The role of technology in improving the future of real estate

Much has been written on the topic of technology in real estate and, despite much desire to anticipate rapid changes, many things remain the same.See, for example, the bureaucracy and lack of dataor access to these, which happens chronically in Portugal (and even in many other countries). There is much to explore about what technology intends to do for the real estate market, or rather, the real estate market, and not In a critical tone, I will also write a little more about my future vision on this topic. In my opinion, technology has to have a very clear mission for this sectorand that mission may well be to turn the real estate market into a less imperfect, more transparent and more agile.It may be ambitious, but I believe it will be possible. Only time will tell, and I hope I’ll be here to see it. So, with this vision in mind, I’m going to talk about the main features of this imperfect real estate market as it still is today, and what technology can do to improve it.

fixity

The real estate product is fixed, that is, it does not move. Then the product is automatically conditioned by location. The best way to get a good acquisition, a good sale or a good investment is, in general terms, getting all possible information about the property and the area where it is inserted, this information must be from a credible and reliable source. Technology has evolved and helped people and professionals to obtain information to support their decision, from virtual visits, 3Ds, websites that provide all the information about the property and the area where it is located, with the possibility of comparison, and metasearch, to to georeferencing. Today, through a smartphone, you can access and see a property inside and out, but the possibility of data that can be obtained about its surroundings is immense and the intersection of these with the creation of a lifestyle that will always be associated with the (fixed) location and the infinite possibilities of how one can live the property can help to create a much clearer view of one of the most important investments for many people. Also read: Prospecting in the palm of your hands

little liquidity

The real estate product is, in general, a low-liquid product, that is, slow to turn into cash. This characteristic persists due to the bureaucracy associated with the purchase and sale transaction, and of course, the high transaction amounts that require, in most cases, available capital and financing, at least for most people. These factors lead to a clear slowdown in the transmission process. Despite several efforts in recent decades to make the bureaucracy smaller and smaller and the process more and more transparent through digital, we still have a long way to go in relation to Blockchain and Token technology that will clearly allow a reduction of bureaucracy in the transmission process and also a democratization investment in the real estate product as it allows partial acquisition at lower prices, making the real estate product a more liquid product.

seasonality

Lifestyles change, the possibility of travel within and outside the country becoming faster and more accessible and a less bureaucratic acquisition process, could make the seasonality that still exists in some real estate markets less evident. promote this mobility associated with the real estate product it is definitely an opportunity.

Unique product (no properties are alike)

A bit like fixity, real estate products will continue to be unique. Obtaining credible, transparent and relevant information associated with the possibility of making transactions through Tokens will make the fear of buying a pig in a poke lessen. There is also a tendency for future buildings to to be less and less heterogeneouswhich will make choices easier as they are less unique, although I believe that acceptance of this trend will depend on market by market and from area to area. Also read: The commission is expensive!

Valuation vs. Degradation of the property and the non-existence of a Real Estate Exchange

The market will continue to fluctuate, possibly the cycles will be faster due to the access to information that technology brings us. Immediate access to information will make it possible to find out how much a property is really worth at a given time, and it is also possible to know at the time how many properties of that type are on the market, what the values ​​of the last sales were, and not only in the last months, but also in the last week, or even in the last hours, as if from a stock exchange treat. Metasearch already has the technology available and will evolve to make more and more data available that will be treated and crossed with the prediction of future data that will help in decision making. Access to crucial data has still been a barrier to be overcome in Portugal, which continues to act in a very non-transparent way.

value of good

Real estate assets will increasingly be of high monetary value, therefore scarce and difficult to access. Leasing will be a trend just like coliving and other similar solutions. Once again, the Blockchain will allow the acquisition of real estate using tokens that allow you to acquire parts of the house quickly, safely and transparently. The current divisions made in horizontal property may fall to the ground to allow anyone to access the investment.

Absorption and Process Time

The reduction of bureaucracy in the transmission process will allow more speed and fluidity in the market with faster cycles, and the time variable that makes the market so expensive may no longer be an obstacle. The technological change associated with licensing, whether for new works or rehabilitation, will be crucial for this change that technology can bring and which is so important.

Scarcity and low supply elasticity

The scarcity, as well as the time it takes to replenish the stock of properties to meet market demand, is not just limited to a change in terms of the licensing processes that I mentioned above. Clearly the new construction technologies will allow simpler, faster and safer works for a building with greater standardization, higher quality, lower maintenance and greater sustainability. These changes are no longer fiction, are happening all over the worldand even in Portugal, at your pace. The big challenge is not the technology, but the mentality of people and, in particular, of institutions. In my opinion, people are open and in urgent need of these improvements. Unfortunately, those who govern them do not prioritize in the same way, proving to be averse to changes that have to happen regardless of the pressure for them not to happen. Finally, a last word for real estate agents, and also for appraisers and other players who, on several occasions, feel threatened by changes that come to happen. True professionals will play an increasingly important role, although different, possibly less executing and increasingly more of advisory or specialized advice associated with experience and capacity for vision and interpretation. I would say that we will move from the figure of Real Estate Agent to Real Estate Advisera profession that I continue to see as a profession of the future because this market is a market from people to people.Read more: The (in)faithful buyer “Real estate is my life and my life is dealing with people.” Living in Lisbon and working in Portugal, Spain and Italy, Massimo Forte is above all passionate about real estate, a business that he considers to be from people to people. With more than 25 years of experience in the largest real estate brokerage companies, he is now dedicated to consulting, training and sharing knowledge as one of the biggest Real Estate Influencers in Portugal.