Real estate has traditionally been a great wealth-builder, which is why some of the richest people in history have been real estate investors. Today, this still rings true, but real estate transactions have remained notoriously old-school, which makes buying and selling real estate more difficult than it needs to be. Traditional property transactions are notorious for being too time-consuming, too complicated, and too expensive to name only a few issues which are affecting the modern real estate investor.
Now, an increasingly tech-centric public is seeking more efficient real estate solutions that will fit with their modern lifestyles. This is how technology is streamlining real estate transactions for the better:
The Problem With Traditional Real Estate
The growing demand for technology and convenience in all aspects of life is fueling massive changes in the usually-traditional real estate industry. At present, the real estate sector makes up an estimated 60% of the worlds biggest mainstream assets, yet it’s one of the least tech-savvy industries. l. the industry is still mostly driven by age-old and paper-heavy processes. Property transfers can take weeks to settle due to the steps and intermediaries involved, and the industry is also more susceptible to fraud, typically caused by confusing or deliberately misleading legal agreements.
But the worlds of real estate have been steadily shifting; the need for newer urban and modern infrastructure in real estate is driving tradition out of the market in favor of tech-based solutions.
Introducing Technology
These slowed-down processes have led to a crossover, introducing more tech investors and innovative solutions into the real estate sector in the form of Proptech, or property technology. These tech solutions are cutting out middlemen, helping investment in effective management services and lowering the costs significantly for real estate investors. New and promising tech-based offerings are also giving investors new options for investing in real estate, like REIT’s and other online-based solutions.
Some of the most exciting technologies poised to make massive changes in the real estate industry include virtual reality, machine learning, blockchain, cloud technology and others that can streamline real estate transactions and management in multiple ways. This promising phase of real estate is still being developed, and Proptech companies are working to scale effectively in order to create products suitable for residential, commercial and other real estate investments.
Blockchain For Real Estate
With traditional real estate transactions, a purchase will typically involve the investor dealing with multiple intermediaries such as brokers, escrow services, land registries and others, requiring plenty of paperwork in order to close the deal. Blockchain is one of the proptech innovations marked to streamline real estate transaction processes and times. With blockchain, the foundational technology allows investors to engage in transactions directly with each other, improve title and property ownership records and transfers, handle data and retrieval services in a transparent and low-risk manner.
One such company working with real estate and blockchain is Propy, the international real estate transaction broker creating a global asset transfer platform. Companies like Propy are at the forefront of adapting to changing real estate consumer behaviors.
Tossing Out The Paper
Many companies in the proptech sector are working on solutions which can reduce the length and difficulty of property transactions for investors. Dotloop is another such company providing new options for real estate investors, creating electronic document signing and real estate transaction management systems that are easily available online. Paperless transactions will be a huge game-changer for the real estate industry, and also lessen the industry’s carbon footprint somewhat.
So far, Dotloop has helped $30 billion worth of transactions take place seamlessly per month through their platform, only a drop of water in the ocean of possibility ahead. Proptech startup statistics, in general, have shown that in the first half of 2019 nearly 68% of CEO’s were targeting commercial real estate, with 33% targeting residential real estate specifically.
The old-school nature of the real estate industry is steadily turning into something new. The real estate sector makes up an estimated 60% of the worlds biggest mainstream assets but involves too many transactional expenses, time-consuming processes and other issues to reach its full potential. The proptech advancements being made are changing real estate transaction processes and times, with companies like Propy and Dotloop leading the charge amongst others to push the industry forward.
The real estate industry is being modernized, and technology is streamlining real estate transactions for the better.