How Technology is Transforming the Real Estate Landscape

Market conditions and changing consumer behavior often bring poignant change in a given industry over time. That's what has happened in the real estate industry in the last decade. Real estate companies are focusing more on digital innovations in their business models. More and more companies are building real estate websites, apps, and platforms. For agents and brokers, using technology is necessary to collect, assess and report on listings and consumer behavior. On the flip-side, that same technology can often impact their businesses negatively. Furthermore, a whole range of digital platforms are springing up to make the "for sale by owner" option easier.

Today, digital innovation is redefining what it means to buy or sell a home and exciting digital trends are emerging in this new digital landscape. How will they impact the real estate industry for good or bad? Here is a list of a few factors to illustrate how technology is transforming the real estate industry right now:

1. Transparency

As more data companies provide real estate information to the public through digital mediums such as websites, blogs, and cloud applications, people will become more aware of real-time data as compared to that of past decades when only newspapers and word of mouth were the communication mediums. These easily accessible platforms will provide transparency in the real estate industry like never before with regards to property availability, pricing, data curation and whether a property is for sale by owner or agent represented.

2. Quicker Transactions

Remember the time when it used to take months to close a deal? Today, digital platforms are making it easier to sell and buy properties. Sometimes in a matter of days and that time will continue to get smaller. Even if you're a newbie to real estate, you can get information online and work it out quickly. You can no longer say you don't know how to sell your house fast. Using search engines and advanced data tools available in real estate mobile apps, you can now instantly access information related to a property such as price, property details, comparable properties and even whether or not you can afford a particular home. Don't forget that just a few years ago none of this data was easily accessible. In fact, consumers now tell their agents about houses they want to see.

3. Efficient Marketing

Marketing is one of the most significant technology-enabled updates to the real estate industry. You'll find many websites such as Zillow, Redfin, and Trulia that help you broadcast your message with tremendous visibility. There is more opportunity than ever to get your home in front of potential buyers by using free tools and social media.

4. Accurate and Updated Data

For the last 20 years or so, regular homebuyers and sellers did not have access to real-time data, even if it's your property. You haven't had the power to do with that information what you'd like. It has been held up in systems that can only be accessed by a select few. However, with new digital platforms emerging in the real estate industry, you're getting immediate and accurate data along with expert analysis and critical trending points. Access to data and freedom to decide how you use that data is probably the single most empowering change that new technology is providing.

The Future of Digital Real Estate

Let's discuss how things are going to look in the real estate industry in the upcoming years. Here are a few transformations you should watch out for:

1. Chatbots, Voice Enablement, and Artifical Intelligence

Maybe you've heard about the efficiency of chatbots recently. Some of the peoples' favorite products such as Apple's Siri and Amazon's Echo use voice-controlled chatting architectures to engage with customers, and this is the case for many other industries. Companies use chatbots for efficient customer service, and though you may not have noticed, you've most likely already dealt with chatbots when you're shopping online or browsing a website. These technologies and the devices they power will revolutionize the real estate industry by improving lead generation and providing powerful customer services without large service teams or growing overhead. Chatbots, voice, and AI will play a significant role in engaging home buyers and sellers and bring significant value to companies focused on redefining the current real estate ecosystem.

2. Augmented Reality and Virtual Reality

In just the last few years, we've seen new technologies like low cost, high-quality drone footage and online home tours take off. But this is nothing compared to what AR and VR will bring to the industry. Imagine sitting at home and taking a guided tour of a house in 3 dimensions with a simple VR headset and your smartphone. Or use your smartphone to see how your desired furniture will fill an empty house. Inspectors, appraisers, insurance carriers and many other stakeholders will use these technologies to streamline every process in the transaction making it easy for home buyers and sellers to work directly with each other.

3. Blockchain

In September 2016, Cook County Illinois Recorder of Deeds announced that they would take part in a pilot program, along with California based Velox RE, to study how they could use blockchain technology for Illinois land records. Their focus was to uncover opportunities and potential roadblocks in using blockchain technologies. Their goal; to simplify and secure property transfers on a distributed ledger. Their findings are here. This pilot program is only one indication that not only are private companies getting involved but local, state and federal governments as well.

The term "blockchain" is often used synonymously with "Bitcoin," the cryptocurrency that has brought blockchain technology into the limelight but blockchain technology is much broader than the Bitcoin use case. It will play a significant role in the future of real estate.

In a 2016 report released by Goldman Sachs, "Blockchain: Putting Theory into Practice," title insurance is likely the only type of insurance where the cost of the insurance is not directly tied to actuarial risk but based on the labor and effort of the title company employees. In short, inefficiency is driving the cost of title insurance. There is nothing more ripe for disruption than inefficiency-driven cost.

Though implementing blockchain technologies will take time and the collaboration of many groups including local and state governments, the potential for securing title and property transfers while reducing inefficiency and cost is unprecedented.

The past 5-7 years have seen significant shifts in real estate due to technological advancement, but it's just getting started, and we plan to play a leading role in the change.

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