Why property needs to embrace the power of data.
Real estate is potentially the biggest untapped data source in the world. Firms accumulate billions of data points at every stage of the development lifecycle, from the breakdown of building materials to the spending patterns of tenants. Fully harnessing this data would create new insights and allow investors and developers to make better informed, more reliable decisions.
However, the industry has been reluctant to harness technology which can break down this data to its full potential.
That’s now starting to change, especially in relation to rental income. Rent is the most significant and reliable source of long-term income in property. Data from MSCI suggests that rental income now makes up to 70% of real estate investors’ long-term total returns (UK data).
This subtle shift in focus, away from the capital value of an asset, was already underway and accelerated at pace as a result of the pandemic.
“Landlords are now recognising the need to work with tenants to deliver a service”
