Key benefits and challenges in real estate software development

Real estate software development is the foundation of the industry’s digital transformation, which we have witnessed in recent years. Proptech solutions transformed key aspects of buying, renting, and managing properties. With modern digital solutions, real estate professionals can easily streamline numerous business processes and automate routine tasks. With a great variety of real estate software solutions available, there is still a demand for custom software that caters to organizations’ specific needs and requirements. In this saturated market, in order to stay competitive, real estate companies offer excellent user experience and use innovative technologies to succeed. Now is the best time to learn about the custom software development process, its advantages, challenges, and emerging trends.

About custom real estate software development

Custom real estate software development is the process of building digital solutions for real estate businesses from scratch or upgrading existing solutions. Unlike off-the-shelf solutions, custom software can be tailored to align with a company’s needs, business goals, and IT ecosystem. Building custom real estate solutions requires at least three months and $100.000. These costs include hiring a development team, establishing a development environment, investing in tools and hardware, and more. The frame and budget can vary based on the number and complexity of features, technology stack, type of software, and real estate development team structure.

Types of real estate software development solutions

There are dozens of different real estate applications used by industry professionals today. Some are rather niche, and some are used by almost every organization daily. Here are the most common types of real estate software solutions:

• CRM (customer relationship management) systems. Real estate CRM software is instrumental in ensuring effective communication and managing the sales pipeline. CRM systems help real estate professionals centralize data, track leads, automate marketing tasks, and manage customer data.

• Real estate marketplaces. This type of software is usually developed by real estate firms to showcase their offerings, but there are also marketplaces that aggregate properties from different companies. Real estate marketplaces feature property listings, search functionalities, payment tools, and estimation tools and often integrate map services and multiple listing services.

• Property management software. These systems assist real estate industry professionals in industrial, residential, and commercial property management. Property management tools can be used for handling lease agreements and rent collection, tenant screening, managing multiple properties at once, scheduling and tracking maintenance, and more tasks that property management companies handle on a day-to-day basis.

• Data analytics platforms. These software solutions help real estate professionals collect and analyze data to make more informed decisions about investments, property prices, and other aspects of business. Real estate development analysis software usually includes estimation tools, AI and machine learning integrations, data visualization solutions, and third-party integrations.

• ERP software. Real estate ERP software can be used for a wide range of tasks, such as project management, sales activities, accounting operations, marketing activities, regulatory compliance, and supply chain management.

Understanding the types of real estate development solutions is crucial for developing your own custom software. Now, let’s talk about the key advantages of building custom applications and the reasons for investing in real estate software development services.

Benefits of custom software development for the real estate industry

Creating custom software is a complex process. You need to hire an in-house tech team or invest in real estate software development services, spend dozens of thousands of dollars, and wait for at least several months until launch. However, it is often worth it as custom solutions offer businesses numerous benefits, and here are some of the key ones.

• Customization capabilities. With off-the-shelf solutions, you get a limited number of features chosen by a third-party provider who doesn’t know your business and its specific needs. Custom real estate software provides you with unlimited customization possibilities and the ability to create an application that will perfectly align with your workflows and business logic.

• Increased scalability. Real estate industry experiences steady growth and in the near future you will probably achieve a point at which third-party software you are using can no longer provide the capabilities for efficient operations. Instead of changing off-the-shelf solutions everytime your business scales back and forth, you can build a tailored application with scalable architecture.

• Data security. Proptech solutions often handle a lot of sensitive user data, including financial records and personal information. Data security is a serious concern for real estate businesses, and custom apps allow companies to implement robust security measures, use the latest methodologies, conduct audits at any time, easily review source code, and ensure compliance with various regulations and data protection laws.

• Competitive advantage. In the saturated proptech market, real estate apps need to provide excellent user experience to gain a competitive advantage. Custom solutions allow companies to offer higher personalization, advanced search functionalities, cutting-edge technology integrations, such as VR/AR tours or AI-based chatbots, and other features that off-the-shelf software often lacks.

• Cost-effectiveness. Hiring real estate developers initially is more costly than investing in third-party solutions, but in the long run, tailored products often become more cost-efficient. Elimination of recurring license fees improved productivity and operational efficiency, reduced need for additional software, enhanced scalability, and other factors lead to cost savings and income growth over time.

Now, let’s talk about the challenges that developers of software for real estate face and ways to efficiently overcome them. 

Key real estate software development challenges

In order to build the best real estate development software, you need to understand challenges that may arise so you can quickly mitigate them. Here are the most common challenges in creating custom proptech solutions.

• Complex requirements. The real estate industry has a lot of specific requirements, unique customer demands, and other aspects that software developers need to navigate to build solutions that will properly align with their client’s business needs. To avoid such issues, hire tech experts with relevant experience. For example, for building a multiple listing service, invest in MLS software development services with a proven track record and industry expertise.

• Regulatory compliance. Fully understanding various complexities of national, international, and industry-wide regulations and frameworks is a real challenge. Failure to ensure compliance can easily lead to legal issues, monetary fines, and permanent damage to the company’s reputation. To avoid these repercussions, invest in top software development services for real estate with great expertise in numerous regulations. Also, conduct regular compliance checks and collaborate with legal experts.

• Emerging technologies integration. No matter what you build, real estate development accounting software or a simple company website, you will want to add emerging technologies into your solution. Such technologies as AI, machine learning, blockchain, the Internet of Things, and virtual reality evolve quickly. Real estate software developers can find it difficult to keep up with updates and best practices, integration with existing systems can be problematic, and skill gaps in your tech team may require hiring or training additional IT professionals. To avoid these challenges, implement only technologies you are absolutely sure of, conduct testing before deploying new features, and use an interactive approach to development.

• Cost management. Balancing quality and costs and allocating resources for all phases of the development process is a real challenge, especially for people without previous experience. Also, hidden costs like third-party integrations, unforeseen tech issues, or post-launch maintenance can impact the final budget. To manage the budget more effectively you can use project management software and Agile development methodology. Adopting an MVP development approach will allow you to minimize initial costs while building a strong foundation for your application.

In order to create a custom real estate app, you need to be aware of possible challenges. Following technology trends closely enables you to build software that will provide the best user experience possible and help your business grow.

Software development trends in real estate

Learning about emerging technology trends and the ways they can improve your business operations is crucial for gaining advantage in this competitive and saturated industry.

• Artificial intelligence and machine learning. AI and ML have changed numerous aspects of the real estate industry. These technologies are used in almost any solution, from custom real estate CRM software development to property management systems. AI-powered chatbots improve customer support, data analytics tools lead to better decision-making, and machine learning algorithms enhance estimation tools. Open-source AI frameworks, APIs for easier integrations, and advancements in generative models will ensure that even more real estate businesses adopt these technologies in the near future.

• Blockchain technology. Real estate industry involves a lot of financial transactions, document management, and exchanges of personal information . Blockchain enables real estate firms to streamline transactions, increase transparency and security, and improve operational efficiency. Smart contracts assets tokenization, and blockchain-powered land registries are quickly gaining traction in real estate software development. In the future, we will see more applications leveraging this technology.

• Virtual and augmented reality. VR and AR technologies allow potential buyers and renters to take immersive 3D tours of properties from anywhere in the world, transforming real estate operations. However, these technologies are featured more widely in the real estate industry than it may seem. Virtual reality is used for employee training, consumer education programs, real-time interactions between agents and clients, and in software for property developers and construction industry professionals. Virtual and augmented reality are not all about interactive entertainment today, and these technologies will continue to play a key role in real estate operations.

• Internet of Things. IoT integrations are one of the most transformative trends in real estate today. Smart sensors and devices play an essential role in residential property management, enabling companies to implement proactive maintenance, efficient energy usage, and increased security measures. Also, today, many buyers prefer smart homes with IoT integrations. In the next few years, we will witness more smart homes being built and older properties augmented with Internet of Things sensors and devices. 

• Cloud computing. Cloud-based software is revolutionizing the real estate industry. Real estate project management software, CRM systems, virtual tours software, online listing platforms, and more digital tools can now be accessed from anywhere through cloud storage. Companies that invested earlier in web and mobile app development for accessibility and flexibility now build cloud-based solutions. With advancements in cloud computing and the growing popularity of the SaaS business model, we will see more real estate companies embracing cloud technologies.

Conclusion

Proptech solutions transformed numerous aspects of buying, renting, and managing properties. There are countless off-the-shelf solutions available today, but custom apps offer unmatched benefits and can be tailored according to your specific needs and requirements. The custom software development process can be challenging, but with knowledge about possible challenges and a reliable real estate software development company as your tech partner, you can build your own digital solution that will help you to stay ahead of the competition.