Amid unexpected challenges, technology has found ways to help us get things done. Some tech advancements, barely imaginable a few years ago, are making themselves indispensable. And while pre-pandemic homebuying was filled with in-person meetings and tours, apps and gadgets are folding much of the process into digital experiences.
For professionals in the field, repetitive tasks are now automated. Even a property appraisal can be carried out virtually. Everything is about to become more integrated. Online home touring is meshing into home shopping. This adaptation process has brought real estate into a new era.
Let’s take a virtual tour of this landscape in 2022.
Customers Can Build and Furnish Their Virtual Dream Homes—Then Buy Them
Lennar is a massive presence in the U.S. home building and loan field. It is also becoming increasingly tech-focused, through its tech research lab, LenX. Recently, we looked at Lennar’s investment in ICON, the Austin, Texas robotics firm and 3D home builder. The company’s plans for 2022 include a development that consists only of 3D printed houses, conceived as a model of efficient and affordable housing creation.
In addition, Lennar is now investing in the interior design platform Modsy®, which takes prospective buyers on virtual walkthroughs of concepts of homes. The home shoppers can, in effect, edit the future building’s interior design. There’s an element of e-commerce here too. The Modsy platform lets homebuyers buy furnishings they see in a virtual model.
While virtual model homes are not cheap, it’s far less expensive to create them than to build actual model homes. Plus, they can be explored by many more viewers. Then, builders outfit homes to suit a range of buyer preferences. This system has proven itself to be a highly effective marketing tool to Lennar. The platform has another advantage, too, that saves both money and space. Unlike the thousands of physical model homes across the country, virtual ones don’t take up land or create traffic only to stay empty.
Regular folks can use the Modsy app, too, to connect with interior designers and get all the guidance needed to do a professional furnishing project.
Digital Experiences Can Smooth Out the Path to the Final Mortgage Approval.
Should buying a home be easier and faster? Could lenders automate the journey from underwriting to closing and make key steps and details transparent?
Today, the whole process still takes between a month and six weeks from the start of the underwriting — or even longer. Companies can be overloaded with clients, or run into large numbers of unusual financial profiles to assess. Loan applications from investors and entrepreneurs aren’t slam-dunks. At least not yet.
But although we’re nowhere close to same-day service, we can use apps to give us a yes or no answer on whether a loan is obtainable. And we can get online guidance through the mortgage approval process.
Digital Startups Make Lenders and Borrowers Smarter.
Some apps offer constantly updated checklists to keep the applicant engaged and on track. The Beeline app at MakeABeeline.com (“Get a reliable approval in 15 minutes“) continually tells applicants where they stand in the approval process. The app goes straight to the customer’s bank information, enters the applicant’s real data, and produces numbers that allow home buyers to make serious offers. Beeline is based in Providence, RI, and licensed to do business in 25 U.S. states. Then there’s San Francisco-based Roostify. It automates the slog of pay stub and tax paper assessments. It’s just launched Roostify Beyond “to create the highest possible efficiency for lenders.” The innovation instantly tells applicants when they need to correct the information they upload, so the lender doesn’t have to.
Big Banks: Meet App Culture.
Mortgage experts with Bank of America now offer the Digital Mortgage Experience®. The app guides customers through the preapproval stage, helps them check their loan status, and enables electronic document signing. The gist of it? More transparency and control for applicants. Watch for more bank apps that use auto-filling and machine learning, and respond promptly to requests. And watch for portals from lenders that allow homeowners to manage their mortgage payment options, with tax documents and other key files linked into customer accounts for ease of reference.
Remote Home Appraisals Are the New Home Appraisals.
It’s an energetic time for real estate transactions, to put it mildly. Finding enough appraisers to attend to them is no easy feat. With the advent of valuation software, there’s a workaround for the nationwide shortage of appraisers.
And there’s big news. In 2022, Fannie Mae and Freddie Mac will routinely accept desktop appraisals to support the timely flow of conventional loans. What will this mean? Real estate agents won’t have to recruit appraisers to come to the property and examine the home. Transactions could close much faster—as quickly as ten days in some cases.
Remote appraisals were brought into emergency use in 2020, to allow greater flexibility during a time of health-related shutdowns. Now, the desktop appraisal is an official option for originating conventional loans. There are a number of benefits to permanent adoption of the method. These benefits go beyond faster closings, as Housing Wire points out. Fill-in forms and standard methods will facilitate data sharing from appraisers to banks and credit unions. The method is less expensive. It not only makes the appraiser’s and the lender’s lives easier; it smooths out the paths for applicants, too.
Everyone who uses the digital valuation method could use the same forms and apply a uniform data set to all homes. This will replace the various approaches of companies. Housing Wire says the whole method is a boon to the quest for objective, unbiased appraisals.
At Deeds.com, we think this is a key point in the year ahead. The federal government has a new task force to deal with appraisal bias, led by Housing and Urban Development Secretary Marcia Fudge. Automated valuations will become a big part of the anti-bias initiative, with developers learning more about eliminating discrimination from algorithms. But the main idea is simple: it’s a matter of standardizing the data used by the appraiser, so that the valuation relies on floorplans, footage, and other objective facts.
☛ Learn more about how the industry is confronting appraisal bias on Deeds.com.
And the Apps Keep Coming.
We’re still in the early days of a remarkable decade of digital advances. People who want to get financing or refinancing, find brokers, buy, sell, or rent properties, or even trade shares of real estate can all find apps to assist. If you’re planning a real estate transaction in 2022, chances are you’ll be putting digital technology to use.
Supporting References
Fred Nicolaus for Business of Home: Modsy Is Making Home Tours for Homes That Don’t Exist – Yet (May 12, 2021).
HousingWire.com: Permanent Desktop Appraisals Are a Win for Everyone – Here’s Why (Dec. 16, 2021).
Jeff Ostrowski for Bankrate.com: 5 Tech Trends That Will Move Mortgages and Housing in 2022 (Dec. 20, 2021).
Deeds.com: 3D Building Trend Ramps Up to Meet Housing Shortage (Jan. 5, 2022).
Deeds.com: The Biden Administration Confronts Racial Bias in Appraisals (Jun. 21, 2021).
Photo credits: Tima Miroshnichenko, Gary Barnes and Matilda Wormwood.