Proptech venture funding dropped sharply in the second quarter of 2026, according to the H1 2026 Global Proptech Venture Report from the Center for Real Estate Technology and Innovation (CRETI), reported by Bisnow on July 8.
The half-year total looks steady on its face. Proptech companies raised about $4.53 billion in the first half of 2026, roughly even with the $4.56 billion in the same period a year earlier. The quarterly split tells a different story. Second-quarter funding fell to about $1.3 billion from $3 billion in Q2 2025, a 57% drop, after a $3.25 billion first quarter. CRETI noted that Q2’s entire haul came in below what the sector raised in January alone, more than $1.7 billion.
The money that did move concentrated at the top. CRETI counted 231 disclosed rounds in the half, but 11 deals of $100 million or more accounted for nearly half of all funding, led by Terralayr’s $412.9 million round and Mews’ $300 million Series D. The 75 deals under $5 million made up 2.8% of the total. Debt made up 27.7% of the funding, ahead of venture capital at 18.3%. “A period with large debt financings may show strong funding volume without necessarily indicating increased early-stage venture risk appetite,” CRETI wrote.
Where capital is moving, it’s moving toward AI. PitchBook data shows AI-focused proptech companies grew funding at a 42% annualized rate in 2025, nearly double the 24% for non-AI peers. Even so, first-half 2026 funding sits about 65% below the sector’s 2021 and 2022 peaks.
