PropTech (property tech)
PropTech (property technology) is the use of information technology (IT) to help individuals and companies research, buy, sell and manage real estate. Similar to the way FinTech focuses on the use of technology in finance, PropTech uses digital innovation to address the needs of the property industry.
PropTech is designed to streamline and connect processes for participants in all stages of the real estate market, including buyers, sellers, brokers, lenders and landlords. Popular PropTech technologies include virtual reality software that allows website visitors to virtually walk through properties, software for reporting repairs, splitting rent payments and crowdfunding new real estate projects.
As of this writing, PropTech consists of three major market segments:
Smart home -- digital platforms that monitor, manage or operate specific property assets in smart homes. An example could be a security surveillance system that warns property owners of a threat, a smart thermostat that regulates the temperature of uninhabited units or smart light bulbs that can be turned on by a smartphone app or digital assistant, like Amazon Echo's Alexa.
Sharing real estate -- technology that facilitates the processes involved with sharing or renting real estate assets such as land, offices, storage and apartments. An example could be automatic online payments for retail spaces occupied in a building owned by a property management company.
Real estate FinTech -- applications that involve selling and buying real estate assets. An example could be a platform that reduces the amount of paperwork involved in being approved for a purchase.
While still a relatively new field, the convergence of technologies, cloud and digital transformation are forces driving PropTech forward. The goals of PropTech include minimizing the cost and resources associated with real estate transactions, maximizing efficiency, saving time and personalizing property management. The distributed ledger Blockchain is expected to play a roll in creating a secure infrastructure for real estate payments, tenant credit checks and smart contracts.