What initially was a foot-dragging adoption is finally gaining a more dynamic pace. I’m talking, of course, about the use of emerging technology in the real estate industry, which is living the so-called 3rd wave of Proptech.
Such a trend is seeing how big players in the field are betting on artificial intelligence, drones, and blockchain to achieve some impressive benefits for everyone involved. This fundamental shift in property technology is seeing how businesses and realtors are embracing new solutions to create, develop, renovate, buy, sell, market and manage real estate.
With Asia leading the way in terms of investments, construction companies and building owners are increasingly outsourcing development of highly sophisticated platforms that can offer a new way of doing things. From enhancing maintenance routines to increasing building efficiency and improving real estate operations, there’s a lot that technology can do for everyone related to the property field. Here’s what’s happening.
Artificial Intelligence as the Foundation for New Real Estate
Proptech 1.0 brought us new startups that focused on online platforms to offer web listings for residential properties. Proptech 2.0 saw those platforms growing more complex and sophisticated to offer new services based on data analytics and virtual reality. But none of those compare to what Proptech 3.0 is bringing to the table.
The more widespread use of new technologies is already transforming the real estate landscape. And all of it is mainly based on AI-powered tools that leverage the huge amount of data that’s available in the industry.
For instance, several construction companies already equip their buildings with sensors and systems that can collect information about the status of different equipment. Thus, they can easily monitor and adjust systems including heating, elevators, lights, security cameras, and networks.
For building managers, this means they can easily detect the need for maintenance and adjustments in those systems and in the entire building structure. Occupants, for their part, can also access that information, which allows them to learn about their use of those systems as well as to control them remotely.
Additionally, there are new companies that are working on platforms that use AI to predict consumer behaviors and trends to offer insights. Using artificial intelligence for that isn’t precisely new, but businesses like ThoughtWire are working specifically with the real estate industry to create tailor-made solutions to fill the field’s specific needs.
Those same systems are also of use for real estate businesses in their daily tasks. With their aid, they can better estimate property values, provide a more personalized service, and even automate repetitive tasks, such as giving out quotes to prospective clients.
Inspections Through Drones
Historically, the real estate industry has needed to relieve on-field information for different purposes. Usually, that process implied inspectors going to the site or building itself to take photos and use specialized equipment to take measures. They did so to detect energy inefficiencies, identify potential maintenance needs, and look for areas of improvement.
Thankfully, new technology has come to the rescue in the Proptech 3.0 era. With the increasing popularization of drones, there are now more available for constructors and real estate businesses to map buildings, monitor them closely, and scan for information.
The best thing about it? Using drones significantly cuts down the costs of relieving information, as there’s no need to use planes or helicopters anymore. Besides, drones can be used to create virtual replicas (known as “digital twins”) that can be of tremendous benefit. By installing sensors throughout a building and connecting them to those digital representations, owners and constructors can access vital information in real-time.
Added Security with Blockchain-based Platforms
The third major advance in Proptech 3.0 isn’t quite here yet, but some people are expecting it to hit the industry soon enough. I’m talking about blockchain, a decentralized digital ledger that’s the basis for cryptocurrencies such as Bitcoin. This technology allows for highly-secure transactions that can be enforced automatically via smart contracts.
Smart contracts are a series of predefined rules that govern a specific agreement. Thus, if the people involved in a smart contract meet certain criteria, a specific action is triggered. This would be great to simplify the buying and rental process, for example. Anyone interested in buying a home would sign a smart contract, the real estate agent would do the necessary background check and, if everything is ok, the transaction could be done automatically.
This would save companies a lot of costs both in terms of money and time. This would also reduce the need for lawyers and accountants to manually check all the information needed for the agreement to take place. What’s more – this could also bring cryptocurrencies themselves into the sector, making the entire transaction automatic and smooth.
The best thing about blockchain? The potential security benefits it would bring to the industry. As a decentralized technology that uses cryptographic hashes in all of the blocks that form the chain, all the data used there would be inviolable and permanent. What’s more – since all transactions are conducted through private keys only the holders know about, the entire data would be anonymous.
Some Final Words
Though some of these things seem like technologies that will be available in the future, the truth is that they are here right now. Initiatives like Virtual Singapore and companies like ThouthWire are already showing us the way that the real estate business will tread in the coming years. But that’s just the beginning.
Once the industry becomes familiar with the possibilities of emerging tech, I’m positive that it will explore further options. Thus, 3D printing and cryptocurrencies appear on the horizon. On one hand, state-of-the-art 3D printers could create every little bit of new buildings, from beams to lighting fixtures. On the other, the rise of cryptocurrency should definitely have the sector among its early adopters, as the industry moves millions of dollars per year.
These are exciting times for the real estate industry, especially considering that the third wave of Proptech has only just begun. With such a strong start, one can’t help but wonder what are massive changes are waiting for us around the corner and how will they impact the work in real estate for good. Only time will tell!
