We got our team of tech PR specialists to scour the web, interview journalists and reach out to their networks to provide a breakdown of the biggest issues facing the proptech sector in 2020.
1. Digital transformation
The property industry is something of a dinosaur, and has been slow to embrace technology. Property specialists cling to older, more traditional ways of doing things. In 2020 we will continue to move towards a more tech-dominated industry (boosted by initiatives like the Housing Minister opening up Compulsory Purchase Order (CPO) data for the first time) but progress will continue to be slow.
2. New government
While we don’t know for sure what the Conservative majority will mean for the property sector, we did see a jump in seller confidence immediately following the election. Questions still remain over whether we will see any changes to stamp duty and section 21, and the property industry will be eagerly awaiting the 2020 budget in March.
3. Disruptors not disrupting
A number of property industry disruptors seem to have failed to live up to their hype in 2019: from WeWork’s much maligned IPO to Central Working and the Clubhouse collapsing to a number of BrickVest subsidiaries falling into administration, proptech is starting to get a bit of a reputation. This will likely throw up further resistance to digital transformation.
4. Lack of early stage funding and investment
After the events of 2019, it’s no surprise that investors are wary of proptech. This means that for start-ups, early stage funding can be a challenge.
5. Lack of data and connectivity
The fintech boom in the UK has been driven in part by open banking – huge swathes of data is available to fintechs. This has yet to be mirrored in the property sector. Plans to open up CPOs means there is a huge glut of data about to become available to a sector that desperately needs it – the opportunity for B2B and B2C innovation is huge.
6. Property skills shortages
One of the biggest barriers to addressing the housing shortage has been the lack of Approved Inspectors. With many going out of business following the Grenfell disaster and subsequent underwriting issues, it’s become a newbuild bottleneck.
7. Tech skills shortages
While there seems to be no shortage of founders keen to launch exciting new proptech disruptors, they just don’t have the tech backing they need, with too many hacking together inadequate propostions with limited coding resources. Good development still comes at a premium – David Jacobs, cofounder of online estate agent Yopa, previously revealed its MVP was so jampacked full of bugs, that when an early TV advertising campaign took off, they were flooded with customer inquiries, and nothing worked as expected.
BONUS: ConTech is coming
ConTech is a $10 trillion annual market worldwide, with $1.3 trillion turned over in the US alone last year. And it is set to get much bigger. A recent PWC study predicts that the global construction industry will grow 85 percent by 2030 to $15.5 trillion – with numbers this big and so much paper pushing involved in the proptech sector, will it be ignored entirely by investors? To give your proptech business the best chance of growing from a townhouse to a skyscraper, drop us a line today.