PropTech: Technology for Real Estate Transparency, By Inyene Ibanga
TECHDIGEST – Technological innovations have eased the way things are done across the work-life environment globally. Every facet of human activity is becoming increasingly powered by digital technology.
As it is obtainable in diverse industries, technology is also impacting the growth of the real estate or property industry in many different ways.
The property/real estate sector was initially slow to embrace digital transformation. However, with its realisation of the contribution of digital technology in other industries, property/real estate companies are gradually leveraging emerging technologies to reform their industry.
Today, the alignment between property management and technology has given rise to the fast-growing global proptech industry.
Proptech, also known as realtech, stands for property technology and refers to all the software, tools, websites, apps, and other digital solutions used by real estate professionals to optimise buying, selling, researching, marketing, financing, and other real estate activities.
As indicated above, proptech simply refers to the usage of technology and software to assist in real estate needs. These include those of landlords, tenants, investors, brokers, marketers, repair workers, maintenance teams, and property management companies. Proptech also covers smart building technology, space management, and architecture.
The implementation of proptech tools, processes, and strategies is helping to improve the value and performance of real estate and the whole property management ecosystem.
Artificial intelligence (AI), virtual reality, big data, and analytics are some of the trends revolutionising the proptech market to enable buying, selling, renting, or managing property.
Virtual reality and inspection drones make it possible for owners, buyers, and investors to visualise or inspect a property without physically stepping into such property. It enables remote transactions and digital contracting that make the customer experience easier and faster.
The use of artificial intelligence, through networks of smart devices and sensors (IoT), helps to power the marketing and investment processes.
Also, proptech solutions facilitate the ease of data collection, automation of paperwork, and cost reduction, and to open more opportunities for business growth, deliver more value to all parties and drive quality communication among landlords, tenants, and estate agents.
FinTech Global reports that the value of proptech companies was $7.1 billion, after the slump in 2020 due to the lockdown all around the world.
A few notable global protech companies are HomeViews (London), Acaboom (London), Ohmyhome (Singapore), Casavo (Milan), McMakler (Berlin), and Knotel (New York). (San Francisco), Divvy (San Francisco), and Homeday (Berlin).
In Nigeria, Fibre, Rumi, Eden Life, Estate Intel, Rent Small Small, Spleet, Property Deal Zone, and Yahshud Property Investment are among the popular proptech industry players.
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These companies are making the real estate sector more accessible by simplifying the process for buyers, sellers, investors, and other parties to engage conveniently. They are now enhancing the services in the property technology space with innovative, efficient solutions.
But the lack of transparency constitutes a major anomaly facing the global property/real estate industry. The introduction of proptech in real estate has put greater demands on the need for sustainable transparency and ethical practices.
Property investors, developers, and governments at all levels are beginning to recognise the imperative of real estate transparency to the urban environment.
Real estate transparency is an essential ingredient of a well-functioning economy and society, because the industry focuses on one of man’s greatest needs: Shelter.
Real estate transparency attracts new investments and business activity to a city, helps government and other key stakeholders make smarter decisions about infrastructure, and enables sound long-term planning.
Global real estate services company, JLL, defines a transparent real estate market as one in which stakeholders have ready access to high-quality market and performance benchmarks; where there is certainty, consistency, and rigorously enforced rules and regulations exist.
In this setting, corporate governance standards are found to be robust, and real estate transactions are carried out fairly and ethically.
According to JLL Global Real Estate Transparency Index, 2020, London occupies the top spot as the world’s most transparent real estate market. Los Angeles, San Francisco, Sydney, and Washington DC round off the top 5.
Surprisingly, the global top 20 includes several small-to-mid-sized second-tier anglophone cities like Seattle, Denver, Brisbane, and Manchester, with Paris being the notable non-anglophone city.
Real estate transparency in Nigeria is lacking due to the activity of quacks and fraudsters parading as real estate agents in the urban centres.
These unscrupulous individuals have been using the low digitalisation in real estate operations to perpetuate their criminal acts.
Stakeholders such as Real Estate Developers of Nigeria, the Nigerian Institution of Estate Surveyors and Valuers, and others, would do the sector plenty of good by encouraging registered companies to adopt new technologies that are digitalising their operations.
Apart from efficiency, digitalisation would ensure the security of digital documents through the deployment of blockchain technology. This will minimise the incident of forged/fake documents used to defraud clients’ and landowners, thereby safeguarding the interest of stakeholders across the sector.
The National Information Technology Development Agency (NITDA) should engage with real estate professional groups, public and private stakeholders to streamline innovative solutions that can be safely deployed to ensure transparency.
With the guidance and support of NITDA, tech developers and innovators would be empowered to give priority attention to the creation of innovative digital solutions for the emergence of more proptech startups in the country’s real estate industry.
In the long run, digital transformation of the property industry would promote engagement between PropTech and property businesses, while also providing opportunities to network with property professionals and technology investors.
Inyene Ibanga is Managing Editor Techdigest and writes from Wuye District, Abuja; email: [email protected].
