Technology has impacted just about every field of human endeavor you can imagine, and that includes real estate. From buying and selling apps such as Zillow and Realtor to website-based tools and apps designed for individual agents, tech for real estate is evolving every bit as rapidly as it is for other professions and industries.
So what can we look forward to in the immediate and not-too-distant future? Here are the top four real estate tech trends that will dominate in 2020.
It’s the era of Big Data, and most industries are still working to understand what kinds of data they have access to, how best to analyze that data, and what to do with the insights that data provides. In real estate, business intelligence that flows from massive quantities of these metrics and measurements is already being used in real estate apps and property management processes.
For example, the algorithms that help drive this analysis can help the business behind an app predict what a user is likely to do. That helps the business optimize the app to make that choice as frictionless and pleasant for the user as possible. This kind of deep-level data analysis can also help an agent or management company optimize operations to drive more clients, purchases, sales, rentals or other metrics.
HomeLight’s top agent insights survey from Q4 revealed that over 25% of the responding agents picked iBuying as the trend that will have the biggest impact on the real estate market in 2020.
iBuying, a strong real estate tech trend, is a service that allows homeowners who want to sell their property to do so quickly and efficiently online for cash, doing away with the complexities and legalities involved in a traditional mortgage-financed purchase.
These services, such as Zillow Instant Offers, Knock, and Redfin Now, among others, use automated valuation models (or AVMs) to help assemble offers on homes quickly. Closing can take place in days. These residential real estate investors then work to sell the property quickly for a profit.
That profit is maximized at least in part by the discounted purchase price the investor pays for the property in the first place. Because of these lower average purchase prices, the iBuying process is generally best for sellers that need to move quickly for some reason—for example, a sudden financial hardship or a new job in a different location. As these precipitating events continue to occur, iBuying is likely to grow as a viable option for sellers under pressure.
Anyone who’s ever closed on a house knows the seemingly endless stream of paper documents with hard-to-read small type and strange legal terms that you have to sign and initial in order to finalize the transfer. Those documents must be prepared, reviewed, printed and assembled first, and that can take a lot of time.
Digital closing platforms help reduce the time and paperwork involved in closing a home sale. These platforms utilize cloud computing and new developments in digital security to create a more streamlined, paper-less experience. Digital home closings are growing in popularity and legality nationwide, and this trend is likely to continue.
The Internet of Things (or IoT) will likely enjoy an increased footprint in residential real estate. Home security, environmental controls, lighting, fire and smoke alarms and more are already controlled or monitored by mobile apps, for homeowner convenience.
As IoT-powered home tech increases and expands, it’s likely that smart real estate agents will begin highlighting these features in their marketing efforts for homes on the market as highly popular selling points.