Almost a year before tenant Jack Sazama was actually able to set foot in his new apartment, he put on a pair of virtual reality (VR) goggles and signed his lease.
“The buildings weren’t even up yet, so it was nice to get a sense of what it would look like,” he told the Star Tribune.
Sazama, a student at the University of Minnesota, isn’t the only person to use virtual reality for real estate, either. Indeed, VR could disrupt the real estate industry in much the same way that internet listings did. Already, landlords around the country are investing in fancy new websites and property management software, and for good reason: 38% of users will disengage with a website if the layout isn’t attractive.
Internet home listings operate on the same basic principle: if the photos online aren’t attractive, it’s unlikely buyers will want to see the house in person. Today, 32% of home buyers are first-time buyers, and that number includes many tech-savvy Millennials. These buyers may base much of their purchasing decision on what they see listed online.
But now virtual reality offers a whole new way of looking at a space. Rather than two-dimensional pictures, home buyers can take a virtual tour of a home, even before it’s built.
“It is a foregone conclusion that we’ll be evaluating real estate this way in the future,” said Gene Munster, a Twin Cities tech analyst and investor.
Munster, and others like him, believe that VR may be the most significant development in real estate since the Internet itself (of course, many real estate experts have said the same thing about drones). Although the virtual tours aren’t quite three-dimensional, they still give a much more accurate picture of what a home looks like.
In addition to physical appearances, these tours can give viewers an idea of how spacious a home is. Not only that, but they allow potential buyers to really imagine themselves inside a space.
And technology companies have already started to take advantage of this real estate trend.
VR startup VirtualAPT is using its unique camera software to create videos and 360-degree real estate tours for landlords who want to show off residential and commercial spaces. The software for landlords not only creates a virtual tour, it can add certain features to a space to give it a “lived in” feeling. Think of it as virtual home staging.
The company has discovered that adding features to residential listings with their software doesn’t always pan out, but that commercial spaces in particular benefit from the treatment.
“We are giving a lifelike experience to raw space,” said David Falk, the tri-state president of commercial real estate firm Newmark Grubb Knight Frank, of VirtualAPT’s software.
Though virtual reality and augmented reality real estate technology is still developing, its current prices and capabilities are perfect for many landlords. And the future may hold even more virtual surprises.