According to a recently published report, the Indian real estate sector is expected to achieve a market value of USD 1 trillion by the end of this decade. A multitude of factors like rapid urbanization and rising disposable income is driving this growth, but it is technology that has played a pivotal role. In fact, proptech and technologically driven construction project management will effectively reshape the Indian real estate sector, opening a whole new realm of opportunities for real estate players, that includes buyers as well as sellers and everyone else linked to the chain.
How should real estate sector embrace this change?
Synergizing real-estate and technology, proptech has ushered in a new era for businesses in the real estate space. Real estate players have started to engage with new technologies such as IoT, blockchain, artificial intelligence and virtual reality, not only in terms of project management for construction, but also in simplifying the property business end-to-end.
Embracing proptech and its possibilities requires real estate professionals to develop a deep understanding of the industry. To that end, they need to make necessary changes in their business operations, right from integrating technology at the pre-construction phase to the methods of purchasing materials and material management to delivering customer service and keeping up with the latest trends. Here are the proptech trends to look out for in 2020:
Era of co-living spaces
There has been a sharp rise in the number of co-living space providers in the country. Catering primarily to students and young working professionals, majority of these companies combine technology with ground operations to offer an end-to-end housing experience to millennials. A thriving start-up culture and the shift to sharing rather than owning property are two of the other key factors that will drive the growth of co-living spaces in 2020.
The co-living sector boasts of being one of the early adopters of technological innovations such as artificial intelligence, machine learning and chatbots.
The idea of co-living has gained more momentum with proptech as it enables safety and security, through 24×7 CCTV surveillance, video door monitoring, smart locks, facial recognition-based key management, smart alarms, and more. Co-living spaces are already popular in metro cities, and 2020 will see it percolating down to Tier-II cities as well. According to a 2019 report from FICCI and JLL, the Indian co-living spaces market is expected to grow at a CAGR of 17% and touch around Rs 1 trillion by 2023.
Smart Buying Experience
From the point of buying materials for construction to finalizing sale of a property with the end-use buyer, prominent players in the industry have successfully harnessed the power of technology to achieve better efficiencies and streamline the entire real estate business process. Proptech can revitalise the arduous process of construction procurement by facilitating clear communication between potential buyers and vendors regarding material specifications and enabling a better decision in selecting the best vendor and the best material for a particular construction.
The numerous steps in property transaction such as agent and customer interactions, site visits, availability of desired unit, information disclosure, financial proposals, mortgages and final closure can all be governed and monitored by a tech platform in real-time. Expectedly, this translates into a seamless and delightful home buying experience. When it comes to showing ready-to-move in properties or phase of construction to potential end-use buyers, experimenting with emerging technology such as drones, virtual reality tools, IoTs and blockchain are gaining quick acceptance.
In fact, today’s consumer seeks comprehensive support for a property transaction through its entire life-cycle. Property business firms that have internalised this brief will stay at the forefront of India’s real estate disruption in 2020. If you are still not convinced, then you might be interested to know that a real estate transaction got completed in Vermont, USA solely with blockchain technology and with the government’s nod too.
The property market is becoming increasingly dominated by tech-savvy millennials and Gen Z, who expect to control lights, temperature, home appliances and more from their phones. Smart homes have become the new home trends that these demographic cohorts want to invest in. With this in perspective, real estate and the Internet of Things (IoT) deliver a promising partnership.
With IoT devices such as thermostats and automatic light control getting mainstream and the incorporation of smart material management process by real-estate developers in constructing buildings becoming common, we can expect smart home prices to go down and more and more home builders gravitating towards this trend.
Real work by Artificial Intelligence
So how can AI tackle major challenges of the construction industry? At the design stage of a project, AI can present a comparison of large number of models after taking all factors into consideration to discover the optimal time and cost for a particular project.
On the basis of the model selected, intelligent supply chains will be able to undertake design detailing, build resource plans, source and place orders. It can also use that data to give a comprehensive presentation of all project requirements to optimise the cost and delivery of resources to site.
Once projects are up and running, AI can be engaged on site to address skills shortages in brick laying and scaffolding to improve efficiency and quality. Real estate companies are also using AI driven chatbots to save time and resources while answering queries of end-use customers in an efficient manner. AI algorithms are being used for analyzing data to offer suitable deals for customers and personalizing customer interactions with a website or an app.
To sum it up, proptech has significantly contributed to the real estate’s rapid growth in the last few years and it looks poised to drive future growth in the industry. With growing competition in the real estate sector and lowering tolerance for inefficiencies, demand for proptech will only continue to grow. All real estate players should heed the call of ‘shape up or ship out’ and integrate proptech in their business ambit if they wish to continue their relevance in the industry. The more serious players have already started working on it.