A study from HSBC has found the UK is leading the way in online property research as 93% of prospective home buyers revealed they use online channels to enhance property search.
According to PropTech expert James Dearsley, property will be the next industry to face disruption, with property websites using technologies such as artificial intelligence and virtual reality to transform each stage of the home purchase.
Traditionally, the estate agent has played a key role in the purchasing phase of the process, however, the report has found that this part of the home buying process is increasingly moving online with less face to face interaction. More than half (51%) of recent home buyers started talking to an estate agent online as opposed to in person. The rise of property websites offering financing, negotiation and conveyancing services could see the future entire home buying process, from search to completion reduced to a matter of days.
James Dearsley had this to say: “Property websites will become considerably more sophisticated, using big data to bring more and better properties in front of prospective buyers and taking over much of the traditional estate agent’s role. There will be no more ‘fifteen minute windows’ to view a property. Virtual reality will allow home buyers to view more homes, narrow down their choice and then ‘live’ in a virtual version for several days to truly try before they buy.”
Dealing with the many people involved (estate agents, solicitors, sellers and developers) was identified by 34% of recent home buyers as the most stressful part of the home buying process, followed by understanding the legal paperwork (21%) fees (19%) and negotiating the price (16%).
These pain points have pushed home owners to use online sources first, making the purchase process much easier and reducing the number of people involved in a sale, so that buyers and sellers feel more in control.
Despite the digital trend, there is still reluctance to fully digitise the home buying experience, particularly when it comes to finance. Traditional sources such as mortgage providers (41%) and family (46%) remain the most trusted sources of mortgage advice amongst millennials. Only 14% of millennials embrace the idea of using robo-advisers such as chatbots and humanoids for mortgage advice according to HSBC’s separate Trust in Technology survey.
Tracie Pearce, HSBC UK’s Head of Mortgages, said: “The process of buying a home will change beyond recognition in the coming years. The market may not quite be ready for ‘Robo Advice’ but this type of service will, in time be helpful for the financially astute borrowers who need guidance through just a few steps of the mortgage process. There will still be those borrowers that desire face-to-face advice, or prefer to speak with an adviser over the telephone and lenders should look to provide home buyers with a choice of channels in line with their needs and preferences”
HSBC’s research identified four actions that consumers can take, to help realise their own home ambitions:
1. Empower yourself with knowledge
Ensure you make informed decisions. Make the most of online tools and services to help you to find out more about the properties and areas you are interested in and the financial options available to you.
Think about the extra things that will make the house you buy the home you want to live in, and make sure to include them in your home purchase budget.
2. Be clear on your priorities
New tools are on the way to allow you to view properties in much more detail from the comfort of your own home. With such visibility, being clear on your priorities for a property will help you narrow the search quickly and efficiently.
3. Don’t get left behind
Digitisation of property and personal information should help streamline the purchase process in future. Even if you don’t consider yourself to be tech-savvy there will still be small steps that can be taken to make the process more seamless for you.
4. Consider the experts
As buying a home becomes a more digital/online process, think about which tasks you feel comfortable doing yourself and where you may benefit from expert advice to help you navigate the home purchase process more successfully