Developers are increasingly shifting their focus to virtual reality to sell apartments.
JAMIE Clarke is a virtual reality convert.
The Megara director was sceptical of the technology but now sees its value for selling apartments off the plan.
“We have been looking at VR for about four or five years but the technology was a bit clunky,” Mr Clarke told Business News.
“Over the last 18 months it has improved a lot.”
Previously, the Leederville-based developer would invest heavily in still renders to showcase its projects but has transitioned to using 3D modelling of its developments to create virtual footage.
While still renders (which depict one scene per image) still play a role, a lot of the company’s marketing spend is devoted to virtual reality.
Paul Clayton, general manager of Blank Canvas Studio, has been instrumental in that change.
Mr Clayton heads up a team that creates 3D renders of residential projects, which enable potential buyers to simulate the experience of walking through the finished product.
Blank Canvas also works with Edge Visionary Living, Blackburne, Cedar Woods and several national home builders.
The company is owned by ASX-listed Vection Technologies, which acquired the architectural visualisation studio in 2021.
Escalating construction costs and labour shortages have led to some developers pulling out of projects in recent years, which has made buyers reluctant to buy off the plan.
But the incorporation of virtual reality helped provide more clarity to people looking to buy into a development, Mr Clayton said.
“The reality is, when you’re buying off the plan, it’s equal parts excitement and trepidation,” he told Business News.
“The excitement is you’re buying something cool and new, and it’s going to be shiny and beautiful.
“The trepidation is it is sight unseen because there are only a couple of renders to go on a floor plan.
“Using VR to empower buyers to make an informed decision is really valuable.”
He said that when it came down to deciding whether to buy an apartment, buyers were more likely to select the one they had seen a virtual rendering of.
And as more developers adopted the technology, it would be difficult to sell an apartment without it, Mr Clayton said.
“As a buyer, fast forward 12 months [and] if you are choosing between three different apartments and you’ve walked through one but not the other two, you are much more inclined to go with what you’ve experienced and what you know,” he said.
“I think that will be a commercial driver for developers to start having to use this, because the buyer demand is going to be there for it.”
Megara’s Ora Sorrento apartments have been modelled into 3D renders for virtual reality walk throughs. Image: Blank Canvas Studio
Premium developers currently pay up to $40,000 to create a 3D visualisation of a project so it can be viewed through a virtual reality lens.
In most cases, developers choose a select number of high-end apartments and amenities to showcase in virtual reality format.
This means potential buyers cannot always see the home they are looking to invest in.
Mr Clayton said though virtual reality was well suited to the premium products, this should not mean the visualisations were limited to a small number of dwellings.
“When you’re spending millions of dollars in market to be able to show buyers what it looks like, that amount of money (to 3D render a project) shouldn’t be cost prohibitive,” he said.
“I think the biggest challenge … [is] often developers might not be inclined to showcase all of the apartments, because some of the smaller apartments might not look that great in VR,” he said.
“Our challenge to the industry is to say, ‘let’s do the right thing by buyers, you should be proud to show a buyer even a small apartment in VR, because that’s what they’re going to be left with when the thing is actually built’.
“There’s no reason that you shouldn’t be incentivised to actually bring that to life in VR, even at that smaller price point.”
He said as technology improved and artificial intelligence was more accessible, the cost of incorporating virtual reality into projects would come down.
“We will definitely be able to reduce that cost in the next 12 to 24 months, and you’ll be able to … walk through the lobby, go up a lift, go to any floor and go to any apartment, essentially.”
Mr Clarke agreed that the off-the-plan space lent itself to virtual reality.
“The biggest challenge at the moment is uncertainty over builds progressing,” he said.
“You’ve got to give buyers confidence in what they’re buying.”
Mr Clarke said Megara, which was utilising virtual reality to sell its Serai project in North Fremantle, could provide for certainty to the market through the technology.
“We are not just having a crack at pre-sales and hoping we will build it,” he said.
“You don’t enter into something like this without being committed.”
He said developers continued to set benchmarks for each other through the quality of the renders they used through their marketing.
Virtual reality technology has evolved to a point where it allows users to adjust settings that change the finishes on an interior, the floor from which you are taking in the view, and the lighting at various times of day.
This helps buyers choose the colour palettes they would like in their apartment.
Detached home builders and land developers have expressed an interest in the technology for its potential to replace the display home.
Mr Clayton said using 3D modelling instead of building display homes made a lot of sense to industry.
“We’ve got three different major proposals with home builders in WA, Victoria and New South Wales,” he said.
“If you think about [the fact] some of these builders have big display homes nationally, they might have each display home probably cost them $800,000 on average, so you’re talking about $40 million of bricks and mortar around the country.”
He said physical display homes were not only costly but their protracted build times meant they sometimes did not keep up with interior design trends.
“Going to a virtual display village is the next chapter for sure, there’s no doubt in my mind at all,” Mr Clayton said.
“That’s the conversation we are having with a number of builders.
“There’s a big appetite to do it [but] we haven’t delivered any projects in that space just yet.”
The technology can also be applied to furniture showrooms.
Mr Clayton explained that using virtual reality enabled furniture companies to reduce their footprint and thus their leasing costs.
“It’s expensive to lease a 3,000 to 5,000-square metre retail premises,” he said.
“If you can show an entire warehouse full of stock in a space that’s 25 square metres, it can be very valuable.
“We’re talking to some clients about concept VR showrooms.”
Virtual reality can also be applied to home renovations, with the technology showing what a space could look like if it was revamped.
Blank Canvas is working with super yacht companies to create 3D visualisations of craft that can place the user in different environments, such as Portofino or Rottnest Island.
Mr Clayton said the economics of creating lifelike video renders of these yachts stacked up, given they sold for up to $40 million.
“You can only afford to make so many,” he said.
