An astounding $1.5 billion was reportedly invested in the real estate tech firms coming from a various pool of investors. Other firms that would not commonly invest in real estate tech are now making their way in the industry. But why does technology pose a good investment in the real estate market?
According to the report from The Real Deal, many companies started using technology platforms in their businesses. For example, The LeFraks put their investment in residential brokerage compass. Rudin Management has also joined in the trend in 2013 by venturing in the real estate tech world. Other real estate families invested in technology that is useful and applicable in their daily life.
Josh Guttman in his article "The impending opportunity in real estate technology" suggests that this trend in real estate investment will continue to rise. Venture funds in 2014 invested $605 million compared to $241 million in 2013 posing more than twice of growth. There are also many signs including the niche status of real estate tech investing now moving to a category which gains broad attention. Also, there are a lot of opportunities to innovate with the use of technology. For example, there are companies offering software to property owners so they can easily oversee and track their assets.
According to Worldwide ERC, the Internet technology has reshaped how consumers get the latest news and information about the real estate market. The next big thing might be the use of mobile phones to access which is, in itself, as impactful as the Internet. More and more brokerages developed mobile versions of their real estate websites and now a number of companies are creating mobile apps for that specific purpose.
Although many companies do not want to be the last in this latest trend to be technologically adept, still many are joining in the wagon, taking the risks involved.
