Fintech will give us more data about our properties and help us make better purchases
"We're wandering into these huge property assets with no idea about what's going on."
How much do you really know about a property you're buying? How much does it cost to heat and cool? When was the building last inspected? There's not really much data available.
This makes it hard for homebuyers to make wise decisions, and it makes property valuations less accurate.
But new forms of financial tech are set to change that.
"There's going to be increasing convergence of understanding property value and the cost of running a house," said Insight Data Solutions COO Mike Thanos this afternoon at an Intersekt 2019 panel on fintech and the disruption of property and energy markets.
"You hear stories about people who get nasty shocks after they've been living in a house for six months and they find out that it's a very expensive place to live in apart from the mortgage repayments… there's not very good data available around that."
This was the panel's central theme: better use of data will tell people more about their homes, such as their energy consumption patterns and the energy efficiency of their homes. This data can in turn provide a more accurate picture of a property's value.
And yes, a lot of this will involve the blockchain (read this guide if, like me, you're a bit confused about what blockchain really means).
Power Ledger Crypto Economist Anya Nova emphasised that decentralised energy technology, such as home solar systems, allows people to not only monitor their energy consumption but "actually sell that energy at a market price" and effectively "monetise their own homes."
"How people look at property is changing and how they assess their value is changing," Nova said.
Some of these innovations will require new regulations from government, but others simply require a more consumer-friendly adoption of information that's already available.
"You can go and download your smart meter data from the government for free," Thanos said. "You can upload it to a free website and comparison shop. I'd love to see those data feeds made available at an aggregated level so that people can start to use it to better understand the value of property."
By creating a decentralised, fast and secure validation and storage of information, blockchain technology can also change how we record information about property.
Regional Chair for the Foundation for International Blockchain and Real Estate Expertise Gordon Christian said he's most excited about companies "getting all the information out of a smart building, that information coming out and... being recorded on the blockchain, which will then be used to properly value buildings".
In other words, buildings with smart technology produce data, which in turn can be properly stored through secure blockchain technology and provide a much more detailed picture of a property.
"We buy a house, we really don't know anything about that house. When did it have its last building inspection? Did it get flooded once before? We're wandering into these huge property assets with no idea about what's going on," said Christian. "This technology brings everything together. There's a history of the lifecycle of the property right through from day one to day finish."
These innovations will impact mortgage lending, energy, home insurance and many other industries.
Of course, not every building is a "smart building". But more homes in the future will be. And not every piece of property tech will use a blockchain. But no matter the form of the technology, the future of the property industry means more information for everyone and that's a good thing.
