By Ivan Lim
Who would have imagined 20 years ago that the first place we’d look when renting or buying a house would be on the internet? Yet here we are, now even making property agents obsolete, thanks to technology and innovation. The property space is one of the industries heavily disrupted by technology, and it continues to evolve. The consumers are the obvious winners, as the entire premise of these changes is to make their life more convenient and give them greater choices.
Looking forward, a lot can change. The prop-tech space has tremendous opportunities for growth and transformation. Here’s listing a few that we can already see simmering in the tech corridors.
Virtual Reality – the new house-viewing medium
Virtual Reality (VR) is growing in popularity as a way of marketing property. In the prime London market, where investors often rather inconveniently live thousands of miles away from the properties they want to view, it proves to be a handy tool indeed. The use of VR in property is already a US$1 billion industry globally, and Goldman Sachs estimates that it is set to treble by 2020.
Australian startup StartVR is currently offering Real Estate VR among its other VR-related services, while Sotheby’s International Realty have already started showcasing high-end properties in Los Angeles using Samsung’s Gear VR last year.
This trend, brought to local context, has caught up with us quicker than we think. A few property sites are already experimenting with virtual tours of homes on their platforms to encourage home renters and buyers to experience the living space in a more ‘real’ way — without actually having to be at the property physically.
Smart contracts and Blockchain tech
Carrying out property transactions over the internet, much like buying books or food, will soon become a reality for everyone. The inherent problem with carrying out this transaction over the internet is ensuring the integrity of data and fraud prevention. The use of Blockchain technology can make real estate transactions safer, reliable, efficient, faster, and cheaper. Moreover, it aids data transparency and enables the use of smart contracts for real estate transactions. Many property platforms are already experimenting with this technology, so expect some real changes in this area very soon!
The sharing economy
The new generation of decision-makers don’t believe in the concept of ‘owning’ everything. It is so much easier to share or exchange holiday homes, share cars, even share clothes. With companies such as Uber and Grab for sharing cars/rides, Airbnb for sharing/exchanging holiday homes, and the popular reselling of unused/unwanted belongings on C2C platforms such as eBay, Alibaba and Carousell, the need of owning ‘new things’ is not as pressing as before, especially when it comes to things with high value.
This ‘sharing economy’ habit can be seen in the property market. According to URA, the number of rental transactions stood at 56,417 last year — an increase from the 50,417 cases in 2013 and 48,785 in 2012.
With many workspaces becoming virtual, the concept of a ‘fixed office’ as we know it may change dramatically. Julien Smith, co-founder and CEO of Breather, an Airbnb-like company for office space, pointed out the factors that are disrupting the idea of traditional office spaces. Increasing interconnectivity, mobility, and work flexibility, will have an impact on property prices in urban centres. In fact, many small businesses are already existing without a fixed office. And why would they when everything they need to work on and connect with colleagues and clients is on their laptops and mobile devices?
Transportation will make the world smaller
In terms of real estate prices, property values that are located close to public transit increase at a higher rate and have been shown to be more resilient to economic downturns. People want to live in the downtown core, and public transportation is commonly at the forefront of political debate. However, as urbanisation increases at an exponential rate, transport infrastructures are being constantly re-innovated to cater to what we call ‘global-citizens’.
The Seoul-Busan axis is South Korea’s main traffic corridor. In 1982, it represented 65.8 per cent of South Korea’s population, a number that grew to 73.3 per cent by 1995, along with 70 per cent of freight traffic and 66 per cent of passenger traffic.
With both the Gyeongbu Expressway and Korail’s (Korea’s main subway provider) Gyeongbu Line congested as of the late 1970s, the government saw the pressing need for another form of transportation. In 1992, construction began on the high-speed line from Seoul to Busan, and the Korea Train Express (KTX) officially launched April 1, 2004. With the KTX, people staying in Busan can get to work in capital Seoul in less than three hours. It is therefore becoming easier to stay in distant places and still come to work in a reasonable time.
High-speed intercity rails are being more common, with South Korea being the fourth country after Japan, France and China to develop a high-speed trains (running on conventional rail above 420 Km/h). There are similar expectations for the planned high-speed rail link between Singapore and Kuala Lumpur in Malaysia – Singaporeans working in Malaysia and vice versa will be able to benefit much, without having to invest in real estate.
Nanotechnology to the rescue
When it comes to building better and more durable houses, nanotechnology is already offering far smarter solutions to our home needs. The technology is now giving rise to various applications such as building materials with insulating properties to protect from weather variations, durable concrete that doesn’t crack easily, windows that hold the heat in better, and paint that is mould-free and does not harbour bacterial growth.
Automation will make maintenance cheaper and more efficient
Robots and cleaning gadgets will become more commonplace. IoT will take over our buildings and homes, taking care of routine maintenance tasks, inventory supplies, detecting malfunctions and defects before it becomes an inconvenience to the users. We will see more of these robots that can control our homes, making adjustments to our surroundings just the way we like them.
Sustainable and eco-friendly
Sustainability is a big buzz word that many people use but not all understand. However, get ready for more of it. All housing developments would become ‘sustainable’ in some way. This refers not only to the environmental footprint when designing and constructing houses, but also how the day to day operations are managed.
Solar energy and use of recycled materials are just some of the ways in which houses can be more eco-friendly. Waste processing and harvesting of rainwater might be other possible ways. We will also see ‘sustainability’ being measured in more concrete ways, and governments around the world may finally embrace it and make it legally enforceable.
3D printing of houses
Last year, a firm in China proved what many people thought was the stuff of fiction. They built 10 houses in a span of 24 hours using a proprietary 3D printer. It won’t be long before others jump on the bandwagon, and begin fabricating houses in a short amount of time. Apart from eliminating human errors, these houses require much less man power and present huge savings. In a few years, you might actually be able to order a custom-built house over the internet and have it delivered the next day!
This article, entitled “From smart contracts, to VR, to 3D-printed houses: How property tech is making a big difference” originally appeared on e27.