In this fast-changing digital world, it has never been more dangerous for companies to neglect the importance of harnessing new technologies. Of course, the real estate industry is no exception.
All property developers have had to embrace digital technology as it has enabled them to better serve customers and stay ahead of their competitors. This is the best time to revolutionize real estate business models as the Covid-19 pandemic has profoundly changed the ways people live, work and play in a way that could never have been imagined previously.
Most businesses have needed to adapt and innovate to ensure consistency of services during extensive lockdowns and to ensure they serve customers in a way that safeguards health and safety.
With this in mind, this article will provide you with an overview of key digital trends in the real estate industry which have become crucial in order to build resilient business operations, remain competitive, create a digital-first culture and thrive in the long term.
1. Big Data for planning and making a decision
The term ‘Big Data’ has been around for some time, but what does it actually mean? And how does it impact the real estate industry?
Well, let’s think of our habits when we watch Netflix or YouTube, we tend to binge on shows suggested by algorithms that seem to understand our preferences. These algorithms make use of big data and analytics, such tools allow companies to utilize data to better understand customer needs and behaviors, in order to provide them with a more tailored and personalized experience.
In the context of real estate, developers can invest in advanced analytics tools in order to identify potential opportunities such as types of property for development, property investment opportunities, customer profile/buyer insights, market forecasts or price segmentation using a wide range of data sources.
2. Robotic Process Automation (RPA) for task automation
Real estate and property management involves working with many different documents and involves lots of time-consuming processes.
Investing in cloud-based RPA software will help realtors improve efficiency and productivity by eliminating or minimizing tedious labour-intensive tasks which are rule based such as data migration, data extraction, data updating, monthly invoices or other activities that are highly objective and repetitive.
RPA is capable of automating such tasks with speed, to a high quality and without errors. A key candidate for the application of RPA technology is in back-office support functions (e.g. accounting and HR) as tasks in this area often show a relatively high share of repetitive and structured processes which demand lots of manual time and effort from employees.
Through RPA automation, this can help companies recognize both financial and operational efficiencies, freeing up employees to focus on more value-add activities and on delivering a better customer experience which can ultimately lead to better customer outcomes and property investment decisions.
3. VR and AR Technologies for property showings
Virtual Reality (VR) and Augmented Reality (AR) have numerous applications in the real estate industry. Both technologies can play a vital role in seizing people’s attention and can provide the ultimate convenience to both customers and realtors.
A virtual 3D property walkthrough can be a highly appealing experience, it helps buyers to see the 360-degree view of each room. The buyers can move around the property and be provided with décor ideas when the property is fully staging and also can customize the home to their liking by adding furniture as well as moving items around to really bring their vision of the property to life, providing a truly cutting-edge customer experience.
Furthermore, such technology can also help realtors attract international buyers by removing any geo-locational restraints.
4. Blockchain for transparency and security
Blockchain is a decentralized ledger of transactions through a peer-to-peer network. It allows customers to make transactions without the need for a central certification authority. It is a revolutionary technology which has the power to transform many different industries including real estate.
For example, it can be used to transform core real estate operations such as property transactions including purchasing, sales, financing, leasing, and record management.
It also has the power to transform norms around high value asset transactions which are typically done face-to-face. Through smart contracts, enabled by blockchain platforms, assets like real estate can be tokenized and safely and securely traded like cryptocurrencies.
The technology can solve several property-related pain points, such as preventing fraud, improving security of digital transactions, and cutting out the middleman when it comes to getting permits, notarizing forms, and performing other business support functions.
5. Mobile Apps can serve many purposes
Searching, buying, renting or selling houses using smartphones is increasingly becoming more commonplace as mobile technology has made the process easier and more convenient.
Mobile apps can allow players in the real estate industry to make use of mobile features such as push notifications, camera, and GPS integration and offer access to real estate tools such as a mortgage calculator for property investment.
Most crucially such apps offer fast and efficient customer engagement opportunities and can act as a channel to bring buyers and sellers closer together.
When building a mobile app in the real estate industry, it is important to bear in mind the purpose of the app. The target audience’s needs and expectations and consider how the application fits into a wider digital strategy which enables a seamless and consistent customer experience across touchpoints and channels.
6. Chatbots for customer engagement and lead generation
Chatbots can be found in almost all industries nowadays, but how can they increase efficiency in the real estate industry? Consider when a customer wants to buy something online, when they ask the seller for more information, if the seller is able to respond quickly, the chances are higher that the customer will make the purchase.
The same concept applies in the real estate industry, where chatbots can give an immediate response to customer queries when they are in the final stages of the customer buying cycle, which means customers can get the information they need right away.
Moreover, if customers are in earlier stages of the buying cycle, chatbots can be used to capture relevant customer information (such as name, contact details and buying preferences) which support lead generation and can ultimately lead to sales in the future, if the customer information captured by the chatbot is supported through a strong customer relationship management (CRM) approach.
7. IoT for Smart Living
The importance of IoT (internet of things) in real estate is crucial as this technology can bring new life to physical objects, embedded with software and network connectivity, homes can be transformed through features such as automated doors, smart locks and smart refrigerators which can be controlled through smartphones.
Such cutting-edge technology can make homes safer and more secure, improve energy efficiency and improve the overall experience of the home which ultimately can result in higher market value for homes which make use of IoT and smart technologies.
A McKinsey & Company study has found that the pandemic has accelerated the digital transformation agenda of many companies by up to seven years. Since societies are changing towards a more digital world, the real estate industry has to integrate technologies into its business fundamentals to continue serving customers.
Digital innovation will continue to disrupt business models across various industries, meaning it is increasingly important for real estate industry players to continue embracing new technologies to remain relevant and fend off the threat of disruption.
To do so, companies must move away from pre-pandemic organizational orthodoxies which have been uprooted by digital transformation and continue with a more digital-first approach, which will not only help the industry thrive during this crisis but will also help them to accommodate the needs of millennials as this digitally savvy customer cohort becomes increasingly interested in property investment and buying opportunities.
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