3 Ways Technology is Changing the Real Estate Industry 

People invest in real estate for a plethora of reasons, namely, a stable source of income, its ability to act as a hedge against inflation, diversification in the investment portfolio, and various tax benefits, such as tax deductions. Let's delve into the three key ways technology transforms the real estate sector and which states you should consider investing in.

Impact of Technology on the Real Estate Industry

Tech is revolutionizing the real estate industry in various ways:

1.   Digital Twins

Digital Twins allows you to study and explore properties using online-generated data, such as from sensors and loT (Internet of Things). It helps create the property’s 3D model and show all its features, predict how it will hold up during any natural disaster, and create fire evacuation plans.

2.   ML and AI Technologies

Machine learning and Artificial intelligence technologies allow you to predict market trends, collect and analyze real estate data to evaluate property value, and decorate properties. AI can make accurate predictions about consumer behavior, mortgage rates, and real estate prices, allowing real estate agents to make more informed decisions by taking advantage of market trends.

AI can also help you customize the property’s interior design to suit potential buyers' preferences, such as by asking about their preferred styles and colors. This ultimately creates a more personalized experience and increases the chances of successful closings and sales. It can also help improve property search efficiency, and virtual assistants or AI-powered chatbots can schedule appointments, handle routine inquiries, and provide information about listings.

3.   Blockchain Technology

While Blockchain technology is more commonly known for its role in cryptocurrency, it can provide efficiency, transparency, and security to transactions in real estate. Here are some ways blockchain technology can be applied in the industry:

• FERMs, or Fractions of Real Estate Management, enable you to own a fraction of the property by breaking property ownership down into smaller portions. This allows multiple people to invest in the same real estate.
• Tokenization: Here, cryptocurrency stores assets on the blockchain after dividing them into tokens, helping with asset liquidity.
• Smart contracts can speed up property verification, acquisition, and search processes.

Best Places to Invest in Real Estate

These are a few examples of US states you can consider investing in.

1.   Austin

There are several reasons to invest in Austin real estate, one being that it's ranked one of the best places to invest in Texas. Its economy and stable job market encourage start-up companies and entrepreneurs and draw many employees, which boosts property value. Austin offers a diverse range of rental properties to invest in, such as condos, apartments, or single-family homes. Austin's home prices have fallen by 11%, and rent has declined by 7%.

Austin is often called "Silicon Hills" due to its flourishing tech industry. Many leading tech firms, like Dell, IBM, and Oracle, have a presence in the city, attracting young, well-paid professionals who often rent or buy homes, contributing to the demand for housing in the city.

2.   South Carolina

Along the Atlantic Ocean coastline and with a mild climate, South Carolina is an ideal state for investment. Compared to other states, it’s more affordable, as the typical home value remained at $284,000 in 2023. The cost of living is also below the national average, and the state has a favorable property tax rate, making for better returns on investment.

3.   Boise

Boise, Idaho's capital city, has affordable housing, a strong job market, stable real estate, a growing population, low property taxes, and more, making it ideal for real estate investment. Its strong healthcare, education, and technology job market attracts talent and residents, significantly increasing property value and housing demand.

Endnote

Technology is changing the real estate industry through the adoption of blockchain technology, ML and AI technologies, Digital Twins, and more. These can all help promote transparency, increase efficiency, and provide investors with access to a vast amount of real estate data.