Proptech boom and future
With growing urbanization and digitization in every facet of life and business, technology is now the main impetus in enhancing general well-being and boosting important economic metrics in India. Real estate technology, often known as property technology or PropTech, has emerged as a result of recent technological disruptions, rapid technological breakthroughs, and digital revolutions. As a result of this digital revolution in a world that is becoming more and more digital, a new idea was created, carrying with it billion-dollar prospects.
Proptech, also known as property technology, is the fusion of the real estate sector with technological, software, and digital solutions to maximize the sale-purchase, research, marketing, and maintenance of properties. To put it another way, it’s an application of IT to the real estate sector that enables businesses to improve convenience and effectiveness in their end-to-end property management procedures. Proptech entails operations such as Sales, advertising, personnel administration, secure payments, and customer experience.
The Indian PropTech industry has enormous potential for unleashing real estate potential not only in major Tier I and Tier II cities but also in urban and rural areas. According to an INC42 report, the overall Indian real estate market is expected to reach a size of $1 Tn by 2030. Similarly, another research by Invest India suggests that the Indian real estate industry is expected to exceed USD 1 trillion in value by 2030 and will contribute approximately 13 percent to the country’s GDP by 2025.
Due to the quick adoption of digitization, India’s traditional real estate market has changed, creating new opportunities for stakeholders and startups in the PropTech industry. Currently, India ranks fourth in investment raised globally, with over 6% of recognized businesses, and is on the track to become the third-largest construction market globally by 2025, spending an estimated $ 1.4 trillion on infrastructure. Some of the well-known PropTech start-ups include MagicBricks, Common Floor, owned by Quikr, Makaan.com, and 99acres.com.
Commercial and residential real estate PropTech refers to the various tools PropTech companies use to probe, rent and market residential and commercial properties. It encompasses property search platforms, instruments for managing and planning construction projects, tools for evaluating and financing projects, resources for utilising assets, etc. Each of these are supported by blockchain technology as well as deep learning (ML), machine learning (ML), artificial intelligence (AI), virtual reality (VR), augmented reality (AR), the Internet of Things (IoT), and 5G, etc.
The introduction and growth of PropTech have sparked transformative developments in the industry. For instance, the RERA Act’s implementation has considerably strengthened rules and buyer protection by encouraging openness in real estate transactions. Let’s now explore the factors driving the development of the PropTech industry –
Throughout and post the COVID-19 pandemic, PropTech which was birthed due to the pandemic, has pushed development and growth of the real estate industry in India. Since there was little possibility for customers to visit the premises, real estate businesses have made a digital transition by utilizing augmented reality and Metaverse to offer rich client experiences.
Due to the reasonable costs and community-focused atmosphere, sharing and co-living spaces are gaining quick
popularity amongst millennials and Gen Z. With the demand for these types of spaces increasing, PropTech portals like the Aurum and Nestaway deliver immediate options via mobile apps and platforms.
Integration of technologies like Virtual Reality (VR) and Augmented Reality (AR) have entirely transformed the manner of perception of properties. Now, buyers in pursuit could take virtual tours of houses with the ease of their
own homes, affording an authentic and engaging experience. Moreover, due to this enhanced visualization, buyers must be equipped to make prudent choices thereby enhancing the entire process.
Due to the ease of the financial stress on solo investors and younger real estate investors, the concept of fractional ownership is gaining quick popularity. With the help of this idea, young Indians can invest in real estate because it breaks up the cost of expensive commercial property into multiple fractions thus rendering it accessible and cost-effective. It is expected that in the coming years, this trend would completely transform CRE investments.
To minimize physical labor and resource consumption in the real estate sector, prominent PropTech businesses are deploying Software as a Service SaaS, PaaS, and IaaS.
A novel application of PropTech in real estate has been in the adoption of drones into the displaying and selling of homes, bringing perks such as aerial photography, greater vantage points of vast properties, and a rise in interest
in listings.
The use of virtual tours of properties has been effective in bringing a revolution in the real estate market. With the Covid constraints in place, the technology received wider acceptance by PropTech enabling interested parties could visit the property, get an accurate description of the interiors, and make a decision at the
comfort of their space.
Blockchain technology has become a significant trend in the real estate industry with the effect of simplifying and securing transactions. With PropTech the process becomes more transparent by harnessing blockchain’s distributed ledger architecture, which further reduces the need for expenses and paperwork while abolishing the need for intermediaries. Accordingly, it is beneficial for a fraction of real estate investment and the upkeep of property titles. Likewise, it possesses the capacity to authenticate and assess encrypted transactions to safeguard financial information.
PropTech has enabled the automation of repetitive administrative tasks such as maintaining documentation and managing legal compliance. Real estate managers could give more time to offering exceptional customer service along with keeping property managers up to date on check-ins, viewings, and rent due dates, the software additionally assists them to recollect crucial information.
Among the most recent developments in PropTech involves the concept of using search engines like Google and Amazon to search properties for customers through voice-activated instructions. New devices like the screen-based Amazon Echo Show, which responds to voice commands and user data choices, might show certain attributes upon voice command.
It has also received a lot of attention from numerous industry stakeholders. Large numbers of buyers and renters were swarming to websites like 99Acres, Magic Bricks, Housing.com, and others for services such as narrowing down properties as per their needs, discussing the pros and cons of a particular locality by communicating with previous buyers, and getting information on the positive and negative aspects of purchasing and leasing real estate.
Nowadays, chatbots are widely employed to generate leads and provide better service. These are software-generated communications intended to initiate and continue conversations with business clients and customers to allow the facilitation of crucial information. This automated method of communication might potentially lead to
potential merchants getting recommendations and online evaluations from bots.
Real estate Proptech benefits consumers by easing their search for a property and offering transparency. PropTech provides explicit awareness to consumers that avoid misreading and squandering. Here are certainly significant benefits of Proptech for the customers as well as businesses-
The property industry has modified its approach to marketing as an outcome of PropTech’s constantly expanding potential. Businesses put a lot of effort into creating online listings for residential as well as commercial properties so that clients may research a variety of properties from the comfort of their homes and assure rapid sales. Along with allowing customers access to properties with minimal brokerage fees and no hidden charges, there are extensive property databases for search websites along with advanced technologies, sales, financing, management tools to offer reviews and tools for infrastructure inspection have been enabled.
PropTech allows the sale and purchase of real estate in a way that is both safe and useful. The primary objective of the technology is to safeguard, improve, and streamline client experiences throughout the entire journey. Several prominent businesses have used PropTech technologies for financing, debt financing, transaction underwriting, and property sales and evaluation. Also, blockchain technology could potentially be applied to verify encrypted transactions and further ensure that the financial records have not been tampered with.
Real estate sales and purchases include several formalities and large paperwork for even a single transaction. PropTech has enabled the complete process of online property paper verification tools, legal advising, and notarization services, rendering the entire process easier for the customer. Further, Blockchain-based property technology enables buyers and sellers to immediately establish and validate contracts and other critical papers. Accordingly, the products of PropTech could be used by real estate brokers for digital agreements, making the process faster, smoother, and more reliable.
It becomes much easier to facilitate direct and clear communication between sellers and buyers and improve their transaction experience. Individualized purchasing and selling experiences are offered through tools like blockchain, big data, and artificial intelligence (AI), thus creating a social interaction between buyers and sellers. And, to actively assist customers with questions and concerns, several PropTech companies provide resources like online assistance, virtual assistants, and chats.
Since PropTech has evolved, consumers can access real- time information through their mobile apps and keep information at their fingertips. Now customers may retain papers, download contracts, receive real-time notifications, check events and meetings, and do many more things through various mobile apps. Likewise, property owners no longer need to personally inspect their properties because of instruments like smart devices and sensors (IoT), as all the updates regarding the property’s maintenance and security would be accessible through mobile apps.
With the help of PropTech, the majority of processes can be automated which clarifies the situation for all parties involved, including management, staff, banks, channel partners, and clients. Real estate developers either commercial or residential properties can use it to transition to smart papers and blockchain- based securitization. The payment facilitator approach may also be used by property management platforms to provide consumers with a secure and simple payment experience. Additionally, they might offer several payment options to make things simpler for the customers.
The PropTech data tool is an invaluable instrument for marketing advancement, redefining target customers, and receiving better deals. Technology- enabled engineering and building tools have made it easier to track growth, investments/leasing/buying, and selling possibilities. Further, the emphasis is on speeding the building process, reducing waste, boosting quality, and minimizing overall construction costs. Real estate developers are using it to figure out the amenities that would appeal to the target market and identify the most lucrative areas to create new properties.
Post-Sales Services enable developers to channel client requests and handle them altogether, ensuring complete customer satisfaction. By tracking down and fulfilling transactions, PropTech helps developers deliver top-notch
post-sales services. Likewise, through the utilization of features such as cost sheet management, post-booking communication, demand letter production, reminders for payments, and client loyalty, along with other vital processes, it effectively converts leads into customers.
With greater transparency, more efficient transactions, and easier access to data, the Indian PropTech ecosystem is growing rapidly as an outcome of the pandemic’s acceleration of digital development. To modernize the sector and advance sustainable design principles, adaptive reuse, and net-zero energy structures, real estate developers are combining artificial intelligence, virtual reality, and blockchain technology. Such trends encourage an approach that prioritizes customers that promotes transparency. With PropTech continued development, the Indian real estate market can look forward to a future that is more frictionless and effective for purchasers, sellers, and investors alike. Therefore, real estate organizations must fulfill the changing needs of the next generation of property stakeholders, businesses must embrace these technology breakthroughs and improvements.
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