PropTech... current trend or the future?
You know when a trend has risen and become duly established. It’s the point at which it gets its own moniker. We’ve had ‘fintech’, a term used to describe the glut of financial technology. Now we have ‘proptech’, which is for property what ‘fintech’ is, and has been, for finance.
Its definition lies in its reference to startups that develop new technologies for the property business. Having said that, it’s also been described as the next big thing in the construction and property industries.
In its simplest form, the word ‘proptech’ stands for the varying types of technology out there and our changed mindset in terms of how we interact.
It’s widely acknowledged that technology has infiltrated all our worlds over the past couple of decades, blending home and work, and social and professional, while providing easy access and better communications, globally, across all sectors.
Technology set up home in property a while ago and both those in the market (using the term broadly, to cover residential and commercial), and those who are served by the market, generally now use it as a ‘go to’.
It’s a given that most technologies impact the property business. A most obvious example of this is the buying and selling of property…
Twenty years ago, if you wanted to sell a house, your best tool might be the estate agent’s window coupled with an ad in the local press. Similarly those looking for property would be at the mercy of the same local rag and the estate agent’s opening hours to pick up a set of specs.
Now, we have sites like RightMove and Zoopla along with the estate agents’ own websites. The reality is, most property searches start on line. These websites can run any number of pictures of properties, including photos taken from every angle. A picture paints a thousand words – and you can have as many as you like!
Not only that but, as we all have smart phones, we can access those pictures any time and anywhere we like. The whole process of shopping around for property has been opened up – and that goes for commercial property too.
As far as residential goes, online agencies like Purple Bricks, who charge a flat fee rather than a percentage of the sale price, are quickly growing their market share. Some of the bricks and mortar estate agents are looking a bit tired and the majority of them are working for a fast sale. The standard model no longer fits all – and this is where Proptech steps in.
It works for rental as well as buying and selling too. There are now management companies on-line that offer landlords a way to manage their own properties for a fixed fee. There are also proptech platforms that offer direct investment in commercial property, allowing investors the opportunity to diversify in the type of spaces they choose to invest in, with properties that offer a stable, long-term yield.
One thing’s for sure, these proptech companies are providing a level of transparency that the property industry hasn’t seen before and, for the customer, such transparency can only be a good thing.
In terms of the agents, if both residential and commercial property professionals can view the technology as useful tools that will help them raise their game rather than focusing on any negatives, there’s room for everyone to win.