4 Reasons Why Real Estate Firms Are Slow to Tech Adoption

Why Tech Adoption Matters

Real estate is a trillion-dollar industry, employing millions of people around the globe. And yet, despite its size and importance, it’s notorious for being hesitant to adopt new technologies. According to a recent survey of real estate leadership positions in firms collectively responsible for over 60% of all real estate transactions in 2022, 39% of respondents said agent adoption of new technologies was one of their top five challenges in 2023. 

Here’s a look at some of the reasons why. 

1. Tradition

The real estate industry is rooted in tradition, which can make it resistant to change. 

However, post-COVID trends have shown that while real estate has faced significant market disruption and increased competition, the advent of increasingly savvy home buyers and sellers has actually helped propel tech innovation in the sector. This has prompted strategic agents and firms to start leveraging tech for business benefits, as well as start detaching from legacy business practices, in order to better serve their clients. 

According to a 2022 Deloitte survey of 450 decision makers in top CRE companies, nearly 50% of respondents in Asia/Pacific and North America see benefits that proptechs can bring, and over 43% of respondents identify process automation as their top target capability for proptechs, followed by 35% who look for marketplace data and analytics. 

2. Company Size

The industry is dominated by small firms, which are less likely to invest in new technologies. 

Smaller firms tend to have smaller budgets and strong attachments to legacy processes, but 2023 is revealing that even small firms can benefit from adapting and evolving along with tech, that can scale alongside their needs and specific business goals. Tech can help improve efficiencies, enhance customer relations and actually reduce costs wherever automation is applied. 

Real estate tech doesn’t mean having to break the bank, and emerging technologies are offering a wider array of services that can cater to firms of all sizes. In fact, 2022 survey respondents from real estate firms of ALL sizes pointed to increasing outsourcing capabilities to optimize operational capacities. Of particular interest are back-office functions, where risk management and internal audit, property management, and tax accounting and reporting were most often cited by survey respondents. 

3. Perceived Costs

Possibly the biggest reason as to why firms are hesitant to adopt more tech, is a concern over the cost. 

Yes, it is true that many technologies can come with a hefty price tag; not only are startup costs common, but many technologies require regular maintenance in the form of updates, follow-up subscription fees and additional tech support. Couple that with limited budgets and the frequent need to train agents and other team members to learn how to use the software, and you’ve got more reasons as to why real estate players are so hesitant to include new technologies into the mix. 

However, best-in-class firms are able to carefully weigh up their options and consider what the return on their investment would look like with certain proptech solutions being added into their business components. For many, the benefits of automating countless manual processes offer huge dividends just in the amount of time saved, as well as reducing human errors, while freeing up agents to be more strategic with their time and doing more customer-facing work. 

17% of survey respondents say their companies plan to increase their 2023 tech budgets by 5% or more. These results reveal that the top areas of tech investment are to drive revenue through customer relationship management and property operations management. 

4. We Don’t Need It

A perceived (mis)understanding that they don’t need new tech to run an already successful business.

Many real estate firms feel that they don’t need constant tech upgrades in the long term, and would rather prefer tried and tested ‘old school’ methods, soothed with the perception that real estate, after all, is all about contacts and relationship building. Nevertheless, the reality is that technology isn’t becoming a part of real estate, it already has become an integral part of the industry, and those who remain resistant to change risk falling further behind competitors, as well as lacking the tools and resources that could help them better serve their clients’ changing needs. By not utilizing new technologies, it’s inevitable that firms may continue to miss out on opportunities to help streamline their processes and ultimately increase profitability.

Realforce. The all-in-one marketing platform, designed specifically for real estate. 

In 2023 and moving forward, technology is not a place where the real estate industry should be cutting back on spending. At Realforce, we understand implicitly that firms don’t want to be left behind, but sometimes the struggle becomes all too real when balancing a company’s existing flexibility, with a healthy appetite for risk, particularly in the case of implementing new tech. Upsetting the status quo in the interests of potential improvement is a brave step, particularly in current environments. That’s why we’ve created an all-encompassing marketing platform that addresses the very real fears and risks that real estate firms face every day when it comes to tech adoption. 

We know that an industry-specific solution can make a pivotal difference when it comes to exploring how technology can unlock potential, and achieve better efficiency in the long term. 

With Realforce, (formerly Adfenix) firms can: 

• Make informed, innovative plans to meet the evolving needs of their customers, leading with smart implementation that keeps marketing operations running smoothly and efficiently. 
• Unlock additional value through strategic workflows and enhanced data capabilities that are leaps and bounds ahead of the competition. 
• Continue market consolidation that is led by an easy-to-use tech platform, specifically built for end-to-end real estate marketing processes. 
• Equip a high-performing team of agents and marketing professionals who can now create and experience entirely streamlined workflows wherever they see fit, (a ‘build as you need’ model, if you will), saving time and money in the process. 
• Embrace, not fear, tech adoption that is easy to use, scalable, customizable, and a truly strategic investment designed to fuel a more profitable pipeline.

Find out why one of our clients says the adoption rate for their agents has skyrocketed to 90% in this short testimonial video.  

For the first time, firms can rest assured knowing that they can finally work with a solution that is easily tailored to fit in with existing workflows, so no one has to ‘start from scratch’ if they don’t want to. More importantly, all the risks and issues that so often come with new adoptions can be mitigated, because Realforce has got real estate firms covered, from marketing strategies to entire campaigns, ensuring long-term success that really proves investment value in the long run. 

Find out why one of our clients says the adoption rate for their agents has skyrocketed to 90% in this short testimonial video.