Market Trends of Global IT Industry in Real Estate
This section covers the major market trends shaping the Real Estate IT Market according to our research experts:
Cloud Type of Deployment is Expected to Account for a Significant Share
- Digital transformation has created an increasing demand for connectivity. The explosion of Big Data with the Internet of Things (IoT) and constant technological innovations to efficiently manage the complex real estate portfolio require simply connected IT solutions. The deployment of these solutions on premise requires different servers to be purchased for different solutions, which not only adds to the redundancy but also leads to the requirement for additional employment, increasing the cost-to-completion of the project.
- Thus, with a cloud-based solution, such as SAP Cloud for Real Estate, facility managers and lease administrators can manage real estate lease agreements, with all payment and valuation postings being recorded in real-time within SAP S/4HANA, providing real estate vendors with a holistic solution to manage operations without additional infrastructure and employment costs.
- The stakeholders in the real estate industry are highly reliant on physical paperwork and are required to carry the documentation on the go. At the same time, employees can access their digital library of files while on premises (unless the company has not digitized its records), but realtors are weighed down by this problem when away from the office.
- In May 2022, Sage, an accounting, financial, HR, and payroll technology for small and medium-sized businesses (SMBs) provider, announced the launch of Sage Intacct Real Estate, a new module that adds property management functionality to the Sage Intacct cloud financial management system. The solution combines the Sage 300 Construction and Real Estate (CRE) Property Management with Sage Intacct's multi-tenant cloud platform.
- The Indian market is witnessing an increase in demand for the real estate industry. According to IBEF, the market size of the real estate industry in India was valued at around USD 120 billion in 2017. It is estimated to reach USD 650 billion by 2025. In 2022, over USD 2.5 billion worth of investments were estimated in this sector across the country.
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North America is Expected to Account for the Largest Share
- The real estate industry in North America seems to be on an accelerating disruption curve, highlighted by rapid changes in tenant dynamics, customer demographic shifts, and ever-increasing needs for better and faster data access to allow improved service and amenities.
- In the United States, investor sentiment related to real estate remains positive but has weakened over the past year, owing to uncertainty over economic policy and rising interest rates.
- According to the US Census Bureau, it is projected that real estate and rental and leasing revenue in the United States would amount to approximately USD 786.4 billion by 2024. Traditionally, the residential sector has been known to be the quickest adopter of IT.
- In July 2021, Salesforce announced the acquisition of Slack Technologies Inc. Together, Salesforce and Slack would create the Slack-first Customer 360, a single platform for connecting staff, clients, and partners with one another and the daily-use apps they utilize, all inside their current processes.
- Various emerging startups are establishing their business in the real estate technology market in the United States. For instance, New York-based property technology startup Facilio has raised USD 35 million in its latest funding round as the company aims to expand and enhance its technology. This investment would allow the company to expand its sales and marketing and enable more companies to reach success through a predictive, connected model of real estate operations.
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