Dive Brief:
- In 2025, $16.7 billion was invested globally in proptech and adjacent real estate technology companies, a 67.9% year-over-year increase from 2024, according to an analysis from the Center for Real Estate Technology & Innovation.
- Investment also surpassed pre-pandemic levels in 2019, when approximately $14 billion was placed in proptech. Even though investor behavior remained disciplined, CRETI said capital formation showed a clear recovery in 2025.
- Last year, investment was focused on a small number of large transactions, with debt and structured financings dominating at scale. CRETI said that seed and Series A activity remained strong as growth-stage valuations reset, with the market focusing on capital efficiency, retention and alignment with real-asset economics.
Dive Insight:
Proptech venture capital funding entered 2025 amid cautious expectations driven by constrained exits, higher interest rates and tighter underwriting, according to CRETI. However, capital deployment did not rebound as many market participants expected, despite exceeding pre-pandemic levels.
“I'm optimistic about this year, but as a venture investor, you're optimistic about every year,” said Matt Knight, executive director at the Foundation for Innovation in Real Estate and founder of the PropTech Angel Group. “Each of the last two years, people are like, ‘It can't be as bad as last year.’ But it kind of has been.”
On the U.S. multifamily front, property-level issues with banks extending to troubled borrowers have trickled down to proptech spending, according to Knight.
“We’ve been waiting for consolidation and people to combine and merge and sell, and it just hasn’t happened at the volume anybody is expecting.”
Aaron Ru, a principal at Park City, Utah-based real estate technology venture capital firm RET Ventures, expects multifamily proptech funding to be active but more selective in 2026.
“Capital is available, but investors are prioritizing companies with strong fundamentals, clear product-market fit and proven customer stickiness and retention,” Ru said in emailed comments to Multifamily Dive. “Startups from the 2021-2022 cycle without these attributes may face increased pressure, leading to greater consolidation across the sector.”
Ru said that investors are gravitating toward platforms that deliver immediate, measurable impact, including tools for leasing and marketing efficiency, maintenance and procurement optimization, resident engagement and portfolio-wide data visibility.
“Technologies that are deeply embedded in core workflows, rather than flashy point solutions, are attracting the most interest,” Ru said.
Outside of artificial intelligence, people aren’t paying “silly numbers” anymore, according to Knight. But even though AI will be a focus, expectations have risen, Ru said.
“Investors are favoring AI-enabled solutions built on strong data foundations and integrated into mission-critical systems, as opposed to surface-level applications that lack durability or operational relevance,” Ru said.
Efficiency and simplification will also be investment themes, according to Ru. “Solutions that help owners and operators do more with leaner teams, reduce operational complexity and drive sustainable NOI growth are expected to remain top priorities in 2026,” he said.
Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday.
