Proptech is short for “Property Technology”, which broadly refers to the overlap between real estate and technology. It’s an umbrella term for all the innovations in hardware and software that impact how property is managed, occupied, bought and sold.
So, which recent developments in the world of technology have the biggest implications for real estate? Here are a few that we think will be particularly interesting in the years to come.
Virtual reality (VR)
Once upon a time, virtual reality was the sort of thing that only existed in Star Trek and the distant future. Today, companies like Oculus have brought the future right to us with technology like VR headsets, which provide access to whole new worlds of virtual gaming and entertainment right from the comfort of your own home. In fact, the same tech that lets you step out of this world and into others also has plenty of applications for your home!
Using VR tech, you can now realistically recreate your existing or future home in virtual reality with an incredible degree of realism. Prospective buyers can walk through property that’s on the other side of the world from them, and still get an accurate idea of what it would be like to see it in person. Planning a remodel? See what the finished product will look like before drilling a single hole.
Augmented reality (AR)
Remember Pokémon Go? The worldwide craze that had folks running all over the real world with their smartphones to catch virtual creatures? By using your phone’s GPS and camera, it “augmented” your reality by superimposing Pokémon over your surroundings, letting you feel like you were really encountering them in the real world. Today, the tech that powers augmented reality can also do much, much more than making your dream of becoming a Pokémon Master come true.
AR interior design apps like DecorMatters or IKEA Place allow you to use your smartphone to scan an area in your home and see what different pieces of furniture would look like if placed there in real time. Others, like PLNAR, allow you to measure and create 3D models of any interior space and share them with people.
A full explanation of how blockchain technology works could easily be a post all on its own, so here’s a basic definition from techterms.com: “a blockchain is a digital record of transactions. The name comes from its structure, in which individual records, called blocks, are linked together in single list, called a chain”. Its key features are immutability (records are virtually tamper proof by design), decentralization (no one entity owns all the data), and transparency (while your personal information is hidden, the transactions tied to the blockchain are publicly visible, which keeps everyone honest).
Originally (and famously) designed to allow the creation of Bitcoin and other cryptocurrencies, blockchain tech actually has a lot of very interesting and disruptive applications for a whole slew of industries, including real estate. For example, maintaining property records could be an entirely digital process in the future, free from the bureaucracy, inaccuracy, costs, and wasted time currently involved in verifying current and previous owners of a property. Property information could be recorded in a blockchain in a way that is tamper-proof, time-stamped, and easily verifiable, resulting in a much more efficient system.
Internet of things (IoT)
Out of all the proptech innovations we’ve outlined here, you’re most likely to have experienced and contributed to the “Internet of things” without even realizing it, especially if you’ve already made Alexa, Siri, or Google a fixture in your household. In essence, the IoT is simply a network of devices that are all connected to the internet and/or to each other. This includes everything from your phones, tablets, Amazon Echos or Google Homes, to your “smart” fridges, microwaves, or even slow cookers!
There are clear benefits to embracing the IoT: a network of devices connected to the internet allows them to work synergistically with each other, and allows you to access them remotely to do things that make your life easier or more convenient, like preheating your oven before you get home, opening your front door using your smartphone, or having motion sensors detect when to automatically turn your lights and heating on/off. The applications are scalable too: these solutions work just as well for an entire apartment building as they do for a single detached home. In fact, fully-integrated properties like Sidewalk Toronto’s planned development along Toronto’s waterfront aim to do exactly that – utilize the IoT to make innovative changes to how people live.
Software companies are poised to do for real estate what Uber (and the ride-sharing industry) did for transport. For example, Canada-based Properly aims to disrupt the tradition model of selling homes with a new streamlined approach that cuts out all the middlemen. The way it works is: you fill out a form on their site to list your home for sale, and Properly will appraise it and make you an offer after taking things like repairs etc. into account. If you agree, they’ll give you an all-cash payout (less a service fee) and will then handle all the repairs, cleaning, and other necessities before it can be sold. If it sells for higher than their offer to you, Properly will give you 50% of the difference. Should this model take off, homeowners will have an incredibly attractive alternative to the tedious process of listing and selling a home through realtors.
On the other side of the property market, the industry stands to greatly benefit from disruptive innovation in property valuation and appraisal processes. FCT has applied the utility and potential of big data and analytics infrastructure, along with sophisticated tools such as Automated Valuation Models (AVMs) to provide more instantaneous solutions for borrowers, lenders, and appraisers alike. By fully leveraging automation and data processing to streamline what used to be manual procedural processes, FCT’s solutions allow appraisers to focus on using their expertise in the most efficient manner possible, while providing quicker turnaround times to lenders and a less intrusive experience for homeowners.
These are just a few of the things proptech has in store for us – a world of possibilities awaits with every new innovation or improvement in technology. If what we have now is anything to go by, the future is going to be very exciting indeed!
Freelance writer and communications professional at the University of Toronto. He’s an avid cinephile, voracious reader, and a terror at karaoke bars.