Cyberworld converges with bricks and mortar converge
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The transformative impact of new technology has not only hit music, movies, hospitality and retail, it’s now taking Cambodia’s real estate industry by storm and streamlining the way it does business.
New couples and tech-savvy millennials are finding it essential to stay abreast with evolving tech trends.
The Cambodian property market will continue to move online and use the cyberworld to better position their businesses and lower costs, says Tom O’Sullivan (chief executive officer (CEO) and director of Realestate.com.kh.
“Certainly, we see a lot more agents and developers using technology to market their properties in Cambodia these days,” O’Sullivan adds. He says this is a combination of a few factors.
First, internet penetration is now at 76 percent, compared with 11 percent in 2016 for example, which tells us that three-quarters of the population now find information online.
Second, he says, with the increase of employment in general, and most certainly among the middle class, more people are looking for housing. However, these people tend to be time-poor and tech-savvy so therefore it’s quicker to find the property they are looking for online as opposed to having to drive around during their weekends looking for potential homes.
Third, technology is one of the only ways an international investor can find information about the Cambodian property market before he or she arrives here.
O’Sullivan says that 50 percent of his company’s traffic is from overseas.
Tech helps on multiple fronts
“At realestate.com.kh for example, we have powered 60 plus agencies with a real estate customer relationship management (CRM) which helps them manage properties, marketing, teams and reports,” says O’Sullivan.
“This has traditionally been done on Excel and pieces of paper. Generally, technology in real estate is extremely positive for the market. It helps on multiple fronts,” O’Sullivan adds.
O’Sullivan says that websites such as realestate.com.kh help increase transparency in a real estate market as well as bringing all the property in the market together in one place.
He adds increased use of drones, interactive and 360 -degree tours also add to making the property search experience much better, easier and more informative for a home seeker.
Online platforms make it simple to search the whole market. Property management apps make it a more convenient experience for tenants and make it easier to manage a building, while agency and developer tools such as customer relationship management (CRM) makes it easier to manage the entire business, says O’Sullivan.
“I think we have already witnessed a remarkable change in the real estate sector as a result of technological change and advancement,” he adds.
Kim Heang, CEO of Khmer Real Estate and regional operating principal of Keller Williams Cambodia, said at the workshop of the Update of Real Estate Sector in November that Cambodia’s real estate market is growing well and fast with the presence of new technology.
“New technology has become part of boosting the market effectively from searching for information, investment and promotion as well as from sales and purchases,” says Kim.
He adds that digital technology makes business, sales and communication more efficient.
“The digital and technology sector has become a necessary part of pushing the sales of a property effectively,” he said.
Cambodia Properties Ltd (CPL), one of the leading businesses in the local real estate industry, provides a full range of services to developers, owners, occupiers and investors.
Its CEO and Chairman Cheng Kheng says that the use of technology in the real estate sector is vital.
He adds that technology will help improve agents’ efficiency more than 60 percent.
“It is fast and it is easy to control data,” Cheng adds.
“If we have 1,000 or 10,000 properties listed in our system, it is easily checked via the technology but, without technology, it will make our work slower.
“However, with the technology, we can do it much more quickly.”
New technology is a recent addition to the local real estate market but is much more developed in other countries.
However, in the next three years, it will boom because it it is convenient and customers are gaining trust in it, says Ros Sovantha, CEO of Estate Xchange.
“Now we use a new technology called virtual reality (VR), which provides 360-degree camera views so potential customers do not need to see the actual location in person.
“They can just come to the office where they view a whole range of properties inside and out and from above,” Ros adds.
Kim, however, points out it’s a competitive business.
“Without a system and teamwork, it does not work. It means the big will grab the small and the small will grab even smaller companies,” he adds.
“The competition was tough before. There were fewer companies then.
“Now there are more companies so they have to be big and, without high technology and no capital, some will collapse,” Kim adds.
At present, he says the real estate investors in Cambodia are planning their strategy to take advantage of the advancement of technology while this sector is growing fast.
Brokers band together
Chrek Soknim, president of the Cambodian Valuers and Estate Agents Association, says online property trading is currently limited in Cambodia. However, in the future, it will become more technology-oriented.
No internet law
At present, trading is on what’s called a Multiple listing system (MLS). An MLS is a service used by a group of real estate brokers.
They band together to create listings that allow each of them to see one another’s properties that are for sale.
Chrek points out Cambodia does not have an internet law so it is easier for hackers to hack the system and trades cannot be completed online, unlike in some countries. Until that is sorted, Cambodia’s real estate industry will lag behind other nations.
“We cannot determine the exact year that we can trade property via the technology that is available in Cambodia,” he added.
“Some companies have a website so that they can check the information on it and if anyone is interested in a property, both sellers and potential buyers can go to see it in person,” he added.
Riskier working offline
O’Sullivan adds that typically, globally it is very hard to make this type of business model work.
“There have been a few in China for example that have launched and failed,” O’Sullivan adds.
“In more established markets some models are selling a few houses as investments, but that’s all I can think of right now.”
O’Sullivan went on to say: “I think the challenge is for traditional real estate agencies that are used to working more offline. The risk for these agents is the younger generation will overtake them as more and more property seekers move online unless these businesses start to accept change and hire savvy, tech-focused marketing people and agents. Adoption, in general, is the challenge, but we will get there.
“I think the whole process of buying and selling real estate will move online. However, I’m not sure the actual function of clicking “buy” on a website will ever happen. I still believe once a buyer or renter is serious about a property they will still want to go to visit the property, touch, feel and get a better sense of the area,” he adds.
Agreements will be digital
“Searching for a property, inquiring about a property, booking appointments and viewings are already the norm and possible on realestate.com.kh right now.
“I do think as the market continues to adopt technology that sales and purchase or rental agreements will become digital, as will all property-related payments and fees.”
Change is just a matter of time as it is for all businesses in the modern world.