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See your future home in virtual reality
PROPTECH has been the buzzword in the real estate industry for the last few years. The Royal Institution of Chartered Surveyors defines proptech as "a term that refers to all aspects of innovation and how this impacts the built environment. This includes software, hardware, materials or manufacturing."
In Singapore, proptech is a growing sector with the potential to transform the real estate industry. A number of startups have leveraged various technologies to automate workflows of the traditional real estate development process, as well as to improve client engagement.
In fact, the growing prominence of proptech has happened in tandem with the authorities emphasising the need to embrace innovation and leverage technology - one of the key areas under the Real Estate Industry Transformation Map (ITM). Launched by the Building and Construction Authority (BCA) and the Council for Estate Agencies (CEA) in February 2018, the Real Estate ITM charts the transformation of the real estate industry for the future, with a focus on the facilities management and property transaction services sectors.
Today, we see proptech platforms widely used - from investment to leasing, buying and selling with the aim of improving efficiency and enhance the customer experience.
Property transactions online, streamlined
Since the advent of the Internet in the 1990s, various property search portals have surfaced to provide sales and rental listings from both consultancies and third-party sites run by property agencies.
According to HSBC's 2017 Beyond The Bricks report which surveyed 9,000 people in nine countries, property search has become an activity that is mostly done online; nearly 90 per cent of home owners look online for available properties and 86 per cent research online for price comparisons. Agencies have had to evolve and adopt applicable technologies in order to stay relevant or risk being left out of the house-hunting process.
Online property platforms improve the homebuying process as they allow agents to remotely present property and transaction details to clients, saving precious time. Such platforms are also highly secure and can simplify lengthy transactions as agents are able to share digitised documents to the Cloud for clients to review and sign digitally. This can be recognised as a legally binding document, with links to statutory information on the property. The automation of such administrative processes also minimises time on due diligence checks, shortening overall transaction times.
As processes become increasingly digital, consumers' expectations for greater transparency has also grown. For instance, we can now check HDB resale transactions completed by real estate agents in Singapore in the past two years through CEA's website. This initiative by CEA helps agents build consumer trust, as agents' records and claims can be easily verified in a transparent manner.
The CEA is currently leading a new initiative that involves key government agencies and industry representatives - collectively known as the Digitalised Property Transactions Workgroup - to move the industry towards offering seamless, efficient and secure end-to-end transactions for consumers. This has been rolled out for HDB residential transactions since end-2018, with private residential transactions to follow suit from end-2019.
Beyond bricks and mortar
Not to be outdone, some property portals have also upped their game to boost their market share and usage. In recent times, technologies such as augmented reality (AR) and virtual reality (VR) have been adopted - even by developers - to transform each stage of the home purchase process and deliver end-to-end services, greatly enhancing the services traditionally offered by property agents.
For instance, it was reported that house hunters who visited the Highline Residences showroom used a VR headset to experience a 360-degree immersive show suite. That gave potential buyers a realistic visualisation of the apartment fit-out and a virtual tour of the amenities in the area.
For many people, committing to buying or renting a property is one of life's key milestones. The process leading to that decision is often time-consuming and sometimes emotional. Compared to the current practice of viewing static property images on websites or arranging for physical viewings, mobile and online applications help to enhance the overall experience by enabling speedy interactions and on-demand visualisation. Instead of having to fly in for physical viewings immediately, foreign-based buyers can now view properties and neighbourhoods remotely and make better informed decisions before taking the next steps.
Agencies will no longer have to station their entire sales force at show flats and wait passively for walk-in clients, hence freeing up the agents' time to actively pursue genuine leads and customers' requests. Qualified leads can also be generated from these online platforms.
Through machine learning algorithms and big data, consumers can now even get an indicative property valuation, both current and forecasted. With such technology in place, consumers can now make better informed decisions in less time.
Greater assurance for consumers
To give buyers greater confidence in engaging property agents, some agencies are taking a proactive approach by leveraging the power of crowd sourcing. The large agencies in Singapore have launched their own platforms, where agents are reviewed for their services.
This service allows buyers to assess the agents' ratings, areas of specialisation, training and track record before engaging them. What this means is that agents will have to adopt a more service-oriented approach if they want to seal the deal.
A newly established local startup has taken this review-and-rating concept further by launching an e-platform in late 2018 that not only connects home sellers to property agents, but also allows users to determine the commission they think the agent deserves. This is aimed at providing a win-win outcome for both agents and buyers. For the agents, the platform provides them with qualified leads while guaranteeing them a minimum commission. In return, buyers get access to the most competent agents based on what they are willing to pay for.
The adoption of technology to reduce red tape as well as enhance transparency in property transactions and information will ultimately benefit consumers in meeting their ever-changing needs.
Disruption time again
There is no denying that the real estate industry is constantly evolving, catalysed by the adoption of new technologies. While this is not a new phenomenon, it means that agencies and agents will have to consistently improve their knowledge and skillsets to keep pace and stay ahead of the changes. CEA regularly reviews its Continuing Professional Development (CPD) framework for property agents. To enhance digital literacy of real estate professionals, CEA offers the SkillsFuture for Digital Workplace programme for real estate professionals.
In addition to proptech, a real estate professional should also be familiar with fintech, insurtech and legaltech; all of which can aid in one's work when utilised correctly.
Having said that, as homebuyers become more discerning and demanding, there will be aspects of the transaction process which cannot be replaced by technology. The human touch, acumen and first-hand insights offered by a property agent will still be appreciated. These factors, complemented by technology, may well be the winning edge which top-performing agents possess.
- Desmond Sim is the head of Southeast Asia Research at CBRE. Catherine He is the associate director of research at CBRE.