The era of traditional methods and conventional practices in the Nigeria real estate sector will soon be overtaken by technology as transactional activities in the sector are, increasingly, being done with property technology (Prop-tech) which is already getting spirited attention and investment interest.
Proptech is a collective term used to define start-ups offering technologically innovative products or new business models for the real estate market. Because of this, the market is already experiencing a wave of innovation, investment and entrepreneurial activity
The last couple of years have seen increasing role and use of proptech in real estate, creating opportunities for buyers and sellers alike, and leading to the growth of the market.
“Proptech is slowly gaining momentum in developed markets, and we feel a developing market like Nigeria can learn and re-calibrate itself for seasoned investors,” Abdulhakeem Sadiq, Proptech pioneer, founder/CEO of new market entrant, Zama, confirmed in Lagos recently.
Although, prop-tech has not fully gained ground like financial technology (Fin-tech) in the global space, investment in it has trended upwards in the past nine years, thereby opening the door of opportunities to African economies, particularly Nigeria.
At the maiden edition of a Property Technology Conference organised by Pison Housing Company real estate stakeholders across the value chain who are innovating or at conceptual stages of innovation that will change the narrative in the real estate space gathered to deepen conversation on this new phenomenon.
Roland Igbinoba, convener of the confab and Founder of Pison Housing Company, stated that global investment in prop-tech surged from a mere $20 million in 2010 to $14 billion in 2018, and projected to hit $20 billion in 2019. The investments have been witnessed in virtual reality, real estate crowdfunding, big data & analytics, artifical intelligence, smart building technologies and portal listings among others.
“The industry needs to collaborate with government to take the sector to the next level. Government has a lot of data they are yet to use, that is why we bring people who have experience in Prop-tech to develop the industry.” Igbinoba said.
According to him, the future is tilting to artificial intelligence, block-chain, and smart technologies. “That is why we organized this event to get emerging participants together to see how we can transform the industry,” he said.
Prop-tech is a broader term that encompasses the application of information technology to real estate markets to lessen paper work and make transactions more effective.
Tayo Odunsi, Managing Director, Northcourt Real Estate, noted that Proptech accounts for about 15 percent of venture capital funding in the world.
Nigeria accounts for 52 percent of internet usage in West Africa, according to him, citing rising mobile phone use, decrepit real estate start-up, big data analytics, customer experience and emergence of new technologies, as drivers of prop-tech growth.
James Dearsley, global prop-tech influencer, maintained that prop-tech is a segment of the wider digital transformation of the property industry, adding that prop-tech companies aim to provide global solutions to local problems.
Speaking on the feats of Unissu, a global leader in Prop-tech information, research & data, Dearsley disclosed that the platform has 268, 000 members in 97 cities across the globe. The platform has also raised $8.1 billion in funding and 22 percent of revenue comes from enterprise businesses.
“We are moving from transactional-based business models to one that almost focuses on exclusive service business”, he said, noting that mentality and infrastructure define Prop-tech adoption globally.
On his part, Taofeeq Olatimo, Head of Business Operations, Nigerian Mortgage Refinance Company (NMRC), said that his company has been able to develop an app –‘NMRC HMS’ to enhance access to mortgage data, adding that almost all mortgage banks are making use of the app.
He disclosed that NRMC was partnering Nigerian Housing Fund Program, National Real Estate Data Collection and Management Program and World Bank to provide quality data to help investors make informed decisions.
The confab also provided the opportunity for real estate start-ups to share their challenges and experiences.
Trust, lack of uniformity of data, weak regulations, data hoarding on the part of government, tracking the process of land titling were some of the challenges raised by them.
Stakeholders stressed the need to widen presence in other cities such as Uyo, Onitsha, Kano, Enugu, etal, not just glued to Lagos, Abuja and Port-Harcourt.