Hamilton Fraser | Education

The role of PropTech – view from Eddie Hooker

I am fascinated by the role that new and innovative technology is having on the Private Rental Sector (PRS) – not just with the ways in which the market is changing but indeed also the conversations surrounding it.

A few weeks ago I released a ‘white paper’ looking to open up the discussion on No Deposit products because, as I emphasised in the paper, I had some concerns – not about the technology but more about the behaviour and moral issues surrounding replacing traditional deposits with an alternative. It must be said, the response I received was largely positive and constructive. Whether those that reached out to me agreed or disagreed with my challenges it is clear that most of these products share my drive to improve the market. What’s more surprising is that a fair few who spoke to me are already looking to innovate on the already innovative alternative to deposits!

The response from the paper got me thinking about the role and objective of technology in the sector. I must admit, much of my motivation for opening up the debate was the apparent public silence from most of the established players in the PRS on almost all things PropTech and therefore I wanted to explore it further, for no other reason than to learn more myself.

I’m not a ‘techy’ by any stretch of the imagination, however my perspective on PropTech does come from my experiences from other parts of my life that tech has changed. I personally believe that tech, more often than not, isn’t really about revolution but more about the experience the consumer has. Rather than reinventing the wheel, technology should be an enabler for more efficient human interactions. Let me explain with a few examples:

Take Amazon to start. Is their product REALLY that innovative? I still have to browse, choose and purchase the product I want. However, now I receive almost daily deliveries for products ranging from gadgets, to clothes, to toys and even toiletries without having to leave the comfort of my own home. With their recent foray into the world of groceries who’s to say I won’t also do my weekly shop there too.  Shopping is still shopping but, for me, just more pleasurable!

Uber is another good example. I don’t really think that hard into the tech behind their app, instead I just appreciate I can get from A to B in what feels like a more efficient manner. Do I care about the algorithms behind their ratings systems?  Instead I just appreciate the ease of it all: payments linked to my Paypal account, not having to persuade anyone to take me further than they want to and drivers letting me play my own music! The role of Uber and its most basic function – taxiing me whenever and wherever I want to go – is fundamentally no different to every other taxi I used to use, however it is an experience that works better for me. Uber didn’t replace the taxi, they just made it better!

I think the most fitting example is the social trends we are seeing. Led by the likes of Facebook, Twitter, Instagram, Snapchat, LinkedIn – and to a certain extent Apple – we humans interact very different to even just 10-15 years ago.  I can’t claim to use all these newfangled platforms however their role is clear. Rather than create new social interactions they enable more efficient and expansive experiences. Rather than print off holiday snaps and show them to family and friends they can now live the experiences with me real time by posting photos on social media or even broadcasting them via FaceTime or Facebook Live. Rather than texting multiple people I can now join or create a group.  I’ve even managed to track down my long lost band members of my youth and relive recordings we made in times gone by. Of course this example would still have been possible without tech – but tech has enabled me to reach out with relative ease.

The point I am making is that it is not the role for tech to always invent new ways of doing things. The most successful tech makes the interactions on existing behaviour more efficient and more consumer friendly. Love them or loath them, Purplebricks have built a successful brand by taking the existing model and adjusting it slightly to cater for a demographic disenchanted by the traditional model of estate agency. You still buy or rent a house but for many it just feels that much easier and accessible. Perhaps this is where some of the early online adopters initially struggled to gain traction – they set out to publicly destroy the existing industry rather than focus on how they could make the lives of their consumers easier.  They tried to tell us that our behaviour was wrong and that we were all being ripped off and that they had the solution to everything.  Online agency is not for everyone but they can co-exist with the more traditional agency approach.

The often wrongly attributed Darwinian quote rings true – “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change”. Whoever did say that probably did not have the Private Rented Sector in mind, however it is extremely apt.

Innovation is something that my company, Hamilton Fraser, takes very seriously and was recognised when we were inducted into last year’s CityAM/Mishcon Leap 100 list. We have an extremely innovative pipeline with development into streamlining deposit protection underway, as well as new products and platforms aimed at helping landlords on their journey. We are also looking into tech alternatives but ONLY if it improves the consumer experience for the majority.

The important thing to remember is innovation can come from established brands, not just ambitious start-ups. The Private Rental Sector is, ultimately, a people game and if we can use tech to improve the experiences of the consumer we will all be winners.

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