Technology is Disrupting India's $20 Billion Residential Rental Market
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Today we are in a stage where every business is going through different stages of disruption, thanks to technological advancements impacting every aspect of our lives. This growth momentum has been adding ‘e’ to various industries – e-commerce, e-mails, e-marketing, etc. There has been a massive shift in how a marketplace functions – how consumers buy & sellers sell products or services, and the real-estate industry is already catching up.
The residential rental market, which remained unregulated for the last few decades in India, is also witnessing the impact of technological advancements in a phased manner. Online home rental marketplaces have taken the market by storm, disrupting the traditional home rental business, which was dominated by brokers.
In a traditional & expensive marketplace like real-estate, the technology works as a tool that helps both homeowners and tenants, by ushering in accuracy, transparency, safety, and ease of transactions. The segment has broken into various aspects of technology like – app-based services, the blockchain, Artificial Intelligence/Machine learning, etc.
In the internet era, the residential rental space has a huge scope to obtain leads through digital media. This makes the web a major source of information when it comes to house-hunting or house-renting. The technology platforms, in the form of websites or mobile apps, are providing that wider choice for the consumers, which was unheard of before.
This has enabled the real-estate segment to break boundaries from just selling (or) renting homes, to new avenues of services like cleaning, maintenance, etc., thanks to internet marketplaces. Today, most of the urban consumers are adept at using app-based services for their requirements as a consequence of which house-hunting has taken the online format creating a win-win situation for both house-owners and prospective tenants.
Blockchain Offers Multiple Advantages:
Advances in blockchain technology have helped eliminate transactional risks and opened up the possibility of desirable regulations in the real estate market. Adoption of blockchain technology is helping ensure that the entire transaction process is fool-proof. With more accountability being rendered through digitized transactions, transparency in cash flow and pricing has set in. Payments are increasingly being automated with several players in the market offering one-click-payments.
Monetary regulation aside, there is the possibility of regulating contracts and agreements in the market with technology. The increasing promise of regulation will further address the trust deficit afflicting the market.
Artificial Intelligence (AI) has become pervasive, especially in consumer-led business. Insights into customer’s preferences, search options, and pricing have provided businesses with the advantage of understanding a customer much better than before. The same principles are now being applied to the home rental market by companies, which have been successful in deploying AI.
With the ability to effectively map the demand and supply, pricing models have become more scientific, offering tenants a range of rent-justified houses. Better forecasting of demand and supply has also helped businesses in the market build inventory more strategically, reducing the struggle to drop unsold inventory. Effective data mining has enabled the business to approach the market in a more structured and scientific manner.
With housing trends shifting from purchasing to renting, especially in the metros, rapid advancements in technology are impacting residential rental space in a smart and an efficient way. The transparency of the technology has increased customer’s trust and this trend is likely to stay.