The main directions for IT startups in the field of real estate sales
The real estate market is currently experiencing hard times - the purchasing power of the population is falling, stagnation is underway. Companies are increasingly thinking about attracting startups. One of these companies, operating in both the primary and secondary markets, asked me a question - which technology startups can help them. 
To get the full answer, I had to study and summarize several hundred startups and IT solutions used in the real estate markets of Europe, the USA and Russia. The first part of the answer regarding sales processes, I give below.
Note: In order not to list endless projects and services, I have summarized them in 4 main areas. For each area I will indicate the level of development of the used IT technologies (according to Gartner) and the prevalence of IT solutions. In the "Recommendations" section, I offer my vision of the prospects of creating an independent startup in this area.
A simple way to increase sales is to expand territorial restrictions for buyers and reduce the minimum amount of entry. Partial purchase is mainly applied to objects with a highly liquid area: business centers and rental housing, such as student campuses.
Examples of startups and projects:
Technologies and solutions used:
BlockChain technology in 2017 experienced the peak of hype and is in the “Trough of Disillusionment” phase.
A promising market, with existing (worldwide) technological solutions. Unfortunately, the practice of use is still small. Legislation regarding the registration of property rights impedes wide distribution.
Startups are encouraged to closely monitor legislative initiatives and explore the possibility of legal use of blockchain. As soon as such an opportunity is legally confirmed, the demand for such projects will be enormous.
Today, a real estate company must have a website adapted for smartphones, and possibly even its own mobile application. Otherwise, in a world where two-thirds of users access the Internet from phones ( 69.3% in the whole world ), you simply cannot survive.
Dry descriptions and photos of objects are no longer enough. Advertising business card sites that carry a minimum of factual information and staged designer photos surely lose the competition. The standard is to provide online detailed information about the proposal and its uniqueness, such as:
In addition to detailed information, reports can be provided, for example:
These analytical reports can be directed both at the buyer and the seller, allowing the latter to ensure a quick sale by making a discount from the market.
The secondary market, in terms of working with information, has features. Several of the reviewed startups grew on one single service - providing 100% reliable information on the object (relevance, reliability and legality of the placement).
Most negative customer reviews are written specifically about these inconsistencies.
Examples of startups and projects:
Technologies and solutions used:
BigData, Virtual Reality, Integration Solutions are mature technologies, often having even several fundamentally different implementation methods (for example, deploy Data Integration Tools themselves or use Integration Platform as a Service, iPaaS). In such an abundance, the problem will not be the search for suitable solutions, but the choice between them.
The US market already has several strong players in this area, it is impossible to compete with them. Nevertheless, it is possible to launch startups that solve one or more of these tasks on large public data and then sell them to strategic players.
In the local markets of Europe, full-featured solutions could not be found, the level of projects found is low.
In Russia, there are several major players, decisions are more mature than in Europe, but do not reach the level of visionaries from the United States.
A good opportunity for a startup will be to try out models that are successfully used in the USA in Russia and Europe.
In the process of acquiring real estate, the client does not want to regularly check mail for new offers, call the telephone number indicated on the booklet, or invite contractors to evaluate the upcoming repair. An omnichannel single-window service with integration with third-party, including government, services will be optimal. So, when purchasing in one application / website, the following documents must be available: documents of title, specialized forms for sale, expert assessment of the condition, assessment of the necessary costs, the sum of the costs of utility bills, etc.
Examples of startups and projects:
Technologies and solutions used:
Omnichannel CRM, Integration Solutions, Electronic document management solutions have been applied for a sufficient time, they have more than a decade of history.
The area is fully provided by Enterprise solutions, for startups it seems not attractive, except, perhaps, solutions in the field of virtual reality.
Since sales in the USA and Europe are carried out through agents, many startups are aimed at automating their activities. Effectively built work allows you to reduce the commission for transactions and win mainly the selection criteria - the price of the service.
At the same time, there is nothing innovative in such solutions; we are talking about creating mobile applications and connecting them to the back-end (WEB or ERP) provided to users in the cloud (Cloud).
The following operations are subject to automation:
In Russia, the above solutions can be used to manage your own employees.
The second possible use case is the sharing of agent services for a wide range of people while maintaining full control over their actions.
Examples of startups and projects:
Used technologies and solutions:
SaaS CRM, Cloud Solution, Integration Solutions have been used for a long time, have a wide distribution and a rich history of development.
The area is fully provided by Enterprise solutions, it is not attractive for startups.
In Russia, in the field of real estate, the most attractive investment in startups in the areas of:
To get the full answer, I had to study and summarize several hundred startups and IT solutions used in the real estate markets of Europe, the USA and Russia. The first part of the answer regarding sales processes, I give below.
Note: In order not to list endless projects and services, I have summarized them in 4 main areas. For each area I will indicate the level of development of the used IT technologies (according to Gartner) and the prevalence of IT solutions. In the "Recommendations" section, I offer my vision of the prospects of creating an independent startup in this area.
1. Co-financing
A simple way to increase sales is to expand territorial restrictions for buyers and reduce the minimum amount of entry. Partial purchase is mainly applied to objects with a highly liquid area: business centers and rental housing, such as student campuses.
Examples of startups and projects:
- blockimmo - the acquisition and joint ownership of real estate in Liechtenstein, confirmed by applicable law.
- Crowdvilla - an investment in villas for rent in Malaysia.
- ATLANT - a joint investment in real estate through cryptocurrency mechanisms.
Technologies and solutions used:
BlockChain technology in 2017 experienced the peak of hype and is in the “Trough of Disillusionment” phase.
Recommendations
A promising market, with existing (worldwide) technological solutions. Unfortunately, the practice of use is still small. Legislation regarding the registration of property rights impedes wide distribution.
Startups are encouraged to closely monitor legislative initiatives and explore the possibility of legal use of blockchain. As soon as such an opportunity is legally confirmed, the demand for such projects will be enormous.
2. Information accessibility
Today, a real estate company must have a website adapted for smartphones, and possibly even its own mobile application. Otherwise, in a world where two-thirds of users access the Internet from phones ( 69.3% in the whole world ), you simply cannot survive.
Dry descriptions and photos of objects are no longer enough. Advertising business card sites that carry a minimum of factual information and staged designer photos surely lose the competition. The standard is to provide online detailed information about the proposal and its uniqueness, such as:
- crime rate in the housing area,
- the presence of a number of educational institutions, links to them and their ratings,
- nearby stores
- availability of parking lots and their availability,
- places for walking and playgrounds
- integration with street view services,
- visualization of objects (if objects have not yet been built) and panoramic photos (if objects already exist).
In addition to detailed information, reports can be provided, for example:
- real estate price dynamics (in relation to the area of housing and land),
- rental price dynamics,
- depersonalized data on recent transactions,
- dependence of prices on amenities - land area (for houses with a land plot),
- deferred demand / availability of applications.
These analytical reports can be directed both at the buyer and the seller, allowing the latter to ensure a quick sale by making a discount from the market.
The secondary market, in terms of working with information, has features. Several of the reviewed startups grew on one single service - providing 100% reliable information on the object (relevance, reliability and legality of the placement).
Most negative customer reviews are written specifically about these inconsistencies.
Examples of startups and projects:
- Trulia is a Zillow-owned project with the most structured and comprehensive description of residential properties.
- HomeSnap is a site and mobile application that provides, in addition to photographs, a history of an object, an assessment of its attractiveness, a description of its location, as well as information about the infrastructure around it.
- Openlistings is a platform that allows the seller to independently present the object and thereby avoid double commission and also presents analytics on the local real estate market.
- Transported VR - use of panoramic 3D shooting and VR to demonstrate objects.
Technologies and solutions used:
BigData, Virtual Reality, Integration Solutions are mature technologies, often having even several fundamentally different implementation methods (for example, deploy Data Integration Tools themselves or use Integration Platform as a Service, iPaaS). In such an abundance, the problem will not be the search for suitable solutions, but the choice between them.
Recommendations
The US market already has several strong players in this area, it is impossible to compete with them. Nevertheless, it is possible to launch startups that solve one or more of these tasks on large public data and then sell them to strategic players.
In the local markets of Europe, full-featured solutions could not be found, the level of projects found is low.
In Russia, there are several major players, decisions are more mature than in Europe, but do not reach the level of visionaries from the United States.
A good opportunity for a startup will be to try out models that are successfully used in the USA in Russia and Europe.
3. Communications and customer service
In the process of acquiring real estate, the client does not want to regularly check mail for new offers, call the telephone number indicated on the booklet, or invite contractors to evaluate the upcoming repair. An omnichannel single-window service with integration with third-party, including government, services will be optimal. So, when purchasing in one application / website, the following documents must be available: documents of title, specialized forms for sale, expert assessment of the condition, assessment of the necessary costs, the sum of the costs of utility bills, etc.
Examples of startups and projects:
- Zumper select - provides selection of housing for the declared budget, taking into account all the needs of the client. It provides a full service for the client (long-term rental in the USA is quite complicated and requires the collection and execution of a large number of documents).
- Riley is a very small service that automates the only function - managing communications with clients via SMS.
- Eye spy 360 - allows you to independently take a panorama of the room and can be integrated into third-party applications for quick preliminary demonstration of the object.
Technologies and solutions used:
Omnichannel CRM, Integration Solutions, Electronic document management solutions have been applied for a sufficient time, they have more than a decade of history.
Recommendations
The area is fully provided by Enterprise solutions, for startups it seems not attractive, except, perhaps, solutions in the field of virtual reality.
4. Effective process management
Since sales in the USA and Europe are carried out through agents, many startups are aimed at automating their activities. Effectively built work allows you to reduce the commission for transactions and win mainly the selection criteria - the price of the service.
At the same time, there is nothing innovative in such solutions; we are talking about creating mobile applications and connecting them to the back-end (WEB or ERP) provided to users in the cloud (Cloud).
The following operations are subject to automation:
- various kinds of planning (meetings with the client, displays of objects, etc.),
- automatic generation of commercial offers and other mandatory documentation,
- Agent reporting
- communication agent broker (developer, seller).
In Russia, the above solutions can be used to manage your own employees.
The second possible use case is the sharing of agent services for a wide range of people while maintaining full control over their actions.
Examples of startups and projects:
- Premier Agent is a full-featured solution for automating the work of agents from one of the market leaders - Zillow.
- WiseAgent is a full-cycle solution that has been improving its services for over 15 years.
Used technologies and solutions:
SaaS CRM, Cloud Solution, Integration Solutions have been used for a long time, have a wide distribution and a rich history of development.
Recommendations
The area is fully provided by Enterprise solutions, it is not attractive for startups.
conclusions
In Russia, in the field of real estate, the most attractive investment in startups in the areas of:
- Projects in the field of big data processing (see the list in clause 2) and presenting them to clients both in integrated form and in the form of in-depth reports (easily monetized service).
- Co-financing through blockchain and cryptocurrencies - we are on the verge of a jump when the real estate market grows due to the availability of mechanisms of “folding” of the erasing borders of cities and states.
- Virtual Reality Projects