By Qiu Xia, Marketing & Brand Manager at FutureBricks/Brickway
Technology in property has been house buyer and tenant centric, fueled by new heights in property investments which has reached a record level high. It has left behind the actual players in property development delivering the final assets: builders, planners, architects, site managers, property entrepreneurs, etc.
Money and innovation have been put close to where the mouth is, sewing and resewing the seams of the deep pockets of the profitable real estate listings and property management portfolios. In an industry where the actualization of a final asset demands the coming together of a large number of players, these players are scattered solo sportsmen and sportswomen on a field of one team and no opponent.
Just two years ago, the vast majority of proptech firms sat within the transactional nature of the real estate agency market to support buying (22%) and selling (21%), with a significant number in renting (21%) and managing properties (27%). A meagre 6% of proptech firms support the building of actual properties in a market where there is a lack of affordable homes year after year and an average of about twelve properties available for sale within each real estate agency office.
Figure 1: Distribution of residential proptech companies in the UK 2019, by stage (Statista Research Department)
Last year, UK property investments reached £1.6 billion, quadrupling from 2020 according to Pi Labs. Looking at these figures and the trend of proptech firms popping up in this playing field, where are we now with inclusivity in proptech? The smaller deliverers of the final asset may have well been left behind.
Most property entrepreneurs are left to fend for themselves, rallying a team of game changers painfully slowly: we have statistics on the number of homes that do make it to the sales market, but we know very little about the number of development projects that do not make it to the sales market. The industry has a gaping hole: a holistic approach in supporting the development process through technology in an all encompassing way.
The year 2022 has felt the ripples of the past two years, affected by Brexit, the pandemic, the rate of inflation afflicting the UK in relation to the rest of Europe and the US, and climate changes. Material costs have risen 9.1% in 2022’s Q1 and Q2, with an anticipated growth of cost up to 2026 being at an additional 24.1% based on the Savills’ second quarter report. The Bank of England is combating inflation with an increase in interest rates, affecting the cost of mortgages. This solo sport is furthering the divide between the players witnessing the shift in the real estate space.
The current state of the economy stumps the housing price growth as the gap widens between the affordability of a house for sale on the market and the wage increases, adding to the pressure of building new homes when the oil and energy prices impact the supply chain for the construction sector. TfL’s numerous projects aimed at helping uplift different areas close to London have been halted. The world seems to be at a standstill when it comes to strategic decision-making for property entrepreneurs, reading a hazy future for the next year and two. With inflation foreseen to peak this Winter, the key question is: what will happen to the property development market, a divided playing field?
Unanimous decisions are being made by independent players tracking the trajectory of the UK market. During this reactive time period where alertness is at its peak, inclusivity in property development and construction, the pillar of real estate, begs the place of technology revolutionising a traditional space.
Where is the inclusivity in proptech? Brickway, a one-stop shop proptech platform examines the possibility of a social and professional space bringing together the multi single players contributing to every asset on the real estate market. It is looking at the small and medium sized property entrepreneur, the independent contractor, the electrician, the plumbing expert, the small office of a planner, the boutique architect, the new commercial broker on the block, the handful of specialist lenders and countless other people that support the expansion of the real estate market rather than laundering and re-laundering the same assets for a profit cut.
This is a call for inclusivity in proptech, where innovation in property is here to serve to rally the players to the same playing field, one that is expanding and socially supportive.
Brickway, a London-based proptech (and a sister company of FutureBricks), will be sharing the results of a proptech survey it has conducted with small property entrepreneurs and independent construction experts. Brickway is a platform that will hit the market at the end of 2022/early 2023 as a one-stop shop for developers and experts in property development, addressing the pain points along the journey of construction, from site sourcing to profitability assessment to financing to expertise hiring. It views itself as a social endeavour, here to bring together the property experts under one roof. To register your interest for Brickway, visit their static home page here.
Brickway will release its proptech survey findings later this year, an initiative by its Marketing & Research department led by Qiu Xia. For collaborations and partnerships, please email her at email@example.com.
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