A new order has dropped into the property-scape, ushering in a new dawn for the sector. Christened Proptech, this new amalgamation of real estate and technology is changing real estate and changing it for good.
The real estate sector has been the sunshine sector of India for a long time. A lot rides on real estate and its health is benign for the economic growth of the country. With attractive assets mushrooming in every corner of the country and real estate property prices touching new heights, market players were forced to scour for new business models and ways to optimize expenses. Add to that the changing expectations of the tenants, property buyers and the distress looked more pronounced.
Technology looked like the last resort to address this dire strait. And the inevitable happened. A deluge of tech innovations upended the real estate sector, breathing fresh air into how property is occupied, managed and transacted. They were collectively known as Proptech.
The Proptech phenomenon saw the light of the day back in 2008 when a paltry $20 million were invested in proptech startups. This slowly rising trend made a windfall in 2018 when an innovation rush captured the global market. Today the size of investment in Proptech startups has surged to $24.6 billion in 2019.
It is no secret that real estate was a late comer to the innovation sphere, but it is trying its best to play catch up for the lost time. Proptech is taking an expansive approach by dismantling hackneyed pillars of real estate business and ushering new fundamentals that address our growing demand for affordability, flexibility and community.
While the Proptech trend started with property listing businesses, it gradually upped its ante with full stack and transaction closure capabilities. Of late, the tech pointer has shifted towards the disruptive territory fuelled by Artificial Intelligence (AI), Augmented Reality (AR), Internet of Things (IoT) and Big Data.
Today real estate is wired to these technological bigwigs. Real estate companies are game to adopt intelligent cloud and data-based management solutions to provide an edge to their businesses and finetune the experience of customers. And guess what, proptech is triggering earthquakes in real estate markets around the world.
It’s almost 2020 and proptech is already impacting our homes, work-spaces and cities in a huge way. Home-buying has graduated to a new echelon. Online home-buying assisted by pre-virtual tours and mortgage tech has become the new age shopping mantra.
More exciting things are arising on the horizon. Blockchain and smart contracts are adding a new dimension to real estate. They are mitigating the risk of buying and selling and drastically cutting transaction times. And who knows, property buying one day may be as easy as grocery shopping.
The rise of co-working spaces is disrupting the way people are renting offices. Co-working start-ups like WeWork are giving businesses the option to hire office spaces by the hour or by the month. This makes for efficient utilization of working spaces and at the same time brew a sense of community and networking opportunities too.
Co-living is another chip off the proptech block. Young professionals, students and first-time renters are ditching the asset ownership route for something more affordable and practical. And co-living start-ups are helping them right-size their wishes to something broadly attainable.
Proptech is paving the way for smart buildings that are more energy efficient to run. Businesses are using sensors and IoT to analyse people’s movements, making buildings much smarter. Smart cities are becoming governments’ new agendas and proptech will make it happen big time.
Technology is churning out new innovations to add some zing to real estate. Spatial mapping robots watching over construction sites and drones flying over the sites for project reconnaissance is what the future of real estate looks like.
With tech companies sprouting everywhere, it is fair too say that housing will transition from a product into a service and customers will avail them at the click of a button. Keep watching the crystal ball!