 | By Brian Burte, Manager |
To succeed in this digital era, companies of all kinds must be firmly grounded in technology. That’s as true for us at Wiss as it is for our clients in a range of industries, including real estate. And while real estate has traditionally been slow to adopt new technology, that is changing fast.
Our real estate clients are using technology to automate many business functions, such as accounting, HR, and payroll. And they are using digital tools to make use of data — a particularly useful task in such a data-heavy field.
To be able to use data most effectively, those in the real estate industry need first to become familiar with the many ways that it can disrupt traditional ways of working. Let’s take a look at how things are changing.
How PropTech and big data are disrupting the real estate industry
Data can be applied to many aspects of real estate, from valuations to application processing. In fact, it is already transforming many aspects of the field. For example, analytics allow listing websites to create automatic property valuation estimates — very valuable information that previously could only be obtained via an appraisal.
Such data-driven tools and online access to information are quickly changing how the industry works, but many companies in the real estate space are mostly in reactive mode when it comes to using data in their business.
This is because even though many of our real estate clients are digitally savvy and have no problem accessing or collecting data, they struggle to figure out how to best organize it and apply it to improving their business. Companies typically spend 80% of their time mining data and 20% analyzing it, leaving tons of valuable business insight in the dustbin.
Real estate industry professionals can improve their operations using PropTech and data to do things like better personalize marketing efforts, mitigate risk using predictive analytics, and process applications faster and more efficiently.
The top 3 ways to use data in real estate
Here are three of the most effective ways that real estate professionals can use data to do business more efficiently and effectively.
1. Risk mitigation and predictive analytics
Real estate is all about risk — the greater the insight that buyers, sellers, and agents can get into probable market fluctuations, the better off they’ll be. With today’s technology, computer algorithms called predictive analytics can give us a peek into the future with a level of certainty far higher than in the past.
These analytics can harness data on a wide range of factors, such as appreciation and crime in specific areas. The resulting analysis produces a comprehensive picture of the potential risks and benefits of investing in a specific property at a certain time.
2. Target marketing and accessibility
PropTech can harness data to enhance real estate professionals’ ability to market in a personalized way to specific buyers. Predictive analytics and machine learning can be put to work gathering information on a potential buyer’s online activity and profile, which can help agents direct them to properties that might best suit their needs.
Technology also helps make it easier for buyers to access the details of proprieties, both through data-heavy listing platforms and through remote technologies like virtual reality and augmented reality.
3. Property management through Internet of Things (IoT) and data management
Technology can also help owners manage their properties using smart devices and data management platforms and apps. Tools exist that can help increase billing efficiency, manage tenant communication, organize record-keeping, and keep track of maintenance needs. Smart systems can track things like utility usage, energy efficiency, and security issues.
Owners can use all that data to refine their management priorities and allocate their maintenance spending. Data management tools can also help with speeding up turnover and filling vacancies.
The responsibility of PropTech in the real estate industry
PropTech tools are powerful, and most of that power comes from the access to and use of data. Some of these tools store and make use of private and personal data, such as information on tenants of an apartment building. It’s important for such tools to be secure against incursions by bad actors.
Other PropTech tools may work to collect information on customers, such as their online activity, real estate preferences, and other personal details. It’s important for those using these platforms and tools to ensure that data collection is done responsibly and consumers’ privacy is safeguarded.
While some in the real estate industry may not be quick to adopt PropTech, these tools have the potential to transform much about property management and sales — and open up the door to many new possibilities. Wiss can help real estate professionals and companies choose and implement the PropTech tools that will enhance business while keeping data secure.