Smart buildings, virtual viewing tools, and digital solutions are examples of technology innovations future-proofing the real estate industry
How is technology transforming the real estate industry? As COVID-19 locked down businesses in the United Kingdom, and 373,000 property transactions – worth £82 billion – stalled, many within the property industry grabbed tech solutions, to film houses to sell and rent, and to communicate with prospective vendors, for instance. Much that was just the start. Now other proptech innovations are being adopted – and about time, too.
The fast-forward button has been pressed on progress across the gamut of business because of coronavirus, and the real estate industry is no exception. “I think for the industry in general, video technology has seen something of a breakthrough,” says Martin Gibbon, owner of Balgores Property Group, one of the largest estate agents in Kent and Essex. “Video technology for virtual valuations, viewings, and mortgage advice has helped drive innovation. The technology, for the most part, already existed, but the industry needed a push to start making it an integral function to its operations.
“I believe the use of technology will become more commonplace for estate agency, to save time on unnecessary viewings and for valuations. This is likely to result in lower staffing levels, and more staff will work from home which could result in fewer offices being needed.”
Iain McKenzie, Chief Executive of The Guild of Property Professionals, agrees. “The housing market has jumped 10 years in technology in 10 weeks,” he says. “Agents have embraced technology and have adapted to using virtual tools in the day-to-day process of conducting business, whether that is managing their teams or communicating with sellers and buyers. The sector as a whole has banded together to help in as many ways as possible, with a large number of suppliers and portals offering reduced or free services to assist estate and lettings agents.”
New tools for the new normal
According to Mr McKenzie, agents have reported to him that through embracing virtual tools to conduct viewings and valuations they have been able to market their listings successfully, and secure buyers. Interestingly, a recent survey conducted by The Guild – which offers a virtual viewing tool – showed that more than half of house buyers would be open to a virtual viewing.
“Virtual viewings would have been considered a gimmick 10 months ago, but because of personal health security issues, these are now becoming a normal estate agency process,” he continues.
“The industry will definitely be a more tech orientated version of its previous self,” adds Mr McKenzie. “The first phase will be tech for the communication and sales delivery process, and I hope it will quickly migrate into shared platforms/CRM systems of key stakeholders, so conveyancers, solicitors, removals, surveyors and the like, all using common platforms that share data and communicate with each other compliantly.”
Violeta Martin, Area Vice President Commercial Sales EMEA of DocuSign, states that digital tools must be taken up in the real estate industry. “The real estate industry needs to find ways to overcome physical restraints and keep their businesses running,” she says. “Real estate deals don’t just happen in an office, and with agreement cloud technologies you can sign contracts from almost anywhere in the world.
“Cloud technologies further enable companies to upload and send documents for others to sign. This replaces manual processes with automated, digital technologies. At DocuSign, we’re striving to ensure that our real estate customers maintain business with as little disruption as possible. Real estate agents might not be able to meet face-to-face with clients and show them around homes any more, but that doesn’t mean that home buying and leasing activity has been curtailed.”
Good working environment – in more ways than one
In addition, the move to sustainable, smart buildings, or multi-facility residential offices in city centres is moving quickly from the realm of fantasy to reality. “The sudden onset and subsequent impacts of COVID-19 have accelerated trends around smart buildings, flexible working, community engagement and space optimisation,” says Dan Drogman, Chief Executive of Smart Spaces.
“In the short term, the industry must come together to put in place viable solutions to get our offices up and running as safely as possible. In the longer-term, property companies must adapt to the changes on the horizon.
“Smart buildings should be a part of the conversation as, without the use of smart technology, strategies would be created based predominantly on guesswork rather than the data and insights that could be accessed.”
Mr Drogman argues that smart technology should play a part in how we adapt our buildings “to suit what will come to be known as the new normal”. He continues: “It may come as a surprise to many how easy it is to implement smart building technology, as often it is seen as futuristic or sci-fi-esque.
“Implementing smart sensors, wireless or voice-activated commands, contactless building entry and quick and effective community engagement, for example, are all strategies which can be quickly embraced at a relatively low cost.
“Smart building technology can also control airflow and air quality, which is a significant area of concern. Not only will buildings that have shut down almost fully require checks for legionnaires for example, but people will be more conscious of airborne germs and want direct control of their environment.”
Rise of proptech solutions
Enrico Sanna, Co-Founder and Chief Executive of Fora, concurs. “Sensors are and will become even more important,” he says. “Not only can they tell you if buildings are being used but also how good of a working environment you are giving to your customers. With an increasingly health-conscious audience, telling people what kind of air quality they are breathing is hugely important.”
When it comes to real estate, and submitting wholly to technology, there are likely barriers, however. John Slade, Chairman of the Real Estate Advisory Group at Duff & Phelps, says: “Due to the large sums of money involved in commercial transactions, and the importance of the context of the location and their surrounds for these purchases, it is unlikely that buyers would be converted to buying remotely.”
This chimes with Mr McKenzie of The Guild. “Estate agency is and always will be a people industry,” he concludes.
That point may be true, but technology is transforming the property industry to make it better for everyone.