonstration is several times less effective than new-fangled applications based on the concept of virtual reality.
  • Power consumption management. Many countries today are directing a remarkable effort at fighting global warming. The key to this is the rational use of energy resources by equipment, including air conditioning systems. If the developer company does not design the future building with energy saving in mind since the start, it will automatically lower its chances to be competitive.
  • Features of building design. Design accuracy is the key to avoiding additional, unforeseen expenses for development companies. Implementing accurate real estate projects with the confidence that the building is constructed exactly as designed and the quality of the project is preserved, using the past architectural techniques, today is almost impossible.
  • Financial statements management. When there are a lot of clients, financial reporting and monitoring become real torture for the accounting department. Even the smallest mistake made in the preparation of reports can cause significant damage to the company, so it is very important to find a tool or methodology that would minimize the risks associated with human factors.
  • Data synchronization. If a real estate company has several departments, exchanging the current information becomes a problem on its own. It is equally difficult to synchronize data between multiple software solutions. This leads to random errors, untimely information updates or even leakage of important data, which in turn results in the loss of money and customers.

Market Trends and Demands

Today prop tech technology is used to facilitate a transition from manual labor-based property management to deep automation. This allows implementing the control processes at a much lower cost, as well as ensuring the sustainability of the most important engineering and technical systems of the building (for example, the heating system - by installing IoT-capable smart thermostats that provide cost savings of up to 28% in some cases). Thus, entrepreneurs working in the real estate market should already take into account the potential of the Internet of Things devices.

Moreover, more and more customers emerge that are well-versed in smart home solutions and are interested in buying objects where a high level of automation is envisaged already at the design stage. So far, in many countries, there are not enough highly qualified specialists able to integrate the Internet of Things solutions due to the multitude of protocols and devices available on the market, so in the coming years, the most advanced proptech companies will focus on finding or nurturing such experts.

Some researchers predict that in the near future each room will have its own microclimate fully controlled by smart prop tech devices. In Western Europe and the United States, companies are already engaged in the implementation of such systems but every year this niche is expected to replenish with new, even more advanced solutions.

And finally, in the future, property technology market may come up with solutions based on the blockchain, for example, smart lease contracts that would allow renting the residential real estate in the most convenient and transparent way, without the participation of any intermediaries.

Technological Trends of the Proptech

Now let us highlight the main real estate technology trends that aid in solving the mentioned challenges and follow the above market trends.

  • 3D modeling. This implies a special method of measuring buildings based on the latest 3D modeling technologies, with which you can quickly and accurately obtain a 3D cloud of points that architects and designers will then use when designing the building. In this way, the project can be developed more accurately, avoiding additional costs and not wasting time on corrections during construction. Interior designers can also use this method when designing since the whole apartment is available in 3D.
  • Smart home systems. The smart home is not only a fashionable technological innovation based on the concept of the Internet of Things but also a solution that can provide its owners with means of cost saving. Already there are tech companies offering heating/cooling control systems, which can regulate the microclimate of an apartment or even certain rooms according to environmental conditions and predefined triggers. Another bright example of modern smart proptech systems is air intake regulators usually installed on or under windows that allow managing the intake of fresh air and level of humidity on-premise in accordance with wall- and ceiling-mounted sensors (these monitor the room temperature, humidity, and CO2 levels). Upon analyzing this data, the system independently decides on opening and closing certain window sashes, air intakes, blinds, and shutters, ensuring an optimal indoor climate. Thus, building and developing environmentally safe buildings through the introduction of innovative solutions based on proptech technology, companies gain recognition and increased competitiveness.

 

 

  • AR/VR applications. Real estate technology based on augmented/virtual reality is also considered one of the mainstream and accessible in the niche. That is why many modern real estate agencies employ it when presenting objects to potential buyers. In particular, the most creative of them specifically appeal to the developers to create special AR/VR apps. As a result, the buildings can be viewed as informatively as possible in comfortable conditions.
  • CRM systems. In order to maximize the effectiveness of interaction between employees of real estate companies and their clients, the former are actively introducing CRM systems into their workflows. In fact, these solutions are nothing new for trade; only the technologies and the number of integrations used in such applications differ. In particular, cloud CRMs are especially valued today, due to simple scaling, ease of access, and instant update of corporate information for remote and mobile employees.
  • Blockchain. As we noted earlier, in the near future the blockchain may become the most important technology for property management, creating new schemes to conclude transactions and preserve private information from malicious changes. Such an approach to the interaction between the parties will help ensure end-to-end transparency and reliability of all financial agreements.

Opportunities to Modernize Real Estate Market

The main opportunity to modernize the modern real estate market at the level of your company is to start cooperating with software developers in order to implement at least one of the technologies described above into your business processes.

Not only will you present your business as progressive and meet the highest expectations of customers but also become able to significantly reduce the operating costs.

Conclusion

Let's sum up. As you may have understood, the IT sphere is already applying a notable effort to radically transform the real estate industry. Therefore, if you want to maintain your competitiveness for many years, you will have to employ at least one of the mentioned trendy property technologies in the next 3-5 years. If you need to create a software solution for your business, contact us at Artelogic, and we will implement your idea as quickly, efficiently and inexpensively as possible!