Welcome to the second article in our series exploring Said Business School’s first property research report, Proptech 3.0: the future of real estate.
As we said previously, 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, last week we looked at the background to the report by professor Andrew Baum, visiting professor of management practice at the University of Oxford’s business school.
In this article, we examine five future trends to expect in the residential property market:
- The human factor will triumph
- The hybrid agency model may be a sign of the future
- Success lies in a firm’s ability to solve problems
- The lettings market is in line for repair
- Blockchain technology could revolutionalise the property market
Online-only agency business models will not usurp traditional agencies. In fact, professor Baum believes that the human factor will reassert itself in a variety of ways, and that traditional business models capturing technology for their own benefit will retaliate and challenge purely digital propositions.
Start-up agencies, such as Purple Bricks, which combine human and digital interfaces, may be a sign of the future. The fact that the agency raised over £100 million in venture capital funding between its launch in 2014 and the publication of professor Baum’s report in April 2017, highlights investor confidence in the business model.
Professor Baum predicts that the Proptech companies most likely to survive will be those focused on delivering products that bring efficiency and alignment to the property market.
According to professor Baum, the residential lettings market is characterised by risk and inefficiency because of the risk posed in part by untrustworthy tenants and unsuitable landlords, and therefore in line for repair.
In a nutshell, blockchain technology can be thought of in terms of a vast, secure database, which is shared and accessed by a network of users, rather than one centralised administrator. It was originally developed for digital currency-based transactions using bitcoin. In the context of the property market, blockchain technology involves the use of a single database comprising clean, unduplicated data referenced to individual properties and accessible by all parties involved in each property transaction. It replaces the current scenario whereby multiple parties – including agents, lawyers, local authorities and banks – manage multiple data sources, which are often difficult and timely to access. Of course, the technology relies on the aforementioned parties inputting all relevant data into the shared network, rather than only their own database, so it may be some time before the UK property market adopts such revolutionary technology on a wide scale. Nevertheless, it’s definitely one to watch given that the world’s first property was last year sold in the Ukraine using a blockchain.
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