Having worked in property the last 13 years*, I like to make the joke that I’ve done everything you can imagine with every kind of building, except owned one personally. Spending so much time dealing with property from nearly every facet has enabled me to unearth some interesting patterns and insights, including one that I find particularly simple yet powerful:
Every person and organisation goes through the same three phases of their property journey.
You first research the market to find a home, space or building, you then transact by leasing or purchasing it, and finally you manage it by living in it or utilising it. This process then starts over again. Again and again until the end of your life or your organisation’s life. I like to call these “Property Loops” or “Home Loops.”
Phases of Property Loops
- Research: you spend time in this phase researching the market, understand why you would live somewhere, or what the best transportation options are for your employees, or how many local pubs have a good enough Sunday Roast for your liking. This is quite a long period, visualised by a long line on a piece of paper or whiteboard. (The black line shown above)
- Transact: this is the “moment” or near moment that you lease or purchase a property. It is often a speck in time compared to the other two phases, so is depicted by the intersection point of the straight line and the loop. Obviously, renting a room in a houseshare which might take no longer than a few hours after a couple weeks of searching is going to be much quicker than buying a portfolio of 1,000 units in an institutional multi-family acquisition — but the point is still the same. The search duration vs the time to transact will roughly be in the same sort of ratio.
The ‘transact’ phase has gotten the most attention perennially from suppliers as well as technology companies as a lot of money changes hands in these instances. The crystallisation of value upon these transactions means they need to be done properly (legally sound), financed appropriately, and executed with proper due diligence. The bigger the deal, the more parties involved in all these various areas, and the more fees that are able to be circulated to support them. This is where the first “proptech” platforms as we know them in consumer world really got traction. From Globrix, to the Zoopla and Rightmove, to Trulia and Zillow. These platforms realised that if they could control eyeballs here — they could make huge amounts of money. Over time, they also looked backwards from the loop to try to acquire interest before buyers and sellers were ready to transact with various tools that would help during the “research” phase.
3. Manage: this is the phase where you as a tenant, asset manager, landlord, owner, managing agent have now successfully passed the transaction point and you now have a set of responsibilities as well as goals during the period in which you manage the property. Responsibilities for tenants may be extremely limited, like in a Fully Repairing and Insuring (FRI) lease where as a commercial tenant not only do you have the bills to pay, but you have to also handle all the repairs, maintenance and insuring of the property. Owner operators take on even more responsibility for a space as they operate as both landlord and tenant. Then you can go all the way down to a simple room rental agreement in a house share where all bills may be included, and your only real responsibilities are to not be a dick and make sure your payment for rent which is inclusive of utilities and all other costs is paid on time.
All real estate services companies and property technology businesses focus on one or more of these phases and can be organised into them accordingly.
In the acasa universe, we are currently focused on renters (though the platform works great for owners as well, and soon will work for 3rd parties like landlords and agents) we have customised this journey to feel more like what we all experience as consumers in the market. These are the “Property Loops” or “Home Loops” where each of us goes through the process of moving in, managing, and moving on.
- Moving in
- Managing
- Moving on
In a future post, I’ll go into further details about how each of these moments applies in the acasa user journey.
I’ve created a list of the most exciting companies in proptech, you can follow me on Twitter and check out my Proptech Platforms Twitter List to follow all of these handles together. Please send me any additions for the list so I can think about how some of these fit into the Property Loops.
Nick Katz
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*About the author:
I’ve worked in commercial real estate for 7 years as an investment broker, leasing agent, and sustainability & building operations in the United States and the United Kingdom (at Coldwell Banker Commercial, GVA, and Colliers International respectively). I then moved into property technology (#proptech) and have worked in this space for 6 years . I spent 13 months as an early employee and the executive growing Honest Buildings, a commercial real estate project management platform, into the United Kingdom and Europe. I’ve spent the last 3.5 years with my own business, acasa, focused on consumer home management, payments and utilities. Even my parents also have had a part to play in my obsession with property as my father is an architect and mother a landscape designer.