Until recent years, there were not any major changes happening in the real estate industry, as the companies were not exploring all the opportunities available to them to facilitate digital transformation.
However, things now are looking poles apart - all thanks to the changing consumer behaviour & technology that has forced the key leaders of the segment to experiment, and embrace new technologies to meet the industry demands.
Plus, with the worldwide COVID-19 outbreak, the process of digital transformation in the real-estate industry has gained monumental importance, as the post-pandemic world functions with a large set of restrictions.
All this leaves real estate companies with no other choice but to accept digitization with their arms wide open.
What Is Digital Transformation?
In the simplest form of words — Digital Transformation means either improving the existing set of processes, or introducing new ones to carry out business activities — with the help of Digital Technologies.
So, in essence it means to define/redefine your processes according to the digital era in order to make things more efficient and effective.
What Makes Digital Transformation So Important In Real Estate?
The fact that digitization improves your business processes is not the only reason that makes digital transformation so important in the real estate sector. There are other reasons too, such as:
Changes In Housing Searching Processes
With the emergence of digital marketing as the most viable and popular marketing practice by companies across the globe — the way consumers search for real estate properties has changed considerably.
This makes digitization in real estate a matter of utmost importance for companies who have to be visible to their customers.
Changes In Consumer Demands & Expectations
There has been a drastic shift in the consumer mindset in recent years — especially, when you compare it to how they used to find potential properties almost a decade ago.
Unlike the old days, customers now want complete details about your properties so that they can make informed & calculative decisions accordingly.
Changes In Consumer Technology
Thanks to the growth of online real estate websites such as Zillow and Apartments.com, the nature of the conventional real estate business model is evolving — as there websites offer key insights about the properties such as images, realistic size measurements, their exact locations via google maps, prices and even virtual walks talks to technologies such as AR and VR.
Therefore, the retailers must adapt to all these technological changes if they want to succeed in the current market scenario.
Digitization Trends That Would Drive Real-Estate Industry Forward In 2022
1- Big Data
If you think Big Data has something to do with a lot of data — then you are absolutely right.
In essence, Big Data refers to the technology that is used to automate the analysis and interpretation of a mammoth amount of data, from multiple sources — to give a much more accurate & concise result.
Big Data is extremely useful in Real Estate as it enables retailers to allow their users to go onto a singular platform, such as Zillow Rental Manager, and compare hundreds and thousands of real estate properties on the basis of multiple parameters — and find the one that suits them the most.
2- Equity Crowdfunding
Although it’s still in the natal stage — but like all the other sectors, crowdfunding has heavily democratised investment opportunities in the real estate sec tors too.
In the past, the way through which the real estate developers used to raise capital were pretty restricted, but crowdfunding completely disrupted the old rules.
Equity Crowdfunding initially attracted smaller developers, who did not have the means to raise capital using the traditional route, which investors used to see as a risky investment.
But now, we know you can see many major developers using crowdfunding platforms to fund commercial real estate projects worldwide.
In digitisation of real-world assets, Blockchain is playing a major role as it can bring security, clarity, and efficiency to property transactions when it comes to real estate.
Besides this, there is one particular way through which blockchain can revolutionize the industry — Tokenization.
Tokenization refers to the use of cryptocurrency to division of any property and then convert it into tradable shares or tokens, which could be stored on the blockchain networks.
You see, tokenization could provide developers with a lot more freedom and flexibility to acquire capital, investors can efficiently move their funds and property owners can oversee their own equities more effectively — particularly in cases where liquidity and transfers always pose a problem, such as fractional ownership sales.
Moreover, liquidity has always been the biggest stumbling block in real estate investments. With blockchain and tokenization technology in place, secondary markets could conceivably trade these asset-backed currencies, to provide liquidity in property, which in the past was not possible.
4- AR + VR
In the real estate sector, modern technologies such as Virtual Reality (VR) and Augmented Reality (AR) are in full swing. It was invaluable for retailers to keep their business moving as usual during the pandemic lockdown.
And since people were seldom moving out of their houses — retailers were using digital video calls & conferencing to connect with people and to make them understand their ideas and appeals better.
You see, it’s one thing to judge a place by looking at its 3D model, but it’s an entirely different experience to transport yourself to that place using VR technology.
And because most of the time people have a hard time envisioning the place just by its 3D model — Virtual Reality took things up a notch there, without even going anywhere.
5- BIM — Building Information Modelling
With the Building Information Modeling, the real estate and construction industry already has significant savings ,which are only going to bump up in the coming years.
BIM is a process with which the entire project team shares all the project-related data with one another, such as 3D graphic models and non-graphic data, all connected together to a 3D model.
This 3D model gives users access to data such as what materials the buildings are made of, who created them, how much it costs, how much time they need to complete and more advanced information at a single mouse click.
By combining BIM with virtual and augmented reality, real estate companies can provide an in-depth analysis of properties like never before.