What are the Implications of Smart City on Realty?

Smart cities, valued for abilities including technology, efficiency, mobility, and urban planning, have a positive impact on the development of the real estate industry.

FREMONT, CA: Smart city seems to be one of the most fashionable concepts of the era. At its core, smart cities are about efficiency. The real estate industry has the potential to shape the evolution of smart cities, and at the same time, is one of the principal beneficiaries of this new entrant.

By creating buildings that operate efficiently and those, which are more desired by the tenants, smart city technology will attract price premiums. This is because smart buildings will become more attractive to buyers due to lower operating costs and better retention of value. Besides, the ubiquity of interactive technology and tailored services in smart cities will lead consumers to have increasingly high expectations of service providers. Given that, those who are not able to keep up with this new paradigm will risk themselves being left behind.

 A smart city is a crucial facilitator in the run towards more flexible property uses. Developments in the future will need to be designed with greater flexibility in mind, to allow technologies to drive the most efficient use of the assets. Greater transparency in the performance and access to real estate will lead to a shift from traditional leases, to services-based models with shorter and more flexible contracts, or even no rentals.      

The increased availability of data from public and private sources will improve the quality of evidence available to justify investment decisions, to make planning arguments, tailor master plans, and many more. Realtors will need to understand these emerging data sources and how they can capitalize on them. As smart cities push the frontiers of technology, realtors will need to collaborate with multiple stakeholders to develop innovative solutions for development challenges.    

Connected smart buildings have the potential to reduce energy use, perform preventative maintenance, and decrease operating costs. In-depth building and resident data mean greater transparency in real estate transactions, allowing renters and buyers to understand assets better. With all this, it can be undoubtedly said that a smart city is an excellent disruptor for the real estate industry.  

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