The pandemic has not left any industry untouched, and construction and real estate have equally taken a hard beating. Rating agency, CRISIL has estimated a 12-16% fall in construction investments this fiscal.
With construction activities deferred, the revenue in the sector is expected to plunge by 13-17%. Experts and analysts have anticipated muted growth and fewer new projects for the housing sector.
However, the beleaguered industry is banking on online selling to turn the fortune around. One would have never thought that a click of the mouse could become a means to stimulate the ailing real estate.
While in most other markets, technology has long been embraced to support and aid the real estate sector –India has been a laggard on this front. However, it has quickly come to realize the significance and implications of using technologies like PropTech, Virtual Reality (VR), Artificial Intelligence(AI), Internet of Things(IoT), and Cloud Computing for the development and betterment of the sector.
Nimish Gupta FRICS, Managing Director (South Asia), Royal Institution of Chartered Surveyors(RICS), told The Blue Circle that the importance of technology couldn’t be more evident than in the present conditions, where we need to ensure business continuity and employee safety.
“The COVID pandemic has created a situation where the reliance on technology will be manifold and for the sector to revive and thrive, its deployment is crucial,” said Gupta.
Making a Digital Presence
The digital mark of the real estate industry is still new. Although company websites have been around for years, people have always preferred offline modes– be it word-of-mouth, a known developer, or newspaper advertisements. Online was earlier limited to rental property or for initial prospects.
But realty firms post lockdown have experienced a boom in the online property sales and realise that the trend is here to stay. If the product meets the requirements of customers, even high-end buyers will not be hesitant to buy property online. The pandemic has highlighted the benefits of digital platforms and accelerated the use of technology to build an almost on-site experience for the customers.
Prateek Rathee, Founder, Homezop shared with TBC that giving people a real-time experience of the sites and in-house mapping of the location with the precise conditions around the site is important for buyers to understand the dynamics of the place well.
Homes are now being sold as a commodity with product displays, social media plug-ins, and blogs. The online payment of loans has minimised the trips of both, the developer and the buyer. The recent reduction in interest rates and possible reduction in prices, coupled with work-from-home requirements have made people realise that having a spacious home is not only needed but could be a safe investment option too.
Realty Transforms to Virtual
The online mode of site visits was initially introduced for Non- Resident Indians (NRIs) to eliminate the hassle of repeated site trips from other countries.
The pandemic has led to a transformation in digital platforms and motivated developers to invest in enriching the real estate experience for buyers.
“Even before the onset of COVID, there was enough and more evidence for the sector to embrace technology with open arms – given its huge potential in reducing time, cost and effort on projects; data accumulation, storage, and analyses to make processes efficient,” said Gupta. He further added that the current situation is only an unfortunate catalyst that has ‘driven that point home’ much harder.
Considering that physical site visits are difficult in the current situation, developers and start-ups have opted for tech-led solutions to woo the buyers – from making their content online, to online customer interaction, virtual tours or site visits, and video chats, among others. Video walkthroughs and digital inspections are increasingly becoming popular, allowing home buyers to see every part of the residence, from the floor plan to outside view.
As the on-site interactions have reduced due to social distancing norms and more focus is on hygiene, customers are keen on using online as a method of seeking information on the projects and closing the deal. “The conversion rates of people who visit sites and eventually buy homes have increased,” said Rathee.
Each player is introducing new ways to interact with customers, as common customer meets have turned from the halls and auditoriums to the screen of the desktops. Some developers have taken the route of live webinars on their website to discover the price and book projects online. Digital platforms like Zoom, Skype, Microsoft Teams have been at the heart of these interactions. Big realty firms are using VR, automation, and analytics to make things smooth for their customers.
Technological innovations such as Building Information Modelling (BIM), 3D printing, drone surveying, cloud-based project management are expected to enhance customer experience and build quality. AI complemented with drones is being used in the early stages of construction to survey a proposed construction site and gather enough information to create 3D maps, blueprints, and construction plans. Blockchain is being increasingly adopted to address the concerns of real estate by replacing the local estate records as the primary channel of property title information.
“To have a more rounded acceptance of technology, it is advisable that professional help be sought to do a seamless transformation and business process re-engineering,” advised Gupta.
It is evident that technology is opening doors to new avenues and fresh possibilities, and the sector is slowly embracing it. This is expected to stimulate investments into digital and innovation to make life easy for developers as well as customers. This could be a great time for the real estate industry to push the pedal on innovation.
“While we hope that the crisis that has come forth as a consequence of the Coronavirus, does not have to be dealt with in the future, the sector and its stakeholders need to be prepared for any eventuality. Therefore, the investment in technology is advised and justified, and cannot be avoided or delayed any further,” said Gupta.
What Lies Ahead
It is believed that the Indian construction industry has traditionally been quite slow in adopting new technologies. Real estate developers have under-invested in tech-driven solutions, despite the many benefits these can provide to run and manage their construction projects.
The tech-laden construction is new to the current workforce and the lack of skilled workers has deterred the developers to pick up the technology. While many are looking to upgrade their technologies, the requirement of large capital investment has kept others in doubt. Besides, technology has always been surrounded by data and privacy concerns, which has restricted a lot of developers from investing.
Innovation not only simplifies the process but brings about more accountability and transparency in the system. But, there is still a long way to go for this sector in India, before its full potential can be tapped.
(Edited by Anu Choudary)
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