When big investors set their sights on a particular tech scene, it’s usually a good bet that huge change is coming.
One such area is proptech, and as Gulf News outlines, the interest of the world’s biggest real estate venture capital firm Fifth Wall in the sector is a huge signal of intent from investors the world over.
Proptech is already causing fundamental changes in how real estate is dealt with, from the introductory measure of home financing, through to the process of real estate value identification and development opportunities.
Proptech in financing
A key area of proptech investment has been in the mortgage acquisition process. Digital mortgage lenders have created an environment for borrowers in which they can exert more control over their borrowing and have a clearer picture of what they can afford; furthermore, fees have been reduced and the cost of administration slashed.
This, according to TechCrunch, has been one of the biggest benefits of the proptech revolution. Mortgages drive forward the property industry; far more homeowners obtain property through taking out these loans than any other method, not least direct purchase.
As a result, improving the process for this huge chunk of the market will create clear and appreciable benefits for the wider real estate industry.
Restoring construction
The American housing market took a topsy-turvy look on in 2021, driven by huge prices and shortages in building. Cutting through this malaise and creating a more flexible environment for creating new housing is something driven forward by proptech.
Crunchbase in particular have highlighted the work of construction project management proptech in helping ailing construction firms to get back on their feet and start working again. The technology has an ability to create transformation where it didn’t exist before, and bring old-school industries into the modern day.
This is, inevitably, good news for the wider real estate ecosystem, and something that the industry as a whole can rally around.
Predicting the future
Perhaps the most exciting development in proptech, if controversial, is what Reuters have highlighted as the development of ‘property analysis’ features.
Using a range of data sets related to economic and social indicators, property developers in London are using high-tech tools to predict where the next improvements in land quality are set to be, and are snapping up land and property to renovate and then sell on for a hefty profit.
There is controversy in this work, as it can be considered a form of proactive gentrification, but for the world of real estate knowing where the next hot-spot is going to be is an absolute blessing and a way to generate real profits for savvy tech-smart companies.
The future of real estate is going to be one based on this technology. From building the properties, to selling them, to estimating where the next areas of high value are going to be, proptech is shepherding in the future. Companies that embrace tech, rather than rejecting, stand to gain the most.
