Real estate companies have ramped up their Proptech investment in response to the COVID-19 pandemic finds new survey
Real estate companies have ramped up their Proptech investment in response to the COVID-19 pandemic, finds a survey of some of the biggest property players in Asia. The survey by independent news source Mingtiandi, in collaboration with technology company Yardi Systems, finds 70 percent of real estate companies are scaling up their Proptech investment.
The results of the survey, Tech adoption in Asian real estate, builds on a similar report from Mingtiandi in 2017. Proptech is the abbreviation of Property Technology.
“Our latest survey results unearth a major shift towards proptech adoption in our region,” says Yardi’s Regional Director, Bernie Devine.
“Change was underway well before 2020, but COVID-19 has heightened the urgency and amplified the risks of inaction.”
Proptech investment will deliver billions-of-dollars in value to real estate sector
Proptech – innovative technology that reimagines property’s core processes and business models – is turning real estate on its head. Metaprop, one of the world’s largest early-stage proptech venture capital firm, predicts that proptech innovation will deliver $205 billion of new value to the global real estate industry over the next five years alone.
“Real estate leaders are rolling out technology to support more frequent and accurate reporting, deeper data analysis, and technology that underpins safety and efficiency,” Devine explains.
A total of 180 real estate specialists – more than a third with assets valued at over US$1 billion – took part in the survey in August 2020. Thirty-nine percent of respondents were from Hong Kong, 26 percent from Singapore and 12 percent from China.
Among the key findings, 35 percent said Asia was still trailing the West in terms of Proptech investment, but this was down from 56 percent in 2017. Thirty percent said the region was leading the way – up from 12 percent three years previously.
“There’s a growing perception that Asia is closing the gap with the West. Location shapes perceptions more than any other factor, with just six percent of respondents in mainland China believing that Asia lagged the world’s leaders,” Devine says.
Respondents named big data analytics (55%), artificial intelligence (42%), business process automation (32%) and the Internet of Things (32%) as the top technology plays for Asia’s property industry over the next five years.
However, Mingtiandi’s survey also suggests some quarters of the real estate sector remain skeptical of the power of technology as an agent of change, with 77 percent believing real estate trails other industries.
The region’s real estate companies, many of them family-owned, are still slow to adopt new tools for Proptech investment. In the era of big data, 56 percent are still reliant on Excel spreadsheets for their work processes.
“But as we start to achieve far superior levels of efficiency and insight from more sophisticated software, digital will dominate. We expect the property companies that seize the lead now will establish an unassailable position in the market in the years ahead,” Devine concludes.
Mr Paul Ho, chief officer at iCompareLoan, said, “proptech adoption is a must in this time of pandemic. The value-added real estate solutions promised by proptech adoption points to the signs of the times. Property services firms and agents must upgrade to keep up with technology or they must die.”
He noted that many property agencies struggle to keep up with all the regulatory changes in the industry, as well as the changing financial calculations for acquiring a property. He urged property agents to master the basics in property financing, refinancing, taxation and CPF.
Mr Ho said that iCompareLoan.com runs a full 2 – 3 days course on how property agents can produce such reports for their customers. He added that the trademarked course teaches Property Agents how to generate complicated Financial calculations using – Home Loan Report (TM) – in 3 mins flat. This helps Property agents to close deals faster and serve customers more professionally.
The Home Loan Report tool is a Singapore’s first one-of-a-kind analysis platform that provides latest updates of detailed loan packages and helps property agents, financial advisors and mortgage brokers to analyse home loan packages for their clients and give unbiased home loan / commercial loan analysis for their property buyers and home owners.
Proptech is technology and real estate coming together to propel the real estate industry forward. The proptech ecosystem is flourishing now in many parts of the world, thanks in large part to ample venture capital, community efforts in local tech hubs, and an increasing realisation that there is a real need for innovation in the sector.
Proptech is all set to not only impact, but also disrupt traditional business operating models in real estate. Proptech (short for Property Technology) is a term which refers to the myriad of startups and new technologies cropping up in response to decades of inefficiencies and antiquated processes in the real estate industry.
Looking at the relentless wave of innovation in the past decade, it is not surprising that this trend will sweep over real estate, an age-old industry ripe for disruption. We know that a trend is established when it becomes a noun or verb on its own. Terms such as Googling, social media, fintech and proptech did not exist 10 years ago, but are now exoteric and commonplace.
Proptech is technology and real estate coming together to propel the real estate industry forward. The proptech ecosystem is flourishing now in many parts of the world, thanks in large part to ample venture capital, community efforts in local tech hubs, and an increasing realisation that there is a real need for innovation in the sector.
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