The growing need for proptech is a worldwide phenomenon. In 2012, funding for real estate technology companies reached a high of $220 million in US currency. Fast forward to May 2020, and nearly 2000 proptech companies raised a total of $50 billion in venture capital that year.
It’s a hugely important sector, but the question is, why has proptech become so popular as quickly as it has? Why is the demand so high that it brings in billions of dollars worth of investment?
The answer is a simple one. Proptech solutions have revolutionised the rental market. From online portals making it easier to promote units for rent to automated parcel rooms that keep deliveries secure, recent proptech advancements have had a significant positive impact on expenditure and convenience in the BTR and PBSA sectors.
Because of this, it’s driving more and more innovation. Fjeld Consulting alone has already brought seven new proptech solutions to the UK market in the last few years with many more on the way.
Real estate technology has become a necessity towards the smooth running of residential buildings. Below, we explain how and why proptech has changed the rental market for the better.
What is Proptech?
Proptech is short for property technology. It’s through proptech that residential operators can automate running procedures to manage their buildings with greater ease, efficiency and flexibility. While they serve a major purpose for BTR and PBSA site teams, proptech solutions also provide residents with a better living experience.
Real estate technology can come in many different forms, from mobile apps that replace keys and fobs for building access to management services that will help you stay in control of your vendor contracts.
There’s no limit to how far technology can advance the running of residential buildings. As the rental market continues to change and new technology is invented, there will always be new innovations on the horizon.
How Do Proptech Solutions Benefit Residential Property Managers?
Residential operators have a lot of responsibilities. While the site team is instrumental to the overall success of a development, it’s the building manager who is ultimately responsible for ensuring operations run smoothly by:
- Monitoring resident and staff happiness/wellbeing
- Keeping costs low
- Keeping the building at capacity
- Scheduling repairs and maintenance to name just a few
It’s a lot for one person to take on, which is why relying on proptech takes away a significant portion of day-to-day stress. Some of the key ways our own technology helps residential operators include:
Efficient Operational Expenditure
Running a residential building can be costly. Investors want their money to be put to good use, but without proptech solutions on hand, it’s difficult to pinpoint where funds should be directed.
A good example of this is in regards to security.
At night, the only staff members usually onsight are the security guards. They often write down the night’s events in a logbook, but this outdated method of communication between security and the day-shift team leads to many issues being overlooked. Logbooks can solve short-term problems, but they can’t effectively track long-term trends.
Let’s say a guard patrolling a section of the building is constantly handling disturbances, yet another guard rarely reports any difficulties in their area of the development. Using a proptech solution such as Propsecured, it makes spotting these trends much easier. With the data you’ve gathered from the electronic security logging system, you can then rethink how to use the resources available more effectively.
In the scenario above, you may decide the best option is to reassign the guard who doesn’t encounter disturbances alongside the guard who does to take the pressure off where it’s needed. You may also consider installing a security camera as an added deterrent and to capture evidence that you could later rely on.
The more data you gather, the more intelligent decisions you can make, so always ensure you’re collecting information. Then, you’ll be able to use your funds efficiently and effectively.
Delivering on the Needs of Residents
The key to success in BTR and PBSA is ensuring the needs of your residents are catered to. The more you can do to facilitate this, the greater your chances are of having residents sign a new lease when their current contract expires. In turn, this will:
- Minimise revenue losses due to void periods
- Save time and money on finding a replacement resident
- Allow your customer service specialists to continue building an established connection with a resident in situ
According to Knight Frank and UCAS, 93% of students said value for money was important to them when deciding where to live, so delivering on needs and expectations will always be a critical factor.
However, determining what their needs and expectations are isn’t always simple. As an example, many residential buildings have gyms for residents to use with the costs covered in rental fees, but what percentage of your residents use the gym on a regular basis?
Not all amenities provide residents with a real value for money. Yes, many will expect a gym, but if it doesn’t cover their needs, is it the best use of space and funds?
A secure parcel collection service is the most commonly asked for amenity from private renters. Residents aren’t available every minute of the day, but they don’t want to miss a delivery. Online shopping increased by 174% between May 2019 and May 2020, and the amount of internet retail sales has remained steady ever since. A smart parcel room is wanted and needed to give residents true value for money.
The right software keeps a parcel room completely secure through:
- One-time-only access codes
- 24-hour CCTV coverage
- A full electronic logging and tracking system
This level of package security alongside push notifications to alert residents of their delivery has proven to be highly effective and universally enjoyed by residents and site teams.
Proptech solutions allow you to deliver on a resident’s needs in ways you might not even have thought of, so it’s always worth keeping up with the latest innovations.
Join the Revolution
Proptech isn’t the future of the rental market; it’s the present. The need for innovative solutions is already on us, and it’s vital that your residential building doesn’t fall behind on the times.
Fjeld Consulting is one of the very few companies operating in the UK with decades worth of experience in this sector through our time spent working in the American market. We know how much of a difference the right proptech solutions can make for your residents and to keep your development running as efficiently as possible.