As we look back across 2021, some of the biggest stories in real estate have been closely tied to technology. From the proliferation of PropTech to major acquisitions and consolidations to Zillow iBuyer saga and more, tech and real estate have overlapped in numerous and surprising ways.
Zillow’s $500 million acquisition of the extremely popular platform ShowingTime was one of the biggest real estate stories. In addition to further cementing Zillow’s image as an industry disruptor, the acquisition also fueled or accelerated the development of a host of showing related PropTech to fill the vacuum. From Instashowing to Showingly to ShowingSmart, there are now many more options available than there were just one year ago.
It’s not just Zillow that has sought to expand its tech presence and capabilities.It seems like all of the biggest players in real estate either made acquisitions of tech companies, developed their own proprietary tech, or both over the last year.
Going into 2022, it looks like even the MetaVerse may become the latest frontier of the real estate world. This more than anything highlights the at times blurry relationship that has developed between technology and real estate over the last year.
And of course, one of the biggest stories of the last few months and indeed all of 2021 has been the precipitous fall of Zillow Offers. The Zillow Group went all in on their iBuyer program, before being forced to shut it down in the fourth quarter this year after sustaining huge losses on most of the homes they acquired through it. The shuttering of Zillow Offers cast some doubt on the overall viability of iBuyers as well as the effectiveness of Zillow’s proprietary Zestimate to accurately assess the value of properties.
The Zillow Offers saga in particular highlights an important point about the role of tech in real estate in general. Residential real estate is still about the fundamentals, about people, relationships, and the local.
Tech is a great way to achieve leverage and improve your lead generation, marketing, and listings. It is also quite likely that all of the money being poured into real estate tech right now will result in some massive changes in how the business is done over the next few years. But it is still fallible and can’t replace genuine knowledge of neighborhoods and the people who live in them.