Over the past year, digital transformation in the property market has accelerated at a rate we’d usually expect over five or more.
The ‘push for digital’ has arrived early out of necessity and the Covid-19 crisis has turned tech from business luxury to an essential means for growth.
With three national lockdowns, almost all industry players have worked remotely at some stage as regular ways of working have been disrupted. And yet, the property market has been one of the busiest on record and house prices have reached record highs in many areas of the UK. At the same time, much of the wider economy is in survival mode and the number of unstable borrowers is skyrocketing. This has created a challenging market to manage and, in many ways, technology has been its saving grace. As I see it, each lockdown charts a journey in which technology has been a key part - it’s useful to start at the beginning to understand where we are now.
A tale of three lockdowns
The first national lockdown was a wake-up call to the role of technology in the work of brokers, lenders and agents. The mortgage market closed temporarily to new business for part of the lockdown and those still working to process ongoing cases relied on existing technology to help them do so. Videoconferencing increased exponentially, as did the use of messaging platforms like Microsoft Teams, and even customer-facing technology like chatbots were employed more heavily by larger businesses who could afford it. Broadly speaking, tech-enabled market players to stay afloat and connected.
By the second lockdown in November, the industry had matured. Not only were we all Zoom specialists, but more advanced technologies such as automated valuation models (AVMs) were being used on a wider scale. At Mortgage Engine, we witnessed first-hand brokers and lenders welcoming the prospect of open finance models, such as application programme interfaces (APIs), as a way of handing them time back from laborious tasks in the application process, like the rekeying of data. With advisers and lenders under significant pressure, many firms woke up to the value of technology as not just a luxury, but an integral component to their long-term evolution.
If lockdown one was about staying connected, and lockdown two was about a shift in attitude, then what does lockdown three herald?
One notable trend is the rise of the challenger. New portal services, for instance, are harnessing technology to unseat market leaders Rightmove and Zoopla. One service, OneDome, has partnered with Facebook Marketplace to begin listing properties and aims to use its platform to speed up transactions to four weeks.
At the same time, the dominant players have put their foot on the digital accelerator by unveiling a range of tools. Rightmove has expanded virtual viewings, while Zoopla is building an ecosystem to allow agents, buyers and vendors to interact with one another in a central place. In addition, it is becoming common practice for agents to list properties with video or with 360° viewings available and portals are integrating these as a result. Fintech partnerships are behind a great deal of this
transformation with innovations such as digital ID, which software company, Smartr365, has introduced to speed up the verification process for brokers.
The future is digital
These lockdown trends are extremely promising for the property market’s future. It’s interesting that the most popular technology in the property market throughout the crisis has been that which connects us. From video conference platforms to digital-based ecosystems which allow users to track the end-to-end customer journey, the rising appetite for market-wide connection is clear.
It makes for an exciting 2021. An open data economy is one where open finance becomes integrated into broader digital ecosystems, and a property market built in this way is looking more like a reality by the day. Much of the technology already exists; at this stage, industry trust and belief in the potential of technologies like APIs is the most important investment to build this vision. As the new world of work evolves before us, it’s clear that the future is digital – and those quickest to embrace it will benefit first.