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Housing minister announces plans to boost UK proptech sector with data

Housing minister Esther McVey has announced plans to “bring about a digital revolution in the property sector” by opening up local data to UK proptech firms.

The Conservative MP for Tatton yesterday pledged to open up Compulsory Purchase Order (CPO) data including energy performance certificates and square footage information on properties and introduce a national index of all brownfield data to help developers to find brownfield land to build on.

McVey claimed that the data would offer enormous benefits to both homebuyers and the property sector.

“Whatever homebuyers prioritise, whether it’s the quality of local schools, the probability of getting a seat on a train, or having easy access to leisure facilities, this technology could transform the way we find and purchase homes,” she said.

“And new technology will link builders to brownfield sites more easily, enhance how developers engage with local communities, help builders deliver new homes and modernise the way we buy and sell land and houses, cutting the time it takes to get housing from the drawing board to families getting the keys.”

A press release from the Ministry of Housing, Communities & Local Government suggested that the plans could give communities models and interactive maps of planned developments and allow them to comment on planning applications online, on phones and on the go. They could also allow prospective home buyers to use commute time calculators when they are looking at properties, explore financing options, and receive step-by-step assistance on the buying process.

Developers, meanwhile, could be enabled to identify sites so that more houses are built more quickly quickly locate suitable brownfield sites suitable for development.

Sector response

The government estimates that the proptech sector is potentially worth £6 billion in the UK and already receives 10 percent of global proptech investment.

These plans could help it further grow by giving startups and SMEs that lack resources access to tools that can analyse multiple datasets.

Representatives of the property sector were cautiously optimistic about the plans.

Michael Stone, founder and CEO of new home specialists Stone Real Estate, argued that the digital strategy would only reach its potential if the government added easier access to public land.

“Any initiative to open up land supply and provide greater transparency within the house building process should be welcomed,” Stone said in a statement.

“After all, we’re building 200,000 new homes a year nationally while the reality is that we need to deliver 300,000, so that’s some deficit that needs to be addressed. However, whilst the Housing Minister’s announcements today on promoting digitisation and better brownfield site identification will be welcomed, perhaps they should go a step further and start mandating that public land is also utilised more readily.

“There’s an ironic reality that while the government has failed to bolster house building via a number of recent initiatives, a very real solution remains right under their nose. The swathes of untapped land that could be used to develop and deliver more homes are largely controlled by the very public sector that is responsible for, you guessed it, building these homes in the first place.”

Others were more sceptical about the value of the data to lower-income citizens.

“Govt should stimulate the housing market & end class-distinction, it has to be prepared to listen to low-income households with a greater understanding of their needs & greater cooperation if it is to adequately address the real issues people are confronted with on a daily basis,” property developer Leciester & Leicester responded in a tweet.

By Thomas Macaulay

Source: Tech World

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Fintech – A property technology evolution or revolution?

Proptech is a broad term used to refer to a new generation of business and business models based on new and emerging technologies that are disrupting the traditional property markets and business models. Proptech and Fintech are closely related with the overlap of these two areas being how value is exchanged and transferred. In addition to this, it is related to how information is shared and, increasingly, how transparently this is being done.

The origins of proptech date back to the 1990s when the internet began to dominate the way we communicate, and the growth of the internet in 1995/96 led to the dot-com boom, which real estate participated in, albeit quite slowly and quite reluctantly.

So, the internet in the late 1990s was the first building block that established the proptech movement.

It took quite some time in the 2000’s for businesses like Rightmove and Zoopla to get established as residential listing sites using simple internet technology to transfer information.

The real driver that has created the third and current wave of innovation, which is unprecedented and much bigger than what was going on at the early 2000s, is mobile technology, the use of apps, and also the global financial crisis.

The global 2008/9 financial crisis questioned the competence of professionals and traditional ways of doing business in the whole financial tech area, and that made innovators think about alternative ways of transmitting information and transacting assets.

In parallel with the boom of mobile technology and social media apps in the late 2000s, established a platform whereby people could think about trading their most important assets, which would typically be their house, online, through an app, and that’s still the direction we’re heading.

So the origins of proptech are the internet growth in the 1990s, then the growth of mobile apps, and the global financial crisis.

There are three sorts of applications that are currently being worked on, and each of the three proptech horizontals provides unique opportunities and challenges within the proptech space.

The first being information exchange which is a phenomenon of the fintech revolution.

The giving of information online was broadly the first use of the internet.

By consequence, the provision of information about marketplaces is the first fintech movement that has transmitted directly into real estate tech, and particularly residential listings.

Indeed, crowdfunding, as a concept, can be coupled with fintech to produce more creative ways of attracting capital to buy a property.

But it’s tech that’s enabling this business because it brings together a large market of people who want to finance property with a large pool of people who want to invest in property.

So, technology is facilitating that, simply through the efficiency of information exchange through platforms.

The second application of fintech is in transactions, which are slowly being incorporated in real estate.

Indeed, slow it is, with the principle inhibitor being the conservativism of the real estate industry, but perhaps more importantly, it’s to do with the importance and the sheer size of property assets.

Trading property online with no consumer protection, no obvious protection from human beings involved in the process, and a lack of regulation in the process is difficult for people to contemplate.

The transaction process is being facilitated slowly through technology. but there is a lot of resistance, which is very naturally due to human conservatism.

The lack of regulation of the online trading of real estate is probably holding back innovation in this area. Some efficient regulation of online trading of property, would give people much more confidence to be able to trade.

Nevertheless, we are starting to see websites that allow for properties being traded online, sign a contract online through a digital signature. As blockchain, becomes established, I can see this increasing, but it will be slow.

It also asks big questions about blockchain as a way of effecting a transaction and, again, the same question arises, where is the investor protection in blockchain?

Will people accept that the automated, codified regulation process is enough protection, or will they need lawyers and regulatory authorities to be supervising the process in order that there is some redress if anything goes wrong?

The third application of technology that’s hitting proptech is in a different area. And this is to do with the control of buildings, which can be managed through mobile apps or through computers.

So, the best example of that would be the ability to turn your heating on when you’re travelling home from your mobile phone.

And the Internet of Things and smart technology applied to real estate is increasingly well established. It’s generally associated with energy saving. So, the movement is really projected and driven by the need to save energy.

There are many effective apps, which will be developed to help us save energy in homes, and to switch things on and off, and to increase our security, and so on. Those different proptech applications are driven partly by fintech and partly by construction and architecture.

In summary, the property sector is evolving with things much more transparent and computable than they ever were before.

Coupled with technologies like blockchain and AI, which are making the processing of that data, and the transference into actual contracts, almost completely automatic.

How long will it be before you’ll be able to buy an entire building with one click, and that’s it? No more documents and reams of paper and checks of the title and such like.

It’ll all be understood in these digital systems in such a way that you can just say, finance it, buy it, and that’s it.

Source: Mortgage Introducer