Can PropTech finally bring real estate into the future?
By Pavlos Loizou, CEO of Ask Wire The real estate industry has long been known for its slow adoption of technology. Despite the significant advancements in PropTech—offering everything from real-time data analytics to automated valuation mode
By Pavlos Loizou, CEO of Ask Wire
The real estate industry has long been known for its slow adoption of technology. Despite the significant advancements in PropTech—offering everything from real-time data analytics to automated valuation models (AVMs)—the infrastructure that underpins much of the industry remains outdated.
At a recent PropTech panel discussion, two speakers addressed this issue using different but complementary metaphors.
The first compared the real estate sector to an old computer running on obsolete hardware, while PropTech companies are racing ahead with cutting-edge software.
The second called for a “sandbox” mechanism to encourage experimentation and foster collaboration between start-ups and larger institutions.
These perspectives shed light on two key barriers to innovation in real estate: the outdated infrastructure that slows down progress and the inherent risk aversion of larger players in the industry.
Both of these need to be addressed if PropTech is to fulfil its potential.
The Industry as Outdated Hardware
One speaker at the panel likened the real estate industry to a Pentium computer running on Windows XP—antiquated and no longer capable of meeting modern demands.
PropTech companies, in contrast, are offering advanced “software” in the form of AI, machine learning, and data-driven insights. Yet, this new software cannot run effectively without upgrading the underlying hardware.
Take the example of Cyprus, where property transactions are still bogged down by manual processes. Legal documents require physical stamps, approvals are slow, and data is siloed in various government departments.
PropTech companies, like Ask Wire, have the capability to streamline these processes through automation, real-time data, and integrated platforms, but the infrastructure is not ready to support these advancements.
Even in Greece, where economic recovery has sparked increased foreign investment in real estate, the underlying processes remain outdated.
While the government is making efforts to modernize, many real estate transactions still require significant manual input, creating a bottleneck for technology adoption.
Romania presents a similar challenge. Despite rapid urbanization and a growing economy, the real estate sector is held back by inefficient systems that are not yet ready to integrate with the advanced tools that PropTech can offer.
This gap between what is technologically possible and what the industry is prepared to adopt is a recurring theme across many markets, not just in these three countries.
A Case Study: Ask Wire’s Real-Time Data Tools
Ask Wire, for instance, provides a suite of data-driven tools that offer real-time market intelligence, automated valuations, and environmental risk assessments.
These tools could revolutionize how properties are bought, sold, and managed.
However, the willingness to embrace such innovations is often limited by the sector’s attachment to traditional methods.
For example, in Cyprus and Greece, real estate stakeholders are often hesitant to rely on automated valuation models (AVMs), despite their accuracy and efficiency.
Many still prefer manual appraisals, which are time-consuming and prone to human error. In an ideal scenario, data analytics could replace outdated, labour-intensive processes, providing faster and more accurate insights.
But in reality, the sector’s reliance on old systems makes the adoption of these tools a slow process.
The Sandbox Solution: A Path Forward
The second speaker at the panel proposed a different solution: the creation of a “sandbox” where PropTech innovations can be tested in a controlled environment.
In this metaphor, the sandbox serves as a safe space where new technologies can be trialled without the risk of full-scale failure.
This would allow both start-ups and larger institutions—whether government bodies or big real estate firms—to collaborate without the fear of catastrophic loss.
This model has already proven successful in other industries. In the UK, for instance, the Financial Conduct Authority (FCA) has implemented a regulatory sandbox for FinTech companies.
By allowing start-ups to test their solutions under regulatory supervision, the FCA has fostered innovation while protecting consumers and larger financial institutions from unnecessary risk.
A similar approach could work well in the PropTech space. For example, in Cyprus, a sandbox could allow PropTech companies to pilot digital property registration or blockchain-based ownership verification systems, demonstrating their effectiveness without forcing the government or larger corporations to fully commit from the outset.
In Greece, where the government is already working to digitalize many sectors, a sandbox could accelerate these efforts by providing a platform for PropTech companies to work alongside public bodies, testing solutions that could streamline real estate transactions or automate regulatory compliance.
Romania, with its rapidly urbanizing cities and strong tech sector, is another ideal candidate for a sandbox model.
By allowing PropTech companies to pilot solutions aimed at managing urban growth, data collection, and property transactions, Romania could leverage its tech expertise to modernize its real estate sector more quickly.
The Reluctance to Adopt: Risk and Legacy Systems
Why is there so much hesitation around adopting PropTech solutions, even when they promise clear benefits? Part of the issue is risk aversion.
Large companies and government bodies are often unwilling to engage with start-ups because they fear the unknown—what if the start-up goes bust?
What if the technology doesn’t deliver as promised? This reluctance creates a “chicken and egg” problem: start-ups need large companies to adopt their technology to scale, but large companies are hesitant to engage unless the start-up has already proven itself.
The sandbox approach helps address this by allowing both sides to engage in low-risk experimentation.
Start-ups can prove their technology, and larger institutions can test its impact without committing to a full-scale rollout.
Successful tests can lead to broader adoption, providing a stepping stone for larger reforms across the industry.
Conclusion: Cyprus, Greece, and Romania as Ideal Testing Grounds
Cyprus, Greece, and Romania each have unique characteristics that make them well-suited for PropTech innovation.
Cyprus, with its high dependence on real estate (17 per cent of GDP) and growing tech sector (15 per cent), offers an ideal environment to blend the two. Its small size also makes it a perfect sandbox for testing new ideas before scaling them.
Greece, in the midst of economic recovery, is seeing significant foreign investment in real estate. The government’s ongoing modernization efforts, combined with the need for more efficient real estate processes, make it a fertile ground for PropTech experimentation.
Romania, one of the fastest-growing economies in Europe, is undergoing rapid urbanization. Its large tech sector and increasing demand for real estate solutions position it as an ideal market for PropTech adoption.
The real estate sector in these countries is poised for transformation, but for that to happen, both infrastructure modernization and a culture of experimentation are needed.
The sandbox approach offers a practical way to bridge the gap between outdated systems and cutting-edge technology.
By fostering collaboration and reducing risk, these countries can lead the way in PropTech adoption, paving the way for a more efficient, data-driven future in real estate.
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