VR/AR Set To Disrupt Real Estate Sector
PropTech is helping modernise the real estate sector, with Virtual and Augmented Reality (VR and AR) leading the way. According to Goldman Sachs, VR/ AR is predicted to become an $80 bn market by 2025, with $2.6 bn in real estate. It’s no surprise that Luxembourg, with a booming real estate market, is seeing innovation in this space emerge.
Photo: Mathias Keune, Founder of Beyondo / Image Credits: Kaori Anne Jolliffe / Silicon Luxembourg
The use of VR and AR within real estate, property management and living sectors has been increasing for some time, as both provide opportunities for cost efficiency and time saving. However, it’s important to distinguish between the two technologies, as each is transforming the industry in different ways.
Applications of VR and AR differ
VR is a completely immersive experience that places the user in an entirely digital space, usually through virtual-reality goggles and 360-degree videos. One local project making use of this type of technology is Beyondo. They use VR to enable architects to visualise projects in the design phase, and to help developers sell property off-plan or gain extra investment. According to Founder, Mathias Keune, “Real estate solutions based on VR technology are not only beneficial to consumers, but also help brokers grow their business and maximise clients and revenue.”
“We believe that the Luxembourgish ecosystem has big potential”
AR, on the other hand, incorporates more realistic elements in the overall experience. It generally uses a smartphone or camera to produce a live view of an area that is then altered to include digital elements. Luxembourg-based GAMMA Technologies use their AR product to overlay 3D Building Information Models (BIM) onto locations in real-time. According to GAMMA’s Head of Marketing and Communication, Laura Bocchibianchi, AR can “prevent errors, reduce rework and shorten the time spent on documentation and follow up which allows savings of up to 10% of total construction costs.”
Numerous benefits for real estate
And the benefits of VR and AR go beyond cost efficiencies and timesaving. At the design and construction phase of a project, AR can improve communication, helping to track the construction progress on a building-component-specific-level for precise progress reports. It can also help to catch potential errors in the build before they happen by visualising BIM models onsite.
Further down the property chain, VR can help enhance the customer experience when it comes to purchasing property. As mentioned, Beyondo is already using this technology with developers to sell off-plan property. However it can also support the sale of existing property by offering global reach. Because users can virtually tour properties from anywhere in the world, real estate professionals are no longer limited to a local audience. This functionality became increasingly important during lockdowns and travel restrictions caused by the pandemic.
VR and AR also enables buyers to go one-step beyond viewing properties, allowing them to customise properties to their own taste, or visualise how their own furniture would look in the space. Providing a personalised experience for buyers can make a purchase more attractive. For unfinished buildings, and “fixer-uppers”, VR and AR can also be used to help simulate how the end result could look.
“Real estate solutions based on VR technology are not only beneficial to consumers, but also help brokers grow their business and maximise clients and revenue.”
Adoption of PropTech in Luxembourg is slowly moving forward
When it comes to the adoption of this type of PropTech within Luxembourg, there are plenty of opportunities. The implementation of BIM technology is increasing, and the impact that VR and AR could have on optimising investment in this space is becoming known. According to Bocchibianchi, “the possibilities to leverage more efficiencies using AR technologies result in buildings and facilities with higher quality in a shorter time to build. This will put the competitive advantage of these technologies into the hands of more digitised companies.”
However, according to Keune,“…there is still a great deal of doubt in adopting new technologies in the real estate market.” Given the competitiveness of the property market in Luxembourg, investment in customer service and sales enablement technology is not a priority. And when it comes to educating stakeholders about how technology can optimise different business areas, Luxembourg is still catching up with its neighbours. Despite this though, Keune does see the industry moving in the right direction.
Whilst there is still some way to go before the real estate sector is completely transformed, both Keune and Bocchibianchi see great potential for PropTech, especially VR/AR, to disrupt this very traditional industry. And a number of initiatives have launched in recent years to help connect stakeholders in the industry, and offer collaboration opportunities. Such initiatives are likely to accelerate the Luxembourg real estate market’s adoption of PropTech.
Report courtesy of our content Partner site Silicon Luxembourg