Tech trends in Real Estate to Watchout For in 2022
The real estate market in Nigeria has seen a positive change over the years, and this can be attributed to the technological progress that makes business more efficient and convenient. Due to the advancement in technology, real estate marketing was upgraded, and homebuyers do now have a broader choice when it comes to buying properties.
Africa as a continent is less developed than other continents but has imbibed technology as a means of improving Infrastructure. There is currently an infrastructure boom across the continent, which is driving the growth of the whole Real Estate sector, as real estate developers in African cities like Lagos are creating commercial and residential real estate opportunities for investors and prospective homeowners to latch unto through technology and innovation
It is evident that the role technology plays in real estate cannot be overlooked.
This is why if you’re into the real estate business, it will be to your advantage to know what’s the latest in technology to keep up with the business competition.
Technology has improved the way we work and live; it will change the future of work as more technologies are going to be deployed at the workplace increasing productivity in the process. Most industries have started incorporating technology into their operations, and you cannot blame them because let’s face it, technology is the future.
Here are some of the latest tech trends to watch out for in the real estate sector
SMART HOMES: Cast your mind back to the ’90s when home automation was still very much what you will see in SciFi movies but now in the 21st century smart homes are now a part of the built sector which can be attributed to the Internet Of Things (IoT), which is a system of interrelated computing devices mechanical and digital machine objects that are provided with unique identifiers.
In the IoT framework, the devices do most of the work without human intervention although people can interact with the devices, for instance, to set them up give them instructions or access the data.
The introduction of smart homes technology to the real estate sector has helped revolutionize the industry.
The resulting intelligent building market is largely empowered by using IoT in real estate, hence IoT items like automatic light control, smart door locks or smart thermostats are in high demand for prospective homeowners.
Buyer demand for smart home controls is thus also expected to grow this year as most real estate developers are incorporating this functionality in their projects.
In addition, one cannot but admit that hundreds of sensors connected to IoT platforms are contributing to the enhanced quality of the tenants and residents’ experiences. as “IOT” is becoming the future of real estate technology especially in commercial cities like Lagos, where most real estate developers are leveraging this technology, to enhance customer experience and brand loyalty.
LOCALIZATION AND THE POWER OF GEOLOCATION:
The power of geolocation cannot be overemphasized as more real estate agents than ever before are anticipated to go hyperlocal, which entails an agent breaking down marketing and sales activity to the smallest target area or demographic possible. One of the reasons is that property owners are getting disconnected from real estate agents.
Consequently, more real estate agents are focusing on what can make delivered services more valuable on local property marketing. Being one of the hottest real estate technology trends, geolocation can help realtors focus on this market demand. There are quite some things that can go wrong without the real estate agent’s help and a smart specialist has to take care that the information they are providing is exclusive and highly relevant. For the curious mind geolocation technology in real estate implies the ability to track an address or property using a combination of Gps, Cell phone towers, WIFI access points etc.
Geolocation technology, in turn, helps not only pinpoint the physical location of the chosen property but also visualize such parameters as property data, county maps, topography, flood zone maps, soils to assess the land value.
VIRTUAL AUGMENTED REALITY: Another huge real estate technology trend is virtual reality (VR.) This trend makes use of computer technology to create a simulated environment that can be explored in 36o degrees by placing the user inside the virtual environment.
With the introduction of VR/AR, the real estate market is claimed to enter the third synthesis phase which enables an increase in the efficiency of physical spaces’ management. Due to restriction of movement as a result of the covid 19, pandemic lockdown in 2020 most real estate companies embraced the use of virtual reality to enable prospective home buyers to inspect their property without being physically present.
Real estate investors and potential homeowners are expected to increasingly use VR technology to view homes through spatial visualization without even visiting the chosen property. This will save valuable time and money offering a higher quality experience to the users.
BLOCKCHAIN TECHNOLOGY IN REAL ESTATE:
Since the 1910s, real estate agents have acted as middlemen between the seller and buyer. Having the agent facilitate the property transaction helps establish a level of trust between the two parties. The agent is an expert on the local laws and regulations. So they can confirm that the seller actually owns the property and the buyer has the funds to buy it. To this day, the industry uses the same tactics and practices.
However, blockchain is slowly but steadily transforming the process. On January 9, 2009, a group of people (or an individual – no one knows for sure) under the pseudonym Satoshi Nakamoto released the very first version of bitcoin, and subsequently, the blockchain database. Nine years later, in February 2018, America oversaw its first blockchain real estate transaction in Vermont.
By now, you’ve probably heard of the non-fungible token (NFT) trend that blew up at the start of 2021. In simplest terms, an NFT is a type of digital currency that is unique and not replicable. The metadata of the token contains unique, non-replicable codes. However, amidst NFT becoming a part of the mainstream lexicon, let’s not forget about fungible tokens (FT). You’ve definitely heard of FTs at least once in the past few years. Cryptocurrency, including Bitcoin, is an example of fungible tokens, meaning that all tokens are identical and can be divided.
Both non-fungible and fungible tokens live on blockchains. A blockchain is a system of recording information and storing data in a way that makes it nearly impossible to change or hack. Think of blockchains as digital records of transactions. And those transactions are distributed across a network of computer systems on a particular blockchain.
Blockchains have been around long before the recent NFT trend. In fact, property owners and investors often use blockchain and real estate in the same sentence. In the coming years, blockchain and other property technology will radically change how we develop, buy, own, and invest in commercial real estate.
What Lies Ahead?
There are predictions about how blockchain can change and revolutionize the industry.
The year 2022 is envisioned to finally adopt blockchain to bring security, clarity, and efficiency to real estate transactions. There are two ways in which blockchain would help the real estate industry namely:
- Smart Contracts: in a nutshell Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met. They typically are used to automate the execution of an agreement so that all participants can be immediately certain of the outcome, without an intermediary’s involvement or time loss. The problem with traditional contracts is that they are meant to describe mutual terms of agreements, which are often ambiguous and can be interpreted from multiple angles. This is why parties can spend huge amounts of money and time arguing about what exactly the contractual terms are trying to enforce or what the exact duration of the agreement is. While smart contracts don’t solve the problem entirely, they can decrease the overall vagueness of conventional contracts. The process of transferring property ownership has become stressful and often risky for both sides of real estate transactions. In very simple terms, the seller is hesitant to transfer the ownership before receiving funds, and the buyer is afraid to send money before receiving the property. Up to this point, the most effective method was to use third parties such as notaries to ensure agreement fulfilment and increase security, which, in turn, raised the costs associated with transferring property ownership and caused delays.
Essentially, smart contracts solve the aforementioned problem by consolidating all the functions of notaries and brokers into one autonomous mechanism.
2. Tokenization: It is the usage of cryptocurrency for dividing assets into tokens that will be stored on the blockchain. Tokenization in real estate changes a lot for different participants. For example, it enables customers from different locations and uses the different incomes to be a part of the investment process.
Tokenization here means converting a real asset into several digital tokens and selling them on an online marketplace. The people who purchase these tokens own a portion of the asset. This asset exists as a blockchain-based digital token. Every token here represents direct ownership of an asset. These assets can be a piece of real estate, shares in a company owning real estate, participation in a real estate investment fund or anything else.