The property market looks set for a technological transformation
The property market looks set for a shakeup as the technology sector opens up the market.
The term ‘fintech’ has been in and out of the news for some time now, but there’s a new kid in town: ‘proptech’. The tech market is finally cottoning on to what many small investors have known for some time; property is where it’s at.
Despite the boom in other areas, the tech market has been sluggish in taking the ever growing property sector under its wing and making it its own. Now, however, things are set to change, as technology startups begin to focus on the property market in ways that haven’t been seen to date.
Is it really that new?
Of course, the likes of Rightmove and Zoopla are already household names in Britain, but the kind of innovation driving the current wave of technology companies that have an interest in the UK property market is set to take things on to the next level.
Take the mortgage arena, for example. Now, with more and more mortgages over 500,000, there are growing ways to borrow the money rather than the traditional route of visiting your local high street bank. Gross mortgage lending in Britain was a staggering £220.3 billion in 2015, showing a year-on-year increase of 8 per cent. Is it any wonder that this part of the housing market is coming under scrutiny from entrepreneurs looking to gain even a small slice of what is an extraordinarily large pie?
Property Investment for the Masses
It’s not just the mortgage market that looks set for a shakeup over the coming years; the residential rental market is set to change too if the tech world has anything to do with it. Largely fuelled by the sheer unaffordability of homes, the private rental market has become a haven for investors looking for a relatively safe place to put their money.
The amount of amateur investors who have suddenly found themselves as landlords has grown exponentially over the last decade or so, but it has still been largely restricted to those who have a certain amount of money to spare in order to get started. Proptech companies are looking to change that. Now it is becoming more and more viable for ordinary people on ordinary wages to invest in residential property thanks to companies such as Property Partner.
Even the agency process is being deconstructed
Whether you are buying, renting or looking to have your property managed, the process behind each of these can be a little painful at times. Now proptech companies are seeking ways to smooth the way these necessary parts of the housing market work, making things altogether better for the client. Keep an eye out for names such as Fixflo and Goodlord in this section of the market.
So, despite the slow uptake from both the technology and property sectors to combine and shake things up in one of the biggest and most publicised markets that there is in Britain, things are beginning to change. Turning round an industry that is heavily steeped in tradition will by no means be easy, but who would have predicted the technological advances that we have seen elsewhere since the turn of the millennium?
Paul Welch is the CEO & Founder of Largemortgageloans.com, a London-based mortgage broker which specialises in mortgages over £500,000.