Eurolink closely monitors market innovation, so it can reflect new market trends in its software, Veco™, while keeping you up to speed with how these trends might impact your business.
In line with this, throughout the coming weeks we’re going to explore Said Business School’s first research property research report in a bid to help you understand the possible future direction of the property technology market.
Andrew Baum, author of the report, entitled Proptech 3.0: the future of real estate, and visiting professor of management practice at the University of Oxford’s business school, interviewed 50 property professionals, entrepreneurs and investors, who collectively helped him form the opinion that 2017 was a turning point for technological change in the property sector.
Property technology, or ‘Proptech’ as it’s been dubbed, involves the use of technology to develop the property market, and it’s an emerging sector rich with opportunity for market players, thanks to the billions of pounds being invested by savvy investors.
But professor Baum recognises major challenges at play, such as the suggestion that property professionals aren’t good at strategy and are determined to protect inefficient fee-earning practices at the expense of innovation.
In this article, we present five key findings:
- We’re in the midst of Proptech 2.0
- Entrepreneurialism is rife
- There’s huge opportunity for change
- Fundraising has been vast
- But there are major challenges to overcome
Proptech 1.0 was characterised by enterprise services, including software for analysing and managing property investment, while Proptech 2.0 comprises online residential property businesses, such as the property portals and, more recently, hybrid agencies such as Purple Bricks, which combine human and digital interfaces.
There has been a surge in innovation in the property market, which is being driven by breakthroughs in technology, including cloud technology, leaner coding, mobile devices and sensors.
The property market is one of the last to adopt such technological change and the associated benefits. The enormity of the market and the inefficient processes and unnecessary transactional costs at play present a massive opportunity for investors and entrepreneurs alike.
CB Insights, a technology intelligence platform, suggests that Proptech companies have raised almost $6.4 billion (£4.7 billion) in funding across 817 deals since 2012, highlighting investor confidence in the market.
The report suggests that self-interested individuals, including chartered surveyors, brokers and lawyers, often resist technology-driven innovations due to an assumption that they are designed to ‘disrupt’ their work. Further, there are opposite forces at work: while the property sector may be crying out for modernisation, we now operate in an economy that values conservatism, modest fee structures and better governance following the financial crisis, so where does that leave entrepreneurs and their appetite for change?
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