Proptech Trends for 2023 that Will Have a Lasting Impact

According to the Global Proptech Market 2022 research report, the Proptech market size is expected to expand at a CAGR of 17.05% during the forecast period (2022–2027), reaching USD 45000.0 million by 2027.

Proptech has been introducing new trends and innovations every year since its inception. Following Proptech trends means leaving behind old approaches to selling property and implementing real estate software development solutions to business.

As Deloitte states, property value is not defined solely by the location, amenities, and size but by how brokerages and companies blend technologies with their services to enable superior tenant/buyer experience.

The Proptech industry constantly expands its value, and its new tech solutions shape the behavior of industry players.

Let’s explore what 2023 has in store for Proptech software development and what changes Proptech trends will bring to residential and commercial real estate industries.

The Metaverse: Creating Virtual Real Estate

The Metaverse is a digital reality where people can socialize, work, play, and transact. It is also a promising business platform. Real estate companies buy, sell, develop, and rent property assets to others in virtual reality.

The Metaverse is an ongoing topic: some investors find investing risky, while others see significant investment opportunities. In 2021 the global metaverse real estate market was valued at $821.9 million, with a projected increase to $5.95 billion by 2028.

The growth of Metaverse is supported by developments and investments in other Proptech trends like VR, AR, and blockchain technology, which we’ll discuss in the following passages.

Blockchain

Disruptive blockchain technology is affecting many industries, and the real estate market leads in its acquisition.

Blockchain provides an independent, verifiable and trustworthy record of events/transactions.

In 2023 the value of blockchain will increase as more and more people get involved. Investors use blockchain for fractional property investment and brokers for utilizing smart contracts, while for buyers, blockchains provide a clear and undisputed history of a property and its ownership.

Due to the high market share and investments, blockchain will be one of the most promising Proptech trends in 2023.

Augmented Reality (AR) and Virtual Reality (VR)

Even though AR and VR aren’t a new trend, during the COVID pandemic, these technologies helped brokerages to survive.

AR is a technology that integrates digital sensory elements into an existing environment by placing new information over it.

Virtual reality (VR) is a 3D computer-generated environment that depicts a real or an imaginary world in combination with realistic sounds, imagery, and other sensations felt through headsets, glasses, helmets, gloves, etc.

In residential and commercial real estate, AR and VR can be used to get a 3D walkthrough and tours of prospective properties and 360-degree walking indoors and outdoors.

AR/VR technology implementation improves customer experiences and boosts sales. According to a Matterport survey, listings with 3D virtual walkthroughs close 31% faster and sell up to 9% more.

Quantum Computing AI

We expect to see this newly emerging Proptech trend in residential and commercial real estate. Analytics Insight states that the global quantum computing market will expand from $470 million in 2021 to $1,765 million in 2026.

Even though the real estate industry is slowly adopting quantum computing, the forecast of this process is optimistic. In the next few years, we expect more Proptech startups and companies to apply quantum computing in their algorithms.

Cloud Computing and Storage

As real estate businesses looking for ways to ensure high business scalability and secure data storage, migrating to the cloud is a great solution.

The idea behind cloud migration is to let brokerages and companies store their data about clients and properties online without managing onsite data centers.

For real estate agents, property owners, and brokers, migration to the cloud mainly comes in the form of subscription-based applications (SaaS apps). Among the most important benefits of cloud computing for real estate are:

• Accessibility. As all data is stored in the cloud, real estate professionals can access information from anywhere and on any device.
• Paperless. Implementing cloud computing and storage enables real estate firms to cut down the use of paper, leading to better control over documents.
• Scalability. The faster your real estate company grows, the more data it needs to store. Cloud storage is a flexible and scalable solution you don’t need to set up from scratch. Change the subscription plan and scale your cloud storage along with your business.
• Security. Most cloud computing environments like Microsoft Azure, Google, and AWS take care of many security issues to protect you from hacking such as data and identity theft, unauthorized access, intrusions, and unsolicited traffic avoidance.

Robotic Process Automation (RPA)

Automation of business processes is the key to success. But what if we say that one of the most promising Proptech trends in 2023 will be Robotic Process Automation (RPA)?

RPA is a form of business process automation that allows anyone to define a set of instructions for a robot or ‘bot’ to perform. In other words, RPA is any software that automates manual, repetitive processes and tasks.

In the real estate industry, RPA is used in the back-office, e.g., the generation of brochures and invoices, management of payments, renewals and credit applications, multi-tenancy risk control, and more.

The general potential of RPA as Proptech trends in 2023 is illustrated in the following graph:

Data Analytics in CRMs

Being players in the offline-first industry, real estate companies get used to processing deals and making decisions based on analyzing data stored in Excel spreadsheets and professional experience.

Today, real estate companies perform big data analytics using data management software like Salesforce.

According to the 2022 Commercial Outlook by Deloitte, 70% of respondents agree that data analytics performed in CRMs provides advanced forecasting and scenario planning.

One of the best CRMs for advanced data analytics is Salesforce. It pulls all information and packs it into insightful dashboards right at your fingertips.

Before migrating data to Salesforce, real estate professionals should ensure their data is groomed and formatted.

Smart Buildings Powered by Internet of Technologies (IoT)

The Internet of Things (IoT) refers to the network of smart devices communicating with other internet-powered technology through the cloud.

IoT-enabled property or smart buildings became a Proptech trend a few years ago and continues to strengthen its position in the list of Proptech trends in 2023 that will have a lasting impact on the industry.

The dynamic expectations of tenants and buyers are met with always-connected IoT homes of smart mirrors, robot vacuum cleaners, and wireless kitchen appliances interacting with each other and quickly reacting to people’s needs.

Green Building Technology

Sustainable energy consumption accomplished by the increased demand for digital systems that track and improve energy use, add green building technology to the list of Proptech trends in 2023.

Manufacturers and installers that wisely pair green building technology with the above-mentioned proptech trend of smart homes, can significantly decrease the carbon footprint of construction projects.

And first enthusiasts who embrace green engineering and performance-management tools that support retrofitting will likely see big revenue soon.

Conclusion

As you can see, 2023 promises to be an exciting year for Proptech market, as both residential and commercial real estate industries continue to adopt more technological solutions needed to stay resilient for the current changes and challenges to come.