Technology and Real Estate Affordability

Technology and Real Estate Affordability

Technology has become an essential part of real estate. The ability to access information through the internet and mobile devices has changed the way people do business and conduct transactions. This is true for both buyers and sellers, who want to be able to make decisions based on the latest market data.

The impact of technology on real estate affordability is already being felt by many homeowners across the country. There have been many studies done over the years that show how technology can help lower your mortgage payments or help you save money by paying less interest on your loan. 

Technology Companies Addressing Housing Affordability Crisis:

Affordable homes are being built faster and in more efficient ways with innovative technologies such as modular homes and ADUs. The construction industry is increasingly using automation to improve efficiencies and reduce costs. And now with advances in artificial intelligence (AI), we’re seeing how this technology can be used for both residential and commercial properties alike. Technology is an integral part of communicating and giving people the power to excel in their lives. Whether it is connecting with friends and family on social apps, banking, video conferencing, shopping or finding a home, technology is critical and provides increased accessibility through its use. With construction costs increasing, inflation rising, median home prices at an all-time high, 

Technology and Risk Prediction in Real Estate:

1) AI and Blockchain

It is possible to use artificial intelligence to improve risk prediction methods. For example, a machine could be trained to identify trends in bankruptcy filings by using a dataset of all bankruptcy filers for the past 10 years. This dataset would include information about each borrower’s age, income, debt level, and credit history. The trained machine could then predict whether a person would default on their mortgage by looking at things like age and income.

2) Data collection

Blockchain entrepreneurs are now working to build networks of payment information that capture more categories of recurring payments, all of which may predict a borrower’s future ability and willingness to repay. Although some traditional players in the credit score ecosystem are doing this to some extent, such as FICO with their XD product, which includes telecommunications payments, the current system does not holistically incorporate these other payments into its models.

The blockchain is a new technology that has the potential to revolutionize the real estate industry. Blockchain technology has the ability to create new ways of doing business, including:

• Reducing fraud and errors in loan origination and servicing;

• Improving customer experience through data transparency;

• Streamlining the process of selling or managing assets through tokenization

• Reducing capital requirements through smart contracts.

The Impact of Technology on Real Estate: Virtual Tours, AI, and Data Analytics

The real estate industry is now a technology-driven one. Technology has given a major boost to the sector when stepping out was not an option and social distancing was imperative. Since physical site visits are not possible—in fact, unsafe for both the parties—several realty players are taking the digital route to continue serving their customers and ensure continuity in sales.

Virtual reality (VR) tours, artificial intelligence, and data analytics, among others, are some of the advancements that players in this space are effectively leveraging.

Buyers don't have to take out multiple days to scan properties and shortlist the ones that best suit their interests. Instead, they can take virtual tours from the comfort of their homes and get a 360-degree view of both interiors as well as exteriors, including decor, fixtures, restroom fittings, etc. As prospective buyers get familiarized with this new process, they have started shortlisting and transacting even during these unprecedented times.

This does not only affect home buyers but also developers who have been traditionally slow adopters of technology-driven processes such as online payment options or online registration forms for property listings. Most developers still prefer paper transactions with cash payments; however, with technology at hand they can now offer digitized contracts and documentation with SAAS based property management systems like Relata. 

Technology has been an important factor in the evolution of real estate. Since its inception, technology has become a key tool used by real estate professionals to manage their business. Technology has also helped transform the way we buy and sell homes.

Technology has been a game changer for real estate investors as well. It can help investors reduce overhead costs and increase their portfolio returns by taking advantage of new technologies that offer more efficiency and transparency.

Its benefits go beyond just making life easier for home buyers and sellers. The impact of technology on real estate is far-reaching and wide-ranging, impacting all aspects of the industry from design and construction to finance and marketing.

To achieve broader affordable or attainable housing, leaders across the country must join forces. This includes everyone who can have an impact and advocate for laws and policies designed to increase access to housing opportunities. We need elected officials, investors, developers, PropTech partners, associations and industry practitioners to help remove legal, regulatory and systemic barriers that prevent access to fair and affordable housing.

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