The global proptech market size was reached at USD 30.16 billion in 2022 and it is expected to be worth around USD 133.05 billion by 2032, poised to grow at a CAGR of 16% over the forecast period from 2023 to 2032. North America had the largest market revenue of over 56% in 2022.
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In recent times, there are various industries using the technology for their better utilization and workflow. The term proptech (Property Technology) refers to the real-estate sector using multiple technologies for the management of real estate, buying, and selling properties. Proptech solutions utilize technology to fulfill the requirement of the property industry. Proptech is designed to analyze and connect the process of the real-estate which includes, sellers, buyers, tenants, landlords, etc. Proptech technology offers property clients to walk through the property by the use of virtual reality software and helps to make their decision. The proptech also allows the client to spitting rent payments and crowdfunding in the new real-estate project.
The growth of the global proptech market is attributed to the technological advancement in the real-estate sector and the rapid adoption of technology. Consumers are likely to shift their preferences towards convenient options while buying properties. The technology-based management of the property, quality visuals of property and the overall convenient process of investment in real-estate are few other factors to support the growth of proptech market in the upcoming period.
Opendoor Technologies, headquartered in San Francisco, United States is associated with selling properties via an online process. The company stated its annual revenue for the year 2022 to be $15,567 which has increased significantly as compared to the company’s revenue in 2021 which was estimated at $8,021.
There is not a second thought, that real estate is one of the fastest-growing sectors all over the world. And had a very significant amount of area of development in the near future. Information technology is also one the prominent part of several industries. The real estate sector also adopts technological advancements for better workflow and increase profitability in the market. Proptech is the property technology used for the overall management of overall participants of the real estate like buying, selling, renting, etc. the increase in the proptech market is due to its use of some of the trending technologies like artificial intelligence (AI), Machine Learning (ML), Virtual Reality (VR), and Internet of Things(IoT) in the real estate industry.
Artificial intelligence is used in the real estate industry for analyzing current advertising trends and providing actionable insights to clients. Proptech gives many benefits to the real estate industry, it lowers the cost of services the client can visit the property by virtually by the use of virtual reality. As a result, the price of the service is lower, and the profit increases. Proptech increases client convenience and reduce transactional cost. Thus there is a higher chance of the conversion of client interest into the deal which helps increase sales. These factors also affect the proptech market positively.
Big data analytics is also one of the prominent factors for the growth of the proptech market. Several organizations are inclined towards big data analytics technology to stay competitive in the market. Big data analytics benefits property investors by providing the best insights into the properties and understanding them to best invest in property selling and marketing.
Report Scope of the PropTech Market:
|Market Size in 2023||USD 34.99 Billion|
|Market Size by 2032||USD 133.05 Billion|
|Growth Rate from 2023 to 2032||CAGR of 16%|
|Largest Market||North America|
|Forecast Period||2023 to 2032|
|Segments Covered||By Property Type, By Commercial and Industrial, By Solution, By Deployment, and By End-User|
|Regions Covered||North America, Europe, Asia-Pacific, Latin America and Middle East & Africa|
Deployment of artificial intelligence (AI) in the real-estate sector
Artificial intelligence (AI) was first driven in the e-commerce industry, and after that, AI expanded its wings in all other sectors. Real estate is one of the significant examples of it. With real-time insights and results, artificial intelligence disrupted the marketing and sales illustration. In recent times, the realtor’s moving forward from traditional to AI (Artificial Intelligence) driven format. AI helps the industry to amplify sales and provide quality service to its clients. Artificial intelligence helps to analyze marketing expenses and to design marketing mix models. Artificial intelligence empowers the propTech market by offering advanced analytics, automation, personalization, and improved customer experiences.
AI streamlines multiple administrative tasks in real estate transactions, such as document processing, contract management, and other legal compliance. With the help of AI systems, real estate professionals can upgrade multiple insights to make informed decisions and optimize their investments. Considering such numerous advantages offered by AI for the real estate sector, the deployment of AI is observed to act as a driver for the market’s growth during the forecast period.
Slower adoption of technology in the real estate industry
The real estate is industry is traditionally been slow to adopt new technologies and new procedures. Professionals involved in the sector are observed to be resistant to such changes. The resistance restrains the widespread adoption of proptech solutions by slowing down the market’s growth. Implementing technologies often requires upfront investments, software/hardware training and infrastructural changes, that are difficult and may fluctuate the market for a while. The slower adoption of technology is observed as major restraint for the market’s growth.
IoT (Internet of Things) and smart building are the future prospects of the propTech market
Smart buildings and the Internet of Things are some of the future opportunities in the real estate industry. From routine maintenance tasks and finding the malfunction the automation will be seen in every property. With digitization, the smart building possesses a high-end security system. Artificial intelligence and virtual reality are simply driving the proptech market trends. Due to the digital transformation, the sales of the real estate have risen and due to this, there are higher market opportunities in the proptech market.
Property Type Insights:
The residential segment accounted for the largest market share in 2022. The residential segment is expected to increase during the forecast period due to the technological demand in the housing sector. The rising demand for smart homes, and digital gadgets for the residential sector. The increasing demand for digital open and closes the doors and windows in houses. Technological advancement in the real estate sector to buy the required houses.
The commercial and industrial segment is expected to witness a significant increase during the forecast period. The increasing commercial and industrial sector globally results in a higher demand for the proptech market in the commercial and industrial sectors. The growing urbanization and increasing need for office spaces and commercial sectors will likely to propel the demand of the proptech market.
The software segment held the largest market share in terms of revenue in 2022. The segment will continue its dominance due to the advantages of proptech solutions. The software segment allows property agents, managers, and brokers to sell their properties more efficiently and quickly. Proptech software solutions are used for a lot of purposes such as sales, operation, maintenance, contract management, etc. The software segment is also divided into property management, asset management, work order management, sales and order advertisement, customer relationship management, and others.
The Service segment also shows significant growth in the analyzed period. The service segment is divided into managed and professional services. Further, the professional segment increases due to the consulting, advisory, and portfolio analysis in the real estate industry.
The on-premise segments dominated the market of the propTech market in 2022. The on-premise continued its domination due to its providing customization to the business or industries as per their requirement.
The cloud-based segment is expected to grow at a noticeable rate during the forecast period. The rising use of cloud-based technology in the propTech market as it allows the access of data on any property from anywhere. The cloud-based technology stores data which can be useful for consumer question who are interested to buy the properties.
The housing segment is expected to show considerable market growth in the forecast period. The growth in the market due to the segment provides an easy solution for the township and apartments, performance and maintaining tenants and receiving payments.
The property managers/agents are anticipated to rise their market share in the analyzed period. The increase in the segment is due to infrastructural development and urbanization over the decade. It helps the managers and agencies to manage their work efficiently.
North America held the largest market share in terms of revenue generation in 2022. North America is known for its rapid adoption of technologies all over the world. The growing interest of the young generation towards real state will likely propel the propTech market in these regions. The rising infrastructural development in the countries like United States and Canada will expand its market share during the forecast period. Some of the major companies are investing in North America infrastructural development and in the rising technologies will boost the market demand near future.
Asia-Pacific showed significant growth in the propTech market in terms of the market size in 2022, the region will continue to grow at a noticeable rate during the forecast period. The growth is attributed due to the increasing infrastructural development in developing countries and rising demand for smart homes, smart corporate buildings in the countries like India, China, and Japan will be the highly appreciated growth factor for the propTech market in this region. Moreover, the rising construction activities in the developing countries of Asia Pacific along with the governments focusing on infrastructural development are expected to fuel the market’s growth in the region.
Middle-East and Africa are expected to witness a significant increase over the anticipated period. The increasing investment from the government and private authorities for infrastructural development attracts the tourism sector there is a higher demand for technological advancement in real estate which propels the demand for the propTech market.
Kay Market Players:
Segments Covered in the Report:
By Property Type
By Commercial and Industrial
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