Property technology is becoming the new fintech, according to a report by HSBC
By IZZAT RATNA / Pic By MUHD AMIN NAHARUL
The property sector in Malaysia is expected to be the next industry to face disruption, as property websites utilise artificial intelligence (AI) and virtual reality, to transform each stage of home purchases and deliver end-to-end services that are currently offered by estate agents.
HSBC Bank Malaysia Bhd’s latest “Beyond the Bricks” home buying report noted that property technology (proptech) is becoming the new financial technology (fintech), as funding for disruptive proptech firms has grown from RM945 million in 2012 to over RM8.5 billion in 2016.
HSBC retail banking and wealth management country head Lim Eng Seong said the process of buying a home will change beyond recognition in coming years, as it will become a more streamlined transaction with buyers and sellers having greater control and relying much more on technology.
“The speed at which the digital revolution in home buying rolls out around the world will depend on local regulatory environments and people’s willingness to trust techno- logy for such an enormous purchase,” he said in a statement recently.
“The traditional role of estate agents would be reinvented as we now have more online platforms where homeowners can market their own properties and negotiate directly with sellers,” Lim said.
Studies noted that dealing with the many people such as estate agents, solicitors, sellers and developers was identified by 49% of recent homebuyers in Malaysia as the most stressful part of the home buying process, followed by negotiating the price (41%), fees (39%) and understanding the legal paperwork (38%).
The report combines results of more than 9,000 people across Malaysia, Australia, Canada, China, France, Mexico, the United Arab Emirates, the UK and the US, with insights from proptech expert James Dearsley.
Dearsley said new technologies have the potential to disrupt the property industry by making the purchase process much easier and reducing the number of people involved in a sale, so that buyers and sellers feel more in control.
“We are already seeing the rise of online do-it-yourself platforms, such as Tepilo in the UK, which allows homeowners to market their own properties and negotiate directly with sellers.
“All houses may be sold this way in the future, with property websites offering end-to-end marketing, search, financing, negotiation, transaction and convincing services that significantly reduce the time and hassle for homebuyers.
“For traditional estate agents, this means a radical redefining of their role to become technology providers and expert advisors,” Dearsley added. Dearsley said with more people doing their research online now, the days of physically visiting an estate
agent’s office may be almost over. Hence, property websites will become more sophisticated, use big data to bring more and better properties in front of perspective buyers, and take over much of the traditional estate agent’s role.
When it comes to home buying finances, the report noted almost 74% of recent homebuyers researched finance options online, and in Malaysia, the figure was at 77%, followed by the UK, the US and Australia.
Dearsley said brokers are still the most trusted source of mortgage advice, but in an increasingly time-poor society, banks, mortgage brokers and advisors will need to offer instant service and analysis to meet the rising expectations of consumers.
“We can expect to see more on-demand services, retaining the important human touch, but provided digitally through live chat or video. With all of our personal information held digitally and not physically, AI will assist by analysing lending criteria and narrowing down product options.
“This will allow instant mortgage approvals and mortgage solutions that are much more tailored to an individual’s needs,” he said.
According to HSBC’s separate Trust in Technology survey, mortgage brokers and banks are still the most trusted sources of mortgage advice (41% and 35% respectively), while only 11% of people have embraced the idea of using robo-advisors such as chatbots and humanoids for mortgage counselling.