‘Proptech’ – Just Another Buzzword?
Property Technology, or ‘PropTech’, is an increasingly used phrase within the housing sector. Following suit from similar buzzwords, such as ‘FinTech’ and ‘InsureTech’, PropTech refers to the technology solutions and innovations used by the property industry.
One of the best definitions comes from LendInvest who define PropTech as, "the wave of companies using technology to refine, improve or reinvent the services we rely on in the property industry to buy, rent, sell, build, heat or manage properties".1
There are two main driving forces behind the growth in PropTech – the ‘internet of things’ and changing consumer habits.
The Internet of Things
The Internet of Things (IoT) refers to physical devices which connect to the internet, and to each other, to transfer data. IoT technology can help improve the construction and safety of property. Examples of this could be drones to conduct site surveys, or software to detect and undertake structural analysis. Both services would not be possible without the presence of IoT applications.
IoT devices can collect, transfer and analyse massive volumes of structured and unstructured data, known as big data. Such data is utilised by firms to provide innovative solutions across the property sector, aiding the buying, renting and selling of properties. This in turn has led to the emergence of digital disruptors such as Rightmove, Zoopla and Purplebricks. The rate at which these companies have grown illustrates just how dominant this force can be.
Changing Consumer Habits
The second driving force behind PropTech can be attributed to the changing nature of consumer habits. In an age where more people are turning to the internet rather than their local high street in their search for a new home, technology in the digital sector has naturally increased its presence. Consumers are demanding greater choice in a shorter amount of time, allowing for the existence of the start-ups mentioned above. Not only has PropTech allowed for more consumer choice, it has simplified the buying process. Online and virtual viewing is now available at the touch of a button.
With the growth of the internet and the constant changing of consumer habits, it appears PropTech is here to stay.