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5 key questions and answers to get up to speed with Proptech

Few people have the opportunity to discuss proptech outside the construction and real estate spaces, and even within these industries, there can be some confusion on the subject. To dispell some of that confusion, here are 5 key proptech questions and answers.

  1. What is proptech?

Proptech is an acronym that describes technology intended for real estate. This can be anything from software like property portals Zoopla and Rightmove, hardware such as sensors, materials such as bricks designed to power solar panels, and manufacturing, such as 3D printing. In daily conversation, the term is also used when talking about real estate tech startups.

  1. Why is proptech so hot this year?

Proptech is no longer a niche technology. It is being noticed- a lot. Although not as big as Fintech (yet) proptech investment is on the rise. In 2011 the amount was $186m US globally. Last year Venture Capital investments surpassed $12b US! Now that traditional firms are investing in proptech, it looks like the phenomenon is here to stay.

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  1. Why do property investors care about proptech?

This is one of the most frequently asked proptech questions. Investors are drawn to proptech because they recognise it as a huge and untapped market opportunity. This opportunity exists because the operators can implement proptech and extract both top and bottom line gains.

For example, in the residential space, topline gains include maximization of revenue, either through improved levels of tenant retention or price discrimination. Bottom line gains include the savings that proptech represents, such as lower marketing costs and energy bills.

  1. Is Alexa a form of proptech?

Another popular proptech question! And the answer is yes. Digital home assistants like Alexa are an example of the expansion into the Internet of Things, or IoT, which is broadly defined as a huge network of connected ‘things’. These relationships are between people, between things, and between people and things, all kept together by sensors. Experts say that by 2022, over one trillion sensors will be connected to the Internet. As people become more connected, more data is produced, which can then be used to plan and use real estate and urban spaces.

  1. Which form of proptech will improve my life?

That is a difficult question to answer. In most cases, the technologies don’t work apart from one another. For example, IoT sensors will collect data, process it using advanced analytics, make sense of it, and use it to insert a value with artificial intelligence. In this particular example, if you remove one of the three factors, the other two are rendered useless to the user.

From an end-user perspective, however, it is definitely the artificial intelligence that you will notice first as if will provide the interaction or analysis that will make your life much better.

Specialists in Construction Insurance

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