PropTech (‘property technology’) refers to the use of digital technologies in the delivery of products and services in the real estate industry. Its primary goal is to innovate and optimize the ways in which properties are built, bought, sold, and managed. For example, artificial intelligence has been used to generate marketing materials and calculate credit scores; blockchain technologies have been employed to limit the risk of fraud; and virtual reality technologies have been applied to facilitate remote viewing and purchase.
PropTech is indeed a very broad sector, encompassing AI design tools, listing and management platforms, and smart home technologies, among other things, and it overlaps with other sectors such as FinTech (‘financial technology’) and ConTech (‘construction technology’). According to Zion Market Research, the global PropTech market size stood at US$19.5 billion in 2022 and is predicted to grow to US$32.2 billion by 2030.
In contrast to the hype in the business circle, academics studying the housing market have expressed concerns regarding the wide applications of PropTech. Desiree Fields (2022), a leading scholar on this topic, argues that PropTech has transformed housing financialization in the post-2008 era, particularly in the context of the single-family rental market where large-scale investment companies are able to exploit the US foreclosure crisis and forge a new asset class. With respect to the rising popularity of online listing platforms, Geoff Boeing, Julia Harten, and Rocio Sanchez-Moyano (2023) report that the already-advantaged communities tend to benefit more from these platforms. Moreover, Wainwright (2023) highlights that, while rental platforms claim to be objective, prejudices are usually built into their algorithmic designs. All these findings speak to the fact that PropTech has reconfigured the relationships among real estate professionals, investors, property owners, and tenants, as Joe Shaw (2020) argues.
To mitigate the negative impacts of PropTech on housing, Geoff Boeing et al. (2023) suggest that policymakers and practitioners: 1) make use of the data collected by online platforms to better understand market conditions; 2) collaborate with platform owners to improve algorithmic designs; 3) regulate platforms in terms of their data collection, processing, and usage. While these suggestions sound promising, their implementation seems challenging. Given the private nature of online platforms, they might be hesitant to share data, collaborate with the public sector, or fully comply with guidelines and regulations. Take Airbnb as an example, the platform has been accused of allowing its hosts to evade taxes and regulations and exaggerating housing crises in various localities.
Currently, there is a dearth of research on the social science aspects of PropTech, particularly its implications for equity, inclusion, and regulatory challenges. This gap could potentially be addressed by researchers specializing in development studies, science and technology studies, and urban studies. Compelling questions include, but are not limited to: How does the adoption of PropTech impact housing accessibility and affordability, particularly for disadvantaged groups? How does PropTech influence the dynamics of property ownership, rental markets, and housing finance? How does PropTech shape the global landscape of real estate in terms of the flow of investment, policies, and technologies? Please reach out if you are interested to discuss these questions further.
ICTs for Development 