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Digitization—the strategic use of technology to collect, create, process, organize, analyze, use, and monetize data—has the potential to advance efforts to address challenges related to housing affordability, equity, resiliency, and livability, according to a working paper from the Harvard University Joint Center for Housing Studies’ Chris Herbert and David Luberoff. According to the authors, some “dramatic changes” have come as more than $100 billion in venture capital funding has been invested in the sector since 2019. A demonstrable illustration in the housing sector is the shift toward digital technologies used to find, buy, rent, and manage single-family homes, according to the authors. The paper was one of several presented at the JCHS's symposium Bringing Digitalization Home: How Can Technology Address Housing Challenges.

Taken as a whole, the papers from our symposium make it clear that some digitalization-driven changes have advanced efforts to address housing challenges; some seem to be exacerbating problems; and some have the potential to either address or exacerbate challenges. For example, tools like smart thermostats and improved monitoring devices can play a role in efforts to both reduce greenhouse gas emissions from homes and allow more people to age-in-place. In contrast, the increased use of digital tools by investors buying single-family housing appears to be exacerbating affordability challenges and, in some cases, hampering efforts to close the large racial homeownership gap.

Outcomes are less clear in other areas, such as whether AI and machine learning can significantly reduce biases in mortgage underwriting. And digitalization has yet to spur significant changes in some areas, such as facilitating increased use of offsite construction techniques that could reduce the cost of building new housing.

The full working paper is available to review online and covers how digitization is transforming many key aspects of housing and analyzes whether these changes are likely to produce benefits to various stakeholders.

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