While the technology revolution in the financial sector is commonly referred to as “fintech” the same revolution in the real estate sector is referred to as “proptech”. It is fair to say that the real estate sector has been a little slower in acceptance of disruptive technologies but many experts believe 2019 could be the tipping point. A report by PwC shows that the combined Canadian and US proptech sector was valued at US$4.6 billion in 2016. In 2017 this increased to US$7.3 billion and experts believe there will be a significant increase for 2018.
Printers, scanners and fax machines are history
We live in a world where time is money and this is a growing characteristic of the real estate sector. If a real estate agent is not able to respond to a query in a matter of minutes the lead will likely be lost. We are even seeing the emergence of artificial intelligence in the form of chatbots which are available 24/7 to answer online questions. Ask your real estate agent when they last sent a fax and you will see how far technology has come!
Proptech – Adapt or die
In many ways smart phones and tablets are the key to a more efficient and fast-moving real estate sector. They offer an array of services such as:
• Digital signatures
• Screen shares
• Property slides
• Live web cams
• Virtual meetings
There is no need to print out reams and reams of property agreements and send them by snail mail. Buyers, sellers and agents can now read these agreements online, use their own secure digital signatures and the deal is done. Funds can also be transferred online in an instant!
Aside from the new technologies now available to real estate agents the actual building and management of property is changing. Artificial intelligence is being used to operate heating and lighting in the home and we are also seeing the emergence of 3D printed homes. These are the types of technology which were not even a dot in the future just a decade ago. They will now become more commonplace across the property management sector and as with real estate agents, it will be a case of adapt or die.
Is there a role for traditional agents?
Amidst the push to further utilise new technology and develop new systems in the future, it is easy to forget the role of the traditional real estate agent. Despite massive progress with artificial intelligence the chatbots cannot answer subjective queries despite their skills in answering factual queries. In time chatbots will no doubt learn how to be more subjective, answering different styles of questions, but it is unlikely they will ever take over from an agent.
The introduction of standard legal agreements will reduce lawyer’s fees, artificial intelligence will reduce human input to a certain extent and more focused advertising (using smart phones and tablets) will likely reduce advertising costs. In theory this should lead to a reduction in overall real estate transaction charges but is there a downside?
Those in favour of a more balanced mix between human/technological influences in the real estate sector will claim you get what you pay for. If you cut corners there may be consequences, if everything is automated are there sufficient checks being carried out? Those looking towards maximum technological influence in the real estate sector may rue the day they discounted human input, networking and good old-fashioned experience. Can proptech barter like the agents of yesteryear?