The real estate sector is experiencing a new bubble, but this time it is not speculative. The technological revolution has reached the industry and 2018 is expected to be the year of the definitive explosion. Real estate digitalization has accelerated through the proptech.
The concept, like the fintech or the insurtech, is born from the union between technology and the real estate sector. It is real estate 2.0 within an industrial revolution 4.0.
A field of activity composed of startups that bring value to the real estate world through technological components and large companies increasingly interested in adapting these developments for their own benefit.
Despite the traditional conservative image associated with the real estate market, there are many companies of great significance that open their doors to innovation. Not only adapting to the most imperative changes, but also betting on incubating or entering funding rounds of startups that try to apply tools such as home automation or big data.
The possibility of collecting data for daily use through sensors in offices or large retail stores, for example, can help optimize space and energy consumption. But the jump of the sector is not due to an isolated technology.
The sum of tools and innovation is the key to this renewal. The smart devices equipped with «the internet of things» and even the blockchain technology have a place in a vibrant market where companies devoted to software development, such as Citygrum, lavish themselves.
Non-traditional agencies and alternative investments
The most obvious signs of this change come through the market places or portals established as Idealist, Trovit or Fotocasa, which practically monopolize the rental of flats.
The scope of the proptech, however, is much wider and beneficial, especially for the end user.
In Anticipa Real Estate, the largest rental manager atomized in our market with more than 12,000 leased properties, it is clear that digitization has fully reached the real estate sector.
«We want to put the tenant at the center of our activity and offer a 100% digital experience from the search of the home to the signing of the contract» says Eduard Mendiluce, CEO of the firm. «For this we have developed a tenant portal through which, in a first phase, you can already make the reservation of the apartment, sign the contract and pay receipts through a payment gateway, among other features.»
Mendiluce insists on the idea that technology and digitalisation must work to offer better services to customers: «In short, it is about offering the tenant global services that involve an improvement in the management of his house, and help strengthen the link between the person and Anticipa Real Estate, based on the latest trends such as smart-contracts supported by blockchain technology «.
Another factor to take into account in this paradigm shift is the growth of investment platforms such as Housers or Inveslar, which put at hand the purchase of assets with amounts of money that can start at 50 euros. Crowdfunding transferred to real estate.
From tourism to residential
The tourism sector is one of those that has taken advantage of this pull through peer to peer applications such as Airbnb, Niumba or HomeAway, whose appearance has caused institutional chaos but also the birth of intermediary companies that manage these rentals.
The phenomenon, however, has not been there and is also noted in the residential sector. CBRE is one of the strongest companies that has opted to join this change, which requires a time of learning but which they see as the natural response to a transformation in all sectors.
«It is a trend in all sectors and it is logical that it be applied in real estate», says Carlos Casado, COO of CBRE Spain. «Whether at work, at home or in the gym, we spend 90% of our time in buildings and these must adapt to current demand.»
For the manager of the company, technology is benefiting especially in two ways: the marketing through more optimized tools, and the collection of data that can help both to make buildings that respond to a real use and to invest with much more information at your fingertips.
«It is a good change for all the components of the sector and that is energizing it. At CBRE, we have to identify the new ideas and make them available to our customers, so we dedicate our efforts to researching them and identify new opportunities through our proptech challenge, «says Casado.
A network that benefits each other
This revolution does not imply the rupture of the traditional real estate, but a necessary evolution to whose train in march they are adding more and more companies.
In Spain we are in a phase of exploration and we begin to settle, to consolidate ourselves. According to the latest analysis carried out by Savills Aguirre Newman together with Finnovating, there are more than 200 companies dedicated to proptech at the moment.
«We started talking about proptech when it was not taken into account, and today we have identified and work with some 180 companies that add value to the real estate market in different sectors,» says Ignacio Martínez-Avial, director of the digital area of Savills Aguirre Newman
«It is important to generate synergies between startups and corporates, create industry,» Martínez-Avial continues. «Publicizing the different brands working under this model and disseminating their processes helps improve the business. We have to bet on modernization. » Savills Aguirre Newman organized in 2017 a proptech congress in which 80 SME CEOs were willing to share ideas and challenges of the sector.
New business models
The boom of the proptech is undoubted and in its wake are created not only new companies willing to be part of the wave, but also platforms that serve as laboratories of ideas and entrepreneurship. This is the case of NeinorLab and NeinorNext, initiatives of Neinor Homes that aims to channel an unstoppable movement.
«If we had to combine the digital transformation, it would be imperative,» says Lucas Galán, director of product and innovation at Neinor Homes.
«Real estate has to merge the physical and digital world to transform both the sector and society, and in that process any element within the value chain. In a few years we will not design, we will not come, we will not buy or finance as has been done up to now and consequently we have to make our business model more efficient, «he reiterates.
The optimization of the operations of the company, the reduction of costs or the improvement of the relations with the client are some of the factors that will improve thanks to the proptech, in the opinion of Galán. The real estate world is progressively mutating, looking towards a future that will represent a new leap for society.