How will technology affect Real Estate Investing?

Question

We live in a fast moving world. What technology improvements do you see in the next ten years that will change how you invest?

One thing that I always think about is driverless cars. Google has driven a half million miles now without a driver, they have a license to operate in Nevada, and I really think driveless cars be available in five years to enthusiasts.

This will change the world. We will no longer need taxi drivers or semi drivers. Goods will become cheaper and it will cost less to ship things. There will be very few deaths from automobiles. The commute to work will now be done reading the news on your computer or tablet. Cars will be able to drive just a foot from each other and they will all communicate, eliminating traffic jams.

On one hand this will mean that people might be willing to live farther from work if they don't have to drive. This might be good for housing in the suburbs.

On the other hand, we might not own cars at all. There may be no reason if you can just hit a button on your smartphone and the nearest car drives to your GPS location and takes you where you want to go without needing the expense of a driver. This might benefit real estate in urban areas as we won't need to worry about parking.

Thoughts?

http://www.youtube.com/watch?v=cdgQpa1pUUE

Steve Craig · Answer

The biggest change in Real Estate because of technology will be/is MOBILE DATA and SMART PHONE APPLICATIONS. I'm over 50 and I no longer fight technology. I have a Real Estate Analysis application on my phone that allows me to analyze a potential buy and hold in less than a minute. It crunches the data and lets me project the cash flow, NOI, ROI and more on my darn phone. I use my camera phone to remind me which house is which when I drive properties and I keep all my forms and files in the cloud and access them from anywhere I can get cell service or grab unprotected wifi. I'm now fascinated by mobile applications. I wanted to know if the setting sun was going to blast thru the glass doors on a house so I looked at the compass on my phone. I use it to remind myself of tasks to be done and where I'm supposed to be and when (it's more reliable than a wife). You will step up your Real Estate game if you stop fighting technology and begin to embrace it.

Robert Steele · Answer

Andy hit the nail on the head there. In the old days if you wanted to do title searches you had to either pay a title company or go downtown to the county clerks office and search through microfilm. Now days it's all online and easily accessible.

Only a few years ago you used to have to dig through the local newspaper for Sheriffs sales. Now they are posted online.

As everything gets easier to do the barriers to entry lower and the competition increases. Thus the shrinking profit margins.

Dale Osborn · Answer

Sure hope that real estate investing doesn't turn into another mini Wall Street or commodities trading.

Andy Chu · Answer

Trying to keep the topic on course here. I would say that with the recent success of RedFin, Zillow, eppraisal, the industry is becoming more efficient. I'm starting to feel that margins will shrink as more and more people can get closer to perfect information. As a real estate professional working with some of the biggest lenders, I've noticed that there are less conversations and everyone is just a step in the process. In essence, homes will be traded like commodities and the spreads will thin out.

Eric L. · Answer

An interesting article came up today. eBay is offering same day shipping in San Francisco as a pilot for major retailers.

http://finance.yahoo.com/news/ebay-tests-same-day-delivery-191212623.html

This will require a lot of couriers today, but with automated cars this will make same day or even same hour delivery for online orders the norm shortly. I think this is another blow to brick and mortar retail real estate.

Joel Owens · Answer

Eric even if cars could take to each other I can see computers crashing and the cars crashing as a result.

Your idea sounds good in theory but I don't think it's practical and is a long way off.

"Amazon and eBay have crushed Commercial Investing for storefronts and even larger chain spaces."

This is true for certain retail but not all.Retail is actually picking up speed.The issue isn't the stores are not doing sales.The issue is they built a really big footprint and then things went online not requiring the same space anywhere.

Retail development has downsized more now for many aspects.Brick and mortar is not going away but evolving.

Account Closed · Answer

Eric L. I don't even pretend to know how technology might be used.  Nanotech might be utilized in building materials for all I know.

Dale Osborn · Answer

We can let the next generation have all of the modern technology.

Perhaps computers will be eliminated? With all the new gadgets and gizmos coming out there may not be much of a need for computers anymore.

Eric L. · Answer

Hi Charles,

How will nanotechnology affect Real Estate Investing? Obviously, Amazon and eBay have crushed Commercial Investing for storefronts and even larger chain spaces.

What is the next trend we need to be aware of? I work from home every day for a fortune 500 company. Will telecommuting crush office space as well?

Account Closed · Answer

Dale Osborn I agree.  I quit even trying to keep up with the Joneses long time ago.  I have trouble enough learning the technology I already have.