Digital disruption has taken the world by storm, accelerated, no doubt, thanks to the pandemic and an even larger reliance and need for technology. This tech is driving both the business and consumer sides of CRE trends. Consumers expect and are choosing more digital experiences. CRE businesses must adjust to meet this demand.
The National Association of Realtors’ 2019 Profile of Real Estate Firms found 44% of CRE companies identified keeping up with technology as their biggest challenge they’re facing. Only local or regional economic conditions ranked as a higher challenge, at 46%.
A Global PropTech Survey of real estate market players found:
- 58% of respondents have embraced some digital innovation
- 62% of RE businesses have a senior-level manager leading the company’s digital transformation
- 40% of respondents have yet to prioritize digital
- 25% of companies have a solid data strategy, but an overwhelming 75% have only slight to little understanding of effective strategies to handle datasets
- Challenges to tech adoption include a lack of skilled specialists—in-house or consultants—to implement RE tech solutions (and train the professionals how to use them)
Some of the biggest challenges and trends facing CRE companies today include:
Augmented reality (AR) which, in the real estate world, means using digital platforms to allow clients to tour properties. Using their phones, AR allows customers to virtually “walk” through a building or space. It’s more effective at picking up details a standard photo can’t convey, and AR allows viewers to focus in on details that interest them—rather than only on what the photos show. Over 64% of buyers have said 3D and VR helps them gain a more accurate idea of size and volume. Perhaps the biggest benefit to a virtual tour? Saving time!
Online accessibility, which is prevalent in all other areas of life from buying clothing and groceries to booking a trip or scheduling a doctor’s visit. Clients can conduct research, buy, sell, rent, solicit bids, and put in offers online. How much do real estate clients rely on online accessibility?
- 90% of baby boomers and 99% of millennials start house hunting online
- 77% of realtors use social media to promote their real estate business
- 47% of real estate professionals have seen social media generate higher quality leads than other sources
Big Data, on which realtors, developers, investors, and others involved in CRE rely to inform decision-making. Machine learning (ML) and automated algorithms have become invaluable for helping to identify trends by gathering, aggregating, and interpreting vast quantities of data.
Property and technology—or PropTech—offers another tech approach to real estate. It’s a digitally-driven disrupter in the industry and it refers to business-specific software like mobile apps and software within the RE software development services. Think of PropTech as similar to FinTech or HealthTech, where it represents a robust alignment between technology innovations and the industries adopting them.
Digital platforms, a part of PropTech, offer significant value to real estate professionals because they improve work processes and streamline costs. The most common use of these platforms includes automating previously manual processes and digitizing paper-based tasks, which virtually eliminates human error and enables people to address more critical tasks.
With today’s software capabilities, signed documents with an electronic signature take mere minutes to arrive. The traditional process often required a week or longer. We can’t disagree that, in the CRE world, time is money. So, the faster a company can digitize—and speed up—its processes, the better! And it’s one reason experts anticipate the market for RE management software will hit $12.9 billion by 2025.
Embracing Digital Transformation
Many industries, including CRE have been slow to identify and implement technology. But those have recognized its value and adopted technology earlier have positioned themselves to reap higher benefits from changing markets.
In fact a CRE Innovation Report 2020 found 8 out of 10 CRE businesses employ a chief data officer tasked with overseeing the organization and management of data strategy and governance, up from 2016 when 44% of companies lacked or didn’t prioritize this role.
CRE leaders are recognizing that implementing and using this technology is one of the keys to staying competitive and planning for the future. Steps they can take include assessing and evaluating skills matrices they need—and analyzing currently manual jobs which would benefit from automation, for example.
Companies can automate tasks like invoicing. Leasing managers can employ predictive analytics to develop different lease optimization strategies. Appraisers can develop more robust valuations by using technology. CRE leaders worried about their employees’ skills can cast a wide net into the alternate workforce of tech-oriented gig workers, freelancers, and contractors to assist.
Talent Transformation and Digitization
How we work has changed. We’ve pivoted to all virtual or hybrid work environments. Mobile-friendly tech works well to recruit and onboard new staff. Data analytics and applicant tracking systems (ATS) can economize and speed up resume sourcing and screening. This tech enables faster identification of qualified candidates with the right skills a company needs. Candidates can schedule or respond to interview requests in real-time.
Championing and promoting well-being among employees
The forced shift to working 100% from home blurred the lines between personal and professional time. Stress levels rose as employees felt pressured to work more and turn off less. Many leaders who recognized these stresses worked to create a culture supporting and promoting emotional, mental, and physical well-being—via online platforms.
All industries see the need to continue well-being initiatives that support employees and promote continual learning, engagement, and motivation. One strategy to continue promoting a culture of mental and physical health and wellness includes offering flexibility in the workplace—an approach made possible by the technology tools available today.