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Guest Blog: How PropTech has taken property paperless

By Nitin Aggarwal, founder and CEO of Property Deals Insight

It’s only a few years ago when carrying out due diligence before making a property purchase was a long tedious process. Property investors found a juicy deal and then started the tedious process of researching the property.

  • Is the price reasonable compared to other similar properties locally?
  • What’s the going rate for rentals in the area?
  • How long will it take to get the investment out of the deal?
  • What will it cost to maintain month-by-month and year-by-year?
  • What will it cost to refurbish it to increase the value significantly?
  • Does the per square metre cost stack up with other properties in the area?
  • What are property prices doing in this location?

The list of things you need to know to make an informed buying decision is a long one.

Most investors get out their notebook and start looking into all this step-by-step. And it takes time. The information is not all in one place, you need to consult many sources – not all of them easily accessible with a couple of clicks online.

Investors with multiple properties will have a file on every property they own – with all that due diligence in one place.

A wing and prayer

Some investors have tried operating on their ‘gut instinct’ and closed deals without doing all that background work. Some of them have been lucky – but more of them have closed on deals that are actually too good to be true and lost their shirt.

Ignore the research at your peril.

Yes, it will take time and the process from finding a deal to completion will be slower as a result. But it’s worth it to protect your investment.

And then there was PropTech

Over the years the property world has been invaded by a wide range of technology that makes the process of buying a property much easier.

  • Big property sites like RightMove and Zoopla make finding properties anywhere really easy.
  • Virtual viewing came into its own during the lockdown, allowing people to ‘walk around’ a property virtually.
  • Property analytics can be accessed online to allow investors to get all the information about a potential property purchase in just a few clicks.
  • The financial aspects of property are all digital – now more cheques or visits to the bank manager, it can all be done online.

There are some areas of property where technology is still not quite there – legal tech isn’t yet at the point where searches and conveyancing can be wholly automated. AI has not yet fully entered the lenders’ world – although it’s coming.

What does this mean for property investors?

As the saying goes ‘time is money’ and the time it used to take to find and purchase a property has been cut down to a few weeks (or even hours), rather than several months.

Instead a folder stuffed with paper, everything is available with a few clicks on a laptop or even a smartphone.

The things that take longest are the mortgage process and the conveyancing – and the speed at which PropTech is advancing will, inevitably, transform these sectors too before long.

The fallout from the pandemic was evident in that the property market, despite negative predictions, actually stayed buoyant and the smart people in the property markets moved rapidly into digital alternatives.

Credit checks are digital, property details are available in pdf format (or on a website) and even contracts can be signed digitally.

The ability to save time and money will make most property investors very happy – but in 2022 there are other factors in play, one of the biggest hot topics is the environment. Being able to reduce your carbon footprint gives you lots of brownie points and PropTech means less travelling and less paper.

PropTech is making property investment a mostly digital activity.