It’s been a big year for real estate technology. Bigger, in fact, than in most years before it. In January this year, the New York Times asked the question: “What Does a Real-Estate Broker Look Like in the Age of Airbnb?” The answer? A lot less confident than before.
But it wasn’t just brokers who were facing up to the fact that things around them weren’t quite as solid as they had previously thought. By the end of the year, homebuyers were feeling the heat too – according to Gallup, residential property ownership was at its lowest point in 50 years – and by year-end, it could be as low as 43%.
Here’s five trends that surprised us this year, and where we think things are heading next.
- Goodbye, Silos – Hello, Collaboration
When it comes to city living, we’re moving from “city” to “metro,” meaning the old silo model of economic development is rapidly becoming obsolete. In its place is a new one that emphasizes zoning integration and building community, rather than simply urban sprawl. In 2022, expect to see metropolitan governments working together to meet regional needs, rather than individual municipal entities competing for the best developments.
2.3D printing, drones and the internet of things will reshape how we build and interact with our homes.
The architecture and interior design industries will never be the same. 3D printing will become more commonplace and will allow for one-of-a-kind structures and interior design. According to Bloomberg, we could even see 3D printed homes in the next 10 years. Drones will enable quick (and inexpensive) home inspections, saving clients time and money. The Internet of Things (IoT) will take hold in the years ahead, allowing for smart homes that can automatically adjust to suit its residents’ needs.
Looking back on 2022, we’ll call today the ‘Year of the Drone’ in real estate. (Try not to think too hard about that.
3.Millennials as first-time homebuyers
The Millennial generation is set to drive significant change in the real estate market for years to come. According to one study conducted by realtors from Homes for Sale in Vancouver, Millennials will make up 48 percent of all homebuyers by 2024. As real estate professionals whose clients are typically Generation-Xers, it’s easy to forget the impact the Millennial generation will have on our industry.
- Market volatility will no longer be a deterrent for investors
What’s the first thing that comes to mind when you think of real estate? Is it things like hardwood floors, granite countertops and marble baths? For the most part, the answer is probably “yes.” However, there’s another side to real estate: one that involves investments and market volatility. And it’s not as scary as you might imagine.
5.Goodbye cash, hello real estate tokens
With the buying and selling of real estate happening increasingly online, property will become digitized assets that are traded using blockchain technology.
AI will play a growing role in real estate transactions in the coming years, and it even has the potential to make some brokers and agents obsolete. While 2021 was a good year for AI (artificial intelligence), with the growth of machine learning and advancements in computer vision, 2022 will likely be even better.
For example, imagine using an app to identify the best possible homes on the market at any given time that fit your needs, or using a chatbot for assistance with seller negotiations. Most importantly, imagine an AI that understands your needs and preferences more than you do — and is able to use that data to recommend the home of your dreams before you even know it exists.
Whether you’re an aspiring homebuyer or a seasoned real estate professional, the times they are in are changing — you’ll need to keep up to do business effectively in the future. Being prepared will help you get ahead of the curve and grow your business.
7.Connected consumers – By 2022, hundreds of millions of people will be connected via smart devices.
As smart technologies become more affordable and ubiquitous, connected consumers will expect everything to be connected, personalized and optimized to their preferences. This is true of many industries, but will be especially important in real estate.
One of the most important connected consumer trends is that the next generation of buyers and sellers will be connected consumers (over 80% of millennials). These connected consumers will expect all of their interactions with anyone in any industry to be personalized. They won’t be interested in engaging with brands who don’t get them or aren’t committed to understanding them.
8.Home prices will continue to rise — and that might be a good thing.
U.S. home prices will keep rising in the next five years, but there will be pockets of the country where it will be more difficult for buyers to find a home without overextending themselves. According to realtor.com®’s exclusive forecast of the real estate landscape in 2022, home prices will rise 4.6% across the country on average, but in some areas they’ll increase by close to 10%. That may be good news for homeowners who are looking to sell their houses and downsize, or move up to a bigger house, or move into a completely different area, but it’s bad news for buyers who are looking to enter the market.
Homebuyers’ chances of finding affordable housing will be limited in cities like Seattle (where home prices are forecast to increase 9%, on average) and Tampa (8%), while more affordable markets like Salt Lake City (1%) and New Orleans (2%) may offer better opportunities for entry-level buyers. It all depends on what’s nearby. Bigger cities with more amenities nearby tend to attract higher home prices than smaller cities with fewer amenities nearby.