PropTech’s steady expansion
There seems to be a tech industry term for every day of the week – FinTech, HealthTech, AgTech, DeepTech, RegTech. . . and now PropTech. PropTech, referring to property technology has grown from a small handful of companies to a plethora of different businesses in the last 10 years. The property ladder is a rickety one, and consumers are increasingly looking for innovative and accessible solutions. In a survey conducted by Ipsos Mori, it was found that only 24 per cent of participants trusted estate agents. The services available from startups today aim to provide users with an easier way to buy, sell, rent and let property, which is also addressing the lack of trust in real estate. But who are they, and what are they doing?
1. Property Partner
Property Partner is a crowdfunding platform that was set up in 2014. The service allows users to invest small sums of money in property, starting at £50. Customers can see returns of over 8 per cent, and are given £100 to invest just for signing up. So far, the company has received £26 million in funding, and it’s easy to see why. Many people want to invest in property, but don’t want to be trapped in a binding contractual agreement that they realise they can’t really afford. So far, more than £54 million has been invested via Property Planner.
UK based Eyespy360 is a platform that creates and distributes virtual tours of buildings. Creating virtual tours is notoriously expensive, however Eyespye360 utilises 360 panoramic photos for a cost effective VR solution. The end result can be viewed via desktop, mobile or a VR headset. The demand for virtual tours is high, and is a particularly useful tool for buyers who want to purchase overseas property. Eyespy360 is now the leading provider of self service, virtual property tours. According to company director Andrew Nicholls, “Our platform is enabling our global customers to quickly, efficiently and cost effectively future proof their product offering.”
One of the original PropTech pioneers, Zoopla helps customers to bypass property agencies by searching for properties online. The company was founded in 2007 in London, and the website itself went live the following year. As well as helping customers to find a suitable property, the site offers guides and useful statistics to help people make the best choices for them. It’s all about opening up the process of finding a property, and equipping users with the tools to make informed decisions. Zoopla’s US equivalent is Zillow, which offers essentially the same service.
Purplebricks is another British PropTech company founded in 2014 that demonstrates the prominence of the UK in this area. They operate in major cities in northern England and Scotland, connecting sellers, buyers, tenants and landlords with local experts. Instead of sporadic commission fees, Purplebricks customers pay one set fee. Their strategy is all about cutting out the middle men in traditional real estate companies, forging a direct link between real people and offering personalisation.
Hubble matches office spaces with people who need office space. According to founder and ex-banker Tushar Agarwal, only big businesses have traditionally been able to rent large office spaces, but now smaller companies can compete with these established businesses. Flexible young firms need flexible spaces, which is a trend that Hubble has taken advantage of. The startup was launched in 2014 and is based in London, but also serves customers in Manchester. They recently received investment of £1.2 million earlier this year, and have various notable clients including Jaguar Land Rover.
New PropTech startups are offering the flexibility and openness that estate agents seem to lack (at least in the public eye). Data analytics and Virtual Reality are just two of the disruptive technologies that are effecting real estate, and there is massive potential for the influx of other innovative solutions. At the moment, these companies are very much working with the existing real estate infrastructure. But in future, this could change, as customers receive personalised and simple services that are far more accessible than legacy estate agents. At the moment, PropTech is a relatively new scene – but the success of UK based startups is bound to inspire similar ventures elsewhere. If the PropTech scene hasn’t already disrupted global, legacy property companies, then it certainly will.