Is the Prop Tech Market growing now?
In our Prop Tech market deck, you will find everything you need to understand the market
SUMMARY
Yes. The PropTech market is growing now, and the clearest evidence is coming from customer spending and company revenue rather than from venture-funding headlines.
Four large listed PropTech companies—CoStar, Zillow, AppFolio and Procore—grew combined quarterly revenue by 17.9%, with each company expanding between 16% and 19%. That consistency across very different parts of real estate is hard to explain as a single hot niche.
Funding has recovered from the post-boom collapse, but it is no longer accelerating. First-half 2026 global funding was essentially flat year over year, and July weakened again.
The funding totals also look healthier than the underlying venture market. Nearly half of first-half capital came from just 11 rounds above $100 million, while debt and private equity represented 38.1% of total funding.
Property-management software is showing a particularly strong monetization pattern. AppFolio's units under management rose 8%, while value-added services revenue increased 22%, which suggests customers are buying more technology per property rather than growth coming only from adding more buildings.
Construction tech is another clear winner. Procore is still growing at double digits, large-customer counts are rising, and construction and development companies have repeatedly taken a large share of recent PropTech funding.
AI is already creating commercial demand, but mostly where it removes a specific workflow. Real estate companies are increasing technology budgets for AI even though only a small share have achieved most of their broader AI-program goals.
Consumer PropTech can grow even while housing activity remains mediocre. Zillow grew 18% while its estimate of the residential real-estate industry grew about 6%, and it did so despite slightly lower traffic.
The business-model split is getting sharper. Software, marketplaces, data and transaction infrastructure are producing growth and improving profitability, while capital-heavy housing models such as iBuying remain much harder to scale economically.
Consolidation is reinforcing that pattern. CoStar and Rocket have spent billions buying assets that add proprietary data, marketplaces, digital twins, brokerage demand and transaction access—things that are much harder to replicate than another generic software layer.
The result is a market that is growing, but not evenly. Property operations, construction software, AI automation, data, marketplaces and transaction infrastructure are expanding; ordinary software startups and asset-heavy housing models are being left with a much tougher market.
This market map, featured in our Prop Tech market deck, highlights top companies and startups in the proptech market
What do we actually mean when we say the PropTech market is growing?
PropTech market growth today should mean that real estate companies are spending more on technology and that the companies selling that technology are growing, rather than simply seeing more money flow into investment rounds.
That distinction changes the answer quite a lot. PropTech covers property-management software, construction technology, home-search platforms, mortgage tools, building data, AI automation and some capital-intensive housing businesses. A $300 million debt facility for a housing platform and $300 million of new software subscriptions would both increase someone's estimate of the "PropTech market", but they tell us very different things.
We therefore looked for growth in three places: customer spending, company revenue and investment activity. Revenue is the most useful test because it shows whether customers are actually paying more. Funding tells us whether investors believe new companies can still be built. Real estate activity helps us work out whether technology companies are simply benefiting from a stronger property cycle.
That gives us a much harder test than taking a market-research forecast at face value.
Did PropTech funding really come back?
PropTech funding has recovered from its post-boom collapse, but the recovery has stopped accelerating for now.
CRETI counted $16.7 billion of global PropTech and adjacent real estate technology investment in 2025, up 67.9% from the previous year. That was the sector's highest annual total in three years and even exceeded the roughly $14 billion recorded in 2019.
The latest data look less spectacular. CRETI counted $4.53 billion across 231 rounds during the first half of 2026. Funding was 0.6% lower than a year earlier and only 2.6% above the same period in 2024. Compared with the first halves of 2021 and 2022, investment is still roughly 65% lower.
July then weakened again. Only 32 companies raised capital, down from 49 a year earlier, while total funding fell 31% to $528 million.
Investor attitudes have improved more clearly than those funding totals. MetaProp and PwC's latest PropTech Confidence Index put investor confidence at 6.5 out of 10, up from 6.2 six months earlier. Startup confidence jumped from 6.1 to 8.1, its highest reading since 2021, and 59% of founders expected fundraising to become easier.
Investors have stopped behaving as though PropTech is a damaged category. They are willing to finance it again, but they are still choosing carefully.
As this chart shows, and as featured in our Prop Tech market deck, search interest in proptech has been climbing steadily
Are a few giant PropTech deals making the funding market look healthier than it really is?
Yes. PropTech funding is currently much more concentrated than the headline totals suggest.
The pattern was already extreme in 2025. CRETI found that just 35 financings of at least $100 million absorbed $12 billion, or 71.9% of all the capital invested during the year. Around 77% of those large financings involved debt, securitizations or private-equity-style capital rather than conventional venture equity.
The same structure has continued. Eleven rounds above $100 million represented almost half of all first-half 2026 funding. Meanwhile, 75 rounds below $5 million together captured only 2.8% of the money.
Debt and private equity accounted for 38.1% of total first-half funding. That is a big share for a market that is often discussed as though every dollar represented venture investors backing young software startups.
Europe looks even more concentrated. According to Tech.eu's latest dataset, European PropTech companies raised €253 million in the first half of 2026, 53% more than a year earlier, even as the number of rounds fell from 37 to 21. The ten largest rounds took 97.7% of all disclosed capital. Gropyus, Dwelly and Hallo Theo alone represented around four-fifths of the total.
Young companies are still getting started. CRETI found 26 U.S. PropTech startups that raised between $500,000 and $2 million in the first half, but their median round was only $707,000. Today's early PropTech market is being built with much smaller initial checks than the last generation.
| PropTech funding measure | Latest reading | What it tells us |
|---|---|---|
| H1 global funding | $4.53B | Essentially flat YoY |
| $100M+ rounds | 49.6% of H1 capital | Funding remains highly concentrated |
| Debt + private equity | 38.1% of H1 capital | Headline funding overstates pure VC activity |
| European funding | €253M, +53% | More money, but across 43% fewer rounds |
| European top-10 share | 97.7% | Extreme concentration |
If you want more recent data on this point, please see our latest Prop Tech market report.
Are real estate companies actually spending more on PropTech today?
Yes. Customer spending is growing much faster than the PropTech funding market, and this is the strongest evidence that the underlying market is expanding.
We combined the latest quarterly revenue from four large listed companies that cover different parts of real estate technology: CoStar, Zillow, AppFolio and Procore.
Together they produced about $2.35 billion of quarterly revenue, up from roughly $2.00 billion one year earlier. That is 17.9% growth and around $358 million of additional revenue in a single quarter.
The mix is useful. CoStar sells property data, analytics and marketplaces. Zillow monetizes housing search, rentals, agents and mortgages. AppFolio serves property managers. Procore sells software to the construction industry.
All four grew between 16% and 19%. When several businesses serving different customers move at almost the same double-digit pace, it becomes difficult to dismiss PropTech growth as one lucky niche.
| Company | Latest quarterly revenue | YoY growth |
|---|---|---|
| CoStar Group | $925M | 18% |
| Zillow | $772M | 18% |
| AppFolio | $281M | 19% |
| Procore | $375M | 16% |
| Combined | ~$2.35B | 17.9% |
This chart, included in our Prop Tech market deck, illustrates yearly VC funding for proptech startups
Is property-management PropTech growing especially fast right now?
Property-management PropTech is one of the clearest growth areas today because landlords are buying more software per property, not simply adding more buildings to existing systems.
AppFolio ended its latest quarter with 9.6 million units under management, up 8% from a year earlier. Its value-added services revenue grew 22% to $219 million over the same period.
That gap is important. The number of properties on the platform grew in the high single digits while revenue from payments, screening, insurance-related services and newer AI products grew much faster. AppFolio is getting more revenue from each unit it already serves.
Zillow's rental business shows a similar pattern from the marketplace side. Rental revenue reached $209 million, up 31%, while multifamily revenue grew 42%. The number of multifamily properties advertised through Zillow Rentals reached 79,000, 23% more than a year earlier.
Then there is EliseAI, which automates leasing, resident communication and other operational work. The company reported passing $200 million in annual recurring revenue after five consecutive years of roughly 100% growth. EliseAI has expanded into healthcare, so we cannot count all of that revenue as PropTech, but the company says its technology is now used across one in six U.S. apartments.
We are seeing the same pattern from three angles: more properties using software, property managers buying more products per property, and AI companies taking over tasks that used to require staff. Property operations has already become a large software market.
Is construction tech becoming one of PropTech's biggest winners?
Construction tech is currently one of the strongest parts of PropTech, with customer growth and venture capital pointing in the same direction.
Procore's latest revenue reached $375 million for the quarter, 16% higher than a year earlier. Its number of customers spending more than $100,000 annually increased 14% to 2,871. The company also maintained 95% gross revenue retention.
The private market has been active around narrower construction problems. Higharc recently raised $95 million to expand its AI platform across home design, estimating and construction. The funding took Higharc above $170 million raised in total and came alongside a partnership with US LBM, one of America's largest building-material distributors.
Capital allocation across the broader market confirms the trend. Construction and development companies received $260 million in PropTech funding in July, almost half of all the money invested that month. They had already taken the largest share in May.
Investors are gravitating toward estimating, permitting, procurement, robotics, project controls and building design because the customer problem is easy to understand. Construction still involves expensive manual work, fragmented contractors and delays that can cost far more than the software used to prevent them.
That makes construction tech unusually easy to sell when the product genuinely saves time or labor.
If you want more recent data on this point, please see our latest Prop Tech market report.
This chart, included in our Prop Tech market deck, looks at Compass’s strategy in proptech
Is AI actually creating new PropTech revenue, or is it still mostly experimentation?
AI is already creating real PropTech revenue, although most real estate companies are still far from using it at full scale.
JLL's Global Real Estate Technology Survey found that 88% of real estate investors had begun AI programs. Across the wider survey, organizations were pursuing about five AI use cases on average.
The spending response was even more interesting. JLL found that 87% of respondents expected AI to increase their real estate technology budgets. If companies were simply replacing one software product with an AI-branded alternative, budgets would not necessarily rise. Here, many buyers are putting additional money into the technology stack.
Actual execution is much weaker. JLL later reported that only about 5% of companies running AI projects had achieved most of their program goals. Most real estate organizations still struggle with fragmented data, old systems and the practical work required to roll AI out across thousands of buildings or employees.
That helps explain why the companies growing fastest tend to solve narrow jobs. EliseAI handles leasing and resident communication. Higharc tackles design and estimating. AppFolio is adding agents for leasing, maintenance and resident messaging.
Real estate companies are currently much more willing to pay for AI that removes a specific workflow than for a vague promise to "transform real estate."
Is commercial real estate tech growing again too?
Commercial real estate technology is growing again, helped by a real recovery in property transactions and leasing.
The property market itself is healthier. JLL measured $216 billion of global direct real estate investment in the first quarter of 2026, up 18% year over year. Investment in the Americas rose 25%.
CBRE's latest results show that recovery continuing. Global leasing revenue increased 24% year over year and property-sales revenue increased 20%. Transactional businesses as a whole grew 19%.
CoStar's commercial real estate businesses moved more slowly, but still grew from $446 million to $481 million of quarterly revenue, an increase of about 8%.
The venture market remains more cautious. Only $46.5 million went into commercial real estate and building-operations startups in CRETI's latest monthly breakdown, less than 9% of the month's total PropTech investment.
We see a recovery rather than a boom. Brokers, landlords and investors are doing more business again, which gives data, underwriting and operating platforms more room to grow. Venture investors still seem more excited by construction and housing software.
This chart, included in our Prop Tech market deck, illustrates yearly funding for proptech startups
Can consumer PropTech grow while the housing market is still weak?
Yes. Zillow is already growing much faster than the U.S. housing market, although Opendoor shows how dangerous the consumer PropTech business can become when the company has to own the houses itself.
Existing-home transactions remain sluggish. Mortgage rates are still high by the standards of the previous decade, and Zillow estimates that the U.S. residential real estate industry grew only about 6% during its latest quarter.
Zillow nevertheless grew total revenue 18%.
Its mortgage business was the standout, with revenue up 75% to $84 million as purchase-loan origination volume almost doubled to $2.2 billion. Rentals grew 31%. For-sale revenue increased 14%.
Traffic did not drive the result. Zillow's average monthly users actually fell 2% to 239 million and visits declined 2% to 2.5 billion. The company simply made considerably more money from roughly the same audience.
Opendoor shows the other side of consumer PropTech. Its latest quarterly revenue was $883 million, 44% below the previous year, as homes sold fell from 4,299 to 2,339. The company is rebuilding its acquisition volume and gross margin has improved, but it still lost $162 million during the quarter.
The difference comes down to how much real estate risk sits on the balance sheet. Zillow can sell leads, advertising, software and mortgages without owning thousands of homes. Opendoor has to buy the physical asset, finance it, renovate it and resell it at the right price.
Consumer PropTech can grow in a mediocre housing market. Asset-heavy models have a much harder job.
If you want more recent data on this point, please see our latest Prop Tech market report.
Is PropTech growth becoming profitable now?
Yes. Several major PropTech companies are growing while profitability improves at the same time, which makes today's expansion considerably more convincing.
AppFolio's GAAP operating income reached $53 million, up 31% from the previous year. Its operating margin widened from 17.2% to 18.8%, while quarterly operating cash flow jumped from $53 million to $88 million.
Procore reached GAAP operating profitability in its latest quarter. Free cash flow climbed to $65 million, more than six times the previous year's level.
CoStar reported $55 million of net income compared with just $6 million a year earlier. Adjusted EBITDA reached $184 million, more than double the previous year.
Zillow generated $176 million of adjusted EBITDA and a 23% adjusted EBITDA margin while continuing to invest heavily in mortgages, rentals and its broader housing platform.
Opendoor remains the obvious exception. Its business is improving sequentially, but a $162 million quarterly loss makes it difficult to put the company in the same economic category as software and marketplace businesses.
The quality of PropTech growth has improved. Some of the largest companies can now add double-digit revenue while producing more cash, which is a much healthier setup than the growth-at-any-cost period.
This chart, included in our Prop Tech market deck, compares the main business model options for proptech property management platforms
Are big real estate companies buying more PropTech companies?
Yes. PropTech consolidation is happening right now, and large buyers are paying for technology that gives them more control over data, marketplaces and the transaction itself.
CoStar has become the clearest example. It bought Matterport for approximately $1.93 billion, adding 3D digital-twin technology and a large database of digitized buildings. CoStar has now also completed its $800 million acquisition of Zonda, which adds homebuilder data, software, NewHomeSource and Livabl.
The second deal is particularly fresh. CoStar only recently closed the Zonda acquisition, giving us evidence that its consolidation strategy is still active rather than something that happened during an earlier part of the cycle.
Rocket took a similar approach by acquiring Redfin in a $1.75 billion transaction. The combination connects Redfin's home-search audience and brokerage business with Rocket's mortgage operation.
Across these three transactions, buyers committed roughly $4.5 billion.
The logic is also becoming clearer. CoStar can connect property data, digital twins, builder software and online marketplaces. Rocket can connect people searching for a home directly with financing. The valuable PropTech assets today are often the ones that own either proprietary data, a recurring workflow or a point in the transaction where money changes hands.
| Buyer | PropTech company | Deal size | What the buyer gained |
|---|---|---|---|
| CoStar | Matterport | ~$1.93B | 3D property data and digital twins |
| Rocket | Redfin | ~$1.75B | Home search, brokerage and consumer demand |
| CoStar | Zonda | $800M | Builder data, software and new-home marketplaces |
| Total | Three deals | ~$4.48B | More control over real estate data and transactions |
If you want more recent data on this point, please see our latest Prop Tech market report.
Which parts of PropTech are still struggling?
PropTech's weakest areas today are capital-heavy housing models, undifferentiated software and startups that need large late-stage rounds without exceptional growth.
Opendoor gives us the most visible example of the first problem. Revenue is still down 44% year over year, despite a recent rebound in home purchases and acquisition contracts.
Late-stage venture funding also remains difficult. CRETI's 2025 research described companies approaching $10 million in annual recurring revenue and roughly doubling sales while still being forced to raise at much lower valuation multiples than they would have received a few years earlier.
The latest funding distribution tells the same story. Investors will write large checks when they see scale, assets or a very clear growth story, while average companies receive much less attention. Nearly half of first-half capital came from 11 financings.
Generic tools face another problem. AI has made software easier and cheaper to build. A startup selling another dashboard to property managers now competes with incumbents adding similar features, specialized AI companies and customers building simple tools themselves.
Growth is concentrating around products that control something difficult to reproduce: proprietary data, payments, a marketplace, a deeply embedded workflow, physical automation or access to a large customer base.
That leaves much less room for the mediocre middle of PropTech than there was during the last funding cycle.
This chart, featured in our Prop Tech market deck, illustrates revenue distribution by customer segment in the proptech market
So, is the PropTech market growing now?
Yes. The PropTech market is growing now, and the evidence from actual customer spending is much stronger than the funding headlines suggest.
The cleanest number we found is the 17.9% combined quarterly revenue growth across CoStar, Zillow, AppFolio and Procore. These companies serve different parts of real estate, yet all four are currently growing at mid-to-high-teen rates.
Underneath that aggregate, several categories look even stronger. Zillow's rental revenue grew 31%. AppFolio is making more money from each property on its platform. Construction tech keeps taking a large share of new funding. AI is pushing real estate companies to increase technology budgets, and specialized automation businesses have reached meaningful commercial scale.
The real estate cycle is helping in some areas, particularly commercial property. It cannot explain the whole result. Zillow grew three times faster than its estimate of the residential property industry while its website traffic declined. AppFolio's revenue is rising much faster than its unit count. Those are technology-adoption effects.
Funding gives us a more cautious answer. Capital came back strongly in 2025, then flattened during the first half of 2026, and the latest monthly figures have been weaker. Large rounds, debt and private equity also inflate the headline totals. PropTech venture capital has stabilized rather than returned to its old boom.
The distinction is now clear enough to make a direct call. PropTech is a growing market today, but the growth is concentrated around property operations, construction software, AI automation, data, marketplaces and transaction infrastructure. Capital-heavy housing models and ordinary software startups are having a much harder time.
So the answer is yes, with fairly high confidence. The PropTech business market is already expanding. The PropTech funding market is only selectively participating in that growth.
If you want more recent data on this point, please see our latest Prop Tech market report.
OUR METHODOLOGY
This analysis tests whether the PropTech market is growing now by separating operating growth from investment activity. We looked at customer spending, company revenue, funding and its composition, technology adoption, segment-level momentum, real-estate activity, profitability and strategic transactions rather than relying on a single market-size forecast.
Revenue received the most weight because it shows whether customers are actually paying more for PropTech. We combined the latest quarterly revenue from CoStar, Zillow, AppFolio and Procore to create a cross-section spanning property data, housing marketplaces, property-management software and construction software.
Funding was treated separately from business growth. We used total capital raised, round counts, large-deal concentration and the share of debt and private equity to avoid treating every financing dollar as equivalent venture activity. European funding was read the same way: higher capital with fewer rounds and extreme concentration is different from a broad-based funding recovery.
Where the property cycle could distort the conclusion, we compared technology growth with underlying real-estate activity. That is why Zillow's growth was considered alongside residential-market growth and traffic, while commercial PropTech was assessed alongside JLL investment data and CBRE leasing and property-sales activity.
AI adoption was judged on both spending intent and execution. JLL's survey data helped establish that real-estate organizations are allocating more budget to AI, while the low share of companies achieving most AI-program goals kept us from treating experimentation as full deployment. Company-level evidence from AppFolio, EliseAI and Higharc was used to see where AI is already tied to specific paid workflows.
We also looked at profitability and M&A because growth becomes more convincing when companies are producing more cash and strategic buyers are paying for the underlying assets. The CoStar-Matterport, CoStar-Zonda and Rocket-Redfin transactions were used as evidence of where buyers see durable value: proprietary data, marketplaces, embedded workflows and transaction access.
Key sources used for this analysis include CRETI's H1 2026 PropTech Venture Capital Report, CRETI's 2025 year-end analysis, MetaProp research, PwC and MetaProp's PropTech Confidence Index, CoStar's Q2 2026 results, Zillow's Q2 2026 results, AppFolio's Q2 2026 results, Procore's Q2 2026 results, JLL's real-estate technology survey work, JLL's global real-estate market perspectives, CBRE's Q2 2026 results, Higharc's Series C announcement, EliseAI's $200 million ARR announcement, CoStar's Matterport acquisition announcement, CoStar's Zonda acquisition announcement, Rocket's Redfin transaction announcement, Opendoor's quarterly reports, and Tech.eu's H1 2026 European PropTech funding data.
This chart, included in our Prop Tech market deck, shows how property management software technology has evolved over time
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