Top of the day to you folks, I trust you are keeping well. Today we conclude the discussion we started last week on how Proptech can support housing delivery in Ghana. By way of a quick refresh, we mentioned that Proptech is an acronym used to describe any technology or platform in the real estate space that ensures efficient project management, construction, funding as well as property sales and renting throughout the building’s life cycle.
It is reported by statista that globally, there are now more than 6,000 proptech businesses and investments increased from $2bn in 2013 to $18bn. We also looked at some of the success models on the continent with some of the key highlights being 14Trees who make use of proptech through deploying 3D printing technology at scale to build affordable and low-carbon housing and schools in Africa. The potential for proptech to disrupt our local real estate market with specific focus on housing delivery is quite high especially in the areas evaluated below.
Real Estate Development
Gone will be the days when intuition and historical data like location specific prices, rent and occupancy rates etc. will form the basis of real estate developers’ choice of site, project types and level of investment. In the Proptech world, big data will not only show current traffic trends from GPS for instance but can also predict how the area will be affected by migration, weather patterns etc.
This information will then arm developers to design, construct and maintain properties or structures that are well curated for those specific environments instead of a size fits all approach. With technology facilitating these assessments, decisions will be speedier and structures more robust.
Ever head of one of the most curious reasons for rejection of funding proposals from the big finance houses? That your project size is too small? Yes, too small for them to do business with you. The old traditional model dictates that to fund property development, you, a property developer will have to go through either the traditional banking system and approach private investors with attendant red tape, bureaucracy and unreasonably high interest rates.
If you are to build in your individual capacity, you will have to save till you are grey or build in ‘tot’ over 10 -15 years on the average. Well gone are those days as Proptech is ensuring that there are platforms you can upload your projects on for quick assessment and access. They are called crowd funding platforms and the exciting thing about them is that you are unlikely to be given that famous line – your project ticket size is too small. you can access from as “little” as US$25,000 to US$500,000. Exciting times!
Monthly Rent Payments
Stories of paying moving fees to several agents for months on end just to find an apartment in some hideout on the outskirts of the city with a one- or two-year advance payment is a familiar one. You would also may have heard that payments have been made to ghost landlords or agents who bolt with cash. It is also not out of place to hear stories from landlords complaining of having troublesome tenants who destroy fixtures, disturb peace or fail to make due payments.
These stories with the advent of proptech will be a thing of the past as platforms to enable speedier, safer and more flexible rentals made become the order of the day. Both landlord and tenants will be qualified or subjected to diligent verification, including check of their IDs, referees, employment status, and income status. The tenant for instance is rid of a big headache of paying 1-2 years advance and instead pays monthly rent “small small” as we say.
It all sounds cool right?
The writer is the Executive director of Yecham Property Consult
& Founder of Ghana Green Building Summit.
Email: [email protected]
Linkedin: Cyril Nii Ayitey Tetteh