Breaking Property News – 04/01/24
Daily bite-sized proptech and property news in partnership with Proptech-X.
Will Green Investment be in the red if Labour sweep to power?
Only four days into 2024, and the potential new Prime minister Sir Keir Starmer seems to be scaling back expectations regarding the whole green agenda which until recently was a big part of what a Labour Government would be delivering.
As reported in The Times today by Matt Dathan, Home Affairs Editor, ‘Labour’s plan to borrow up to £28 billion a year for green investment could be scaled back further, Sir Keir Starmer has said. The Labour leader said the pledge will depend on economic conditions when the party is in power. He said the policy to spend £28 billion a year on technology and jobs would come from borrowing and conceded that if the finances were insufficient the party will “borrow less”.
Asked whether the money would be raised by taxes or borrowing, Starmer: “We have set out how that will be funded, the money that is needed for the investment, which is undoubtedly needed … that the £28 billion will be ramped up in the second half of the parliament, that it will be subject of course to any money that the government is already putting in.’
Trying to tease out the messaging from the rhetoric is difficult, is Labour for the acceleration of green technologies and all that flows from it, the Environmental, Social and Governance (ESG) agenda or is it more around new jobs being created, a rallying cry for workers.
From my standpoint, though there is a legion of new green technology operations being set up, it is far from a mature landscape with precious little profitable case studies to choose from. With much of the soundbites about saving the environment, the need for carbon neutral for example across commercial real estate is often about collecting data about how ‘badly’ we conserve, rather than finding the big answers to improve things.
2023 saw the lowest amount of investment pouring into most sectors of technology, yes anything with Generative AI attached to it might have been getting funding, but the notion that pumping billions of pounds into this relatively new vertical is I feel a little premature.
On a secondary level also, is it a vote winner or loser? Or is it very low down on the list of pain points for the undecided electorate. We know that Rishi Sunak the incumbent Prime Minister wanted to align himself with being at the forefront of technology, hence the Bletchley Park AI conference and the Elon Musk discussion. But for a man who can not back up his WhatsApp this just shows the yawning chasm between looking for photo opportunities Vs a solid grasp of what technology can really do.
In a way if the government coffers are depleted is this going to stall the development of Green technologies whoever is sitting inside number 10. For my money no, because it is usually private enterprise, funded by VC and other private cash that drives commercially viable solutions.
In the next decade it will be large technology companies themselves finding the solutions, rather than governments. Utilising science and technology to protect the world’s natural resources and minimise the negative environmental impact of our human activity. Which is a double edged sword as if the tax payer pays for the solution rather than a private enterprise the end user cost is likely to be far higher.
One in three residential property sales cancels – can technology fix this problem?
For some time a large number of property technology companies in the UK and globally have been trying to build the definitive service that prevents the 28% to 31% of property sales from falling through each year. For the enterprise who hits upon the answer a huge financial reward beckons. But despite many millions having been put into development as yet there seems to be no end to the problem.
At present we have companies focusing on ‘upfront information’ the hope being that early clarity regarding all the usual problems that usually become teased out as a property is conveyanced, will staunch buyer’s remorse and keep more transactions in play. Others focus on the need to apply for local authority searches and instructing conveyancers and solicitors to move forward at an earlier stage.
Sticking points in the transfer of title from one party to the other revolve around the need for many stakeholders to interact and communicate, the agent, solicitor, broker, surveyor, lender etc all go about their specific work each time a sale is agreed, and many companies are now focusing on how the communication between all parties can be speeded up using modern technology.
In the past seven-years I have engaged and discussed with and looked at over a hundred different property technology businesses who have been grasping with the complexities of the usual 216 stages that a typical UK sale goes through. Some of them monitor the state of play, others hurry along certain aspects. In my head as we are now in 2024 and there has been a huge explosion around the wonders of Generative AI, as though it is the cure for everything (we shall see), but I do think that it is opening stakeholders eyes to the fact that useful data and digital technology will be the way this thorny and nebulous problem is solved.
With a cumulative housing market fee pot of around £8BN a year, the company that could reduce fall throughs by 10% as a repeatable and proven Saas model, would be able to command a huge amount of ARR, giving them a market capatalisation that touches the sky. Better still there with fewer aborted sales and more people would be able to move each year, with a far greater sense of certainty on the day they list their most expensive asset.
Andrew Stanton Executive Editor – moving property and proptech forward. PropTech-X
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