Proptech is the new catchphrase making rounds in the real estate industry. This modern technology is a driving force of innovation. It is acting as a contemporary cure for the real estate companies which put up stacks of paperwork and high-flow asset classes for investors looking for new opportunities. Proptech is completely transforming the traditional real estate journey including selling, buying, investing, and searching. Therefore, it is captivating the interests of investors, developers, and real estate agents around the world. Today, the real estate industry as well as investors can benefit from Proptech in multiple ways as it provides profitable opportunities and innovative tools which add to the efficiency of the whole real estate process. Increasing transparency, chatbots, effective communication, and easy marketing of real estate products are boosting investments in this sector. The real estate sector which was lagging in technological transformations has now completely revolutionised itself with the help of Proptech as it is the future of innovative development and growth.
The situation of the Real Estate Sector of Pakistan
Real estate in Pakistan is one of the largest industries in the country with great potential. This sector is slow to technological adaption and innovation. Since the majority of Pakistan’s population is tech-savvy with 82.90 million internet users and 71.70 million social media users (Kemp, 2022). This population prefers e-commerce in all socio-economic sectors instead of conventional methods. Therefore, like other industries, the real estate industry of Pakistan also adapted to technological transformation which paved a way for Proptech in the real estate market. This technology is revamping both the real estate and IT industry in the country leading to economic prosperity and development.
In the past, the real estate sector of Pakistan was marred with malpractices such as false property listings, illegal housing schemes, and false documentation and verification. The investors did not have access to a transparent real estate database. They had no other choice but to go with the word of mouth of the broker. Even today, 40% of the real estate revenue ends in dead capital due to a lack of regulatory authorities and transparency (BR Research, 2021). Such practices increased land-related court cases and reduced investment meant in the real estate sector of the country. However, Proptech is changing the way the real estate sector operates. Investors can track and verify all the property, access required information, and communicate with advisors through their mobile phones within the comforts of their homes. This technology has introduced a transparent and hassle-free real estate experience for investors.
Today, the availability and use of the internet are steadily increasing the use of Proptech in the digital real estate of Pakistan. However, this technology is not utilised to its full potential. The ongoing climate crisis in the country has made prospective clients’ environment conscious. Since a larger portion of online home buyers in Pakistan is constituted of millennials, they look for convenient, efficient, and modern apartments. Moreover, sustainability in the real estate sector is a significant factor for these global and local investors. Therefore, real estate companies in Pakistan should use Proptech to develop smart and green buildings which are environment friendly. These developments have modern features like automatic controlling and functioning of resources . Building’s carbon emissions are also reduced which increases the asset’s value and sustainability. Pakistan’s real estate future is progressive only if it adapts to the changing market trends. Therefore, incorporating Proptech technology in this sector is a vital need. Since Pakistan’s economy depends on its real estate sector, its complete technological transformation is the key.
Emerging Proptech Trends
The Trend of Virtual Home Tours
The recent pandemic has sped up the technological transformation of the real estate sector and made people increasingly dependent on technology. Today, they prefer online real estate over traditional methods. This fast-paced generation doesn’t have time to physically view the house or property. Therefore, the demand for virtual tours of houses and properties is rapidly growing its trend in the Proptech domain. As a result, real estate agents around the world are relying on virtual tours to grow their businesses. For example, the world’s leading real estate Company Zillow has added 3D features with the help of Proptech that gives the viewers a peek at the home’s layout. This feature allows the buyers to interact with and design floor plans as well. Moreover, Proptech has also introduced the Matterport feature which enables prospective buyers to view the inside of the building in all dimensions from their mobile phones.
E-Signing is becoming Mainstream
Dealing, organising, and going through piles of paperwork is a hectic task for both the real estate agents and buyers. However, Proptech has made E-signing mainstream in the real estate industry. The global digital signature market size is valued at $3.56 billion in 2020 and is expected to reach $61.9 billion by 2030 (Borasi, Khan, Kumar, & Yogendra, 2021). Buyers, sellers, and agents only need a smart device with an internet connection to sign on the real estate documents. E-signing has sped up the real estate process. For example, mortgage transactions, deed recording, and real estate sales can take place instantaneously without the physical presence of a buyer or seller. Going paperless ensures flexibility and saves money and time for both relevant parties.
Growing Demand for Smart Homes
The new generation of millennials and digital natives are setting up new trends in the real estate industry. These tech-savvy individuals prefer sustainable and affordable homes in urban locations to match their fast-paced lifestyles. Therefore, real estate companies are transforming traditional homes into smart homes to increase property and value and attract this generation. These smart homes with the latest technological features like voice automated sensors, cameras, and services are becoming a standard. The global smart home market was valued at $99.89 billion in 2020 and it is expected to grow up to $380.52 billion in 2028 (Insights, 2021). The reason for this is growing internet users, job security, environmental awareness, and growing demand for low carbon emissions and clean energy sources.
Exclusive Advertising Solutions in the Real Estate Industry
Innovative advertising platforms are making their way to the digital real estate sector to provide unique solutions. These platforms can provide real estate professionals with an advantage over their competitors by improving and personalising the real estate experience for their prospective clients. For example, Nextdoor is a social networking application where users can interact and communicate with each other. Real estate companies are using this app to sell real estate products and build a brand identity for themselves. This app is currently operating in more than 11 countries reaching 295000 neighbourhoods worldwide (next door, 2022). Apps like these can be used by real estate agents to create an online presence and grow their business on international forums.
iBuyers are Growing
Traditional real estate processes are slow, tedious, and complex. Therefore, they are being replaced with iBuyers. An iBuyer is a company that makes an offer on a home or property instantly with the help of technology. This process is more convenient and simple as compared to a traditional home sale. iBuyers are accelerating home sales in the real estate industry. Since they completely rely on online data, an unseen home might go on sale as well. For example, selling a home through traditional real estate may take up to 2 months whereas, most ibuyers will make an offer and complete the selling process within 2 weeks (WHITT, 2022). Therefore, they are growing popular among homeowners.
Short Term Strategies
-
The government should provide incentives to the real estate industry to increase the pace of technological adaption in this sector.
-
The government should encourage and raise awareness regarding the importance and necessity of innovative technology in businesses.
-
The government should promote e-commerce channels in processes like buying, selling, and investing which might help achieve a cashless payment system in the future
Long Term Strategies
-
The government should develop a regulatory authority that secures and protects the personal data of investors in the online space.
-
The government should make a unified database which must be transparent and shared with other all departments.
-
The government should develop and implement effective policies which allow the easy technological transformation of all industries in the country.
Conclusion
Significantly, technology is the future in all industries including the real estate sector. Therefore, Pakistan must adapt to innovative technologies like Proptech and incorporate them in the real estate sector, otherwise, it will fall behind. This concept can be implemented in every sector and process of real estate leading to its expansion worldwide. The possibilities of Proptech are infinite therefore, Pakistan’s real estate industry must follow the new and emerging Proptech trends and join the pathway to development and growth.
References
Borasi, P., Khan, S., Kumar, V., & Yogendra, B. (2021, December). Digital Signature Market Statistics:2030. Retrieved from alliedmarketresearch.com: https://www.alliedmarketresearch.com/digital-signature-market
BR Research. (2021, March 26). Business Recorder. Retrieved from brecorder.com: https://datareportal.com/reports/digital-2022-pakistan
Insights, F. B. (2021). Smart Home Market Size,Share and Covid-19 Impact analysis, By Product and Regional Forecast,2021-2028. Retrieved from https://www.fortunebusinessinsights.com/industry-reports/smart-home-market-101900
Kemp, S. (2022, February 16). Data Reportal. Retrieved from datareportal.com: https://datareportal.com/reports/digital-2022-pakistan
nextdoor. (2022). Retrieved from nextdoor.com: https://about.nextdoor.com/
WHITT . (2022). Retrieved from whittinspections.com: https://www.whittinspections.com/real-estate/ibuyer-companies-pro-cons/
Leave a Reply