It’s arguably the case that the property industry is characterised by inefficiencies, writes Steven Sibbald.
It doesn’t seem so long ago that I watched my dad pick up the paper and circle properties that he was interested in viewing.
It’s now the norm to sit on the sofa and book a holiday, arrange a date, order food, buy gifts for your loved ones or consume a variety of media from podcasts to the latest best-selling books, all online. In a property context, we can now view thousands of properties online, with content aggregated from estate and letting agents presented on a single platform.
While this evolution has largely displaced traditional means of advertising property, I’m not sure it can be described as true disruption as it’s only changed the medium through which property content is viewed, not the actual process.
When it comes to process, it’s arguably the case that the property industry is still characterised by inefficiencies. Agents risk letting to inappropriate and untrustworthy tenants, while on the flip side tenants risk paying out deposits and rent to unsuitable agents or landlords. However, there is great potential for seismic change in the sector through technology because properties and tenants are heterogeneous in nature and that creates an environment that is open for disruption.
We are now starting to see technology based innovation entering the industry, particularly in the US, known as “PropTech”. It promises to change the way people search, transact, finance and manage their properties. The proliferation of new start-ups in the space and the advent of online real estate agents like Purplebricks who charge fixed fees has convinced some industry commentators to opine that the death knell of the traditional agent approaches.
My own opinion is that technology will continue to be an enabler and not a replacement to an agent, helping promote transparency and efficiency in what is typically an opaque transactional process, and I think it’s possible to draw a parallel between Uber and Gett taxi to illustrate the point.
Uber, despite recent travails, is a disruptive technology that is changing how people hail a car. Long gone are the days of queueing at a taxi rank, as Uber allows you to “digitally hail” on demand a driver to take you to your desired destination. Everything is handled through the app, including the payment. The theory works because you get loads of consumers using the app, this attracts more drivers to the platform, which in turn attracts more riders – what we know as the network effect. Primary or secondary income opportunities are presented to the drivers and customers have a more efficient means of transport.
However, it doesn’t give us the local area knowledge, the shortcuts, the stories and importantly the trust and safety that the traditional black cab offer – it’s something I’ve discussed regularly as my dad is a black cab driver!
Enter Gett taxi, which essentially performs the same function as Uber but with the main difference being that Gett connects customers with the traditional licensed black taxi. For me, this is a great example of a traditional model adopting technology to compete with emerging rivals and succeeding.
At Lettingweb.com, it’s our founding purpose to make letting better. That meant creating a platform to connect letting agents with tenants and using our partnerships with the likes of ZPG plc, who own Zoopla, to give them access to the largest distribution network in the country. This week, we launch a new enquiry system; the most material change to our platform ever. It’s positioned to help people make better decisions, save time and rent properties quicker. It’s our aim to create a platform where you can search, transact and manage your home, all from your primary device.
We want to make letting quicker, smarter and safer and we believe this can be done with the traditional agent remaining at the heart of our business.
Steven Sibbald is the managing director of Lettingweb.com