Buying, selling and renting real estate in Africa are among the continent’s most established industries — and the least disrupted — but innovation is happening, and it’s going beyond the simple listings portal.
Property listings portals are of course important but they’re only the tip of the iceberg when it comes to revolutionizing real estate in Africa. Companies across the continent are beginning to delve deeper.
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One such is company is South Africa’s HouseME, on the face of it a listings platform but in reality a lot more than that.
The platform links landlords and tenants, allowing the former to find screened and vetted tenants who can rent at the best possible price. But to really disrupt the real estate space,
The company’s PlaceME solution manages the whole rental process for landlords and tenants, allowing tenants to place offers for rentals and ensuring a property does not fall vacant or earn too little because of pricing.
“Not only has our platform improved the placement process, but our management of the leases result in a collections rate that is 15 times better than the industry average,” said CEO Ben Shaw.
He said that historically property has remained a traditional, protected industry, with no disruption to tried-and-tested processes, which agencies hold onto as their own “secret sauce”. In the last few years, however, traditional agencies have been increasing their digital footprint and startups are coming to the fore. This helps everyone.
“Our landlords benefit from the lowest rental fee in the industry and our tenants enjoy a one-month deposit – far less than other rental agencies,” said Shaw. “In the last years, HouseME’s property listings increased by 300 percent, which underlines the tremendous value we bring across the country.”
Renting property in Nigeria is fraught with problems, with tenants required to pay for years upfront. T
Fibre.ng was launched in 2016 because its co-founders felt that bringing inventory online was not enough.
“There are so many problems with what happens after. From inaccurate listings to fraudulent agents on the tenant’s side to lack of verification of tenants and oversight on the landlord’s side. Fibre is a direct response to these challenges,” said co-founder Demilade Ademuson.
The platform offers flexible payment plans to tenants, as well as shared housing options, to help ease the financial burden that tenants in major cities like Lagos face.
“Landlords gain because their property is rented out to the best tenants and they largely do not have to be hands-on with the management of their property,” said Ademuson.
“Tenants gain because they are able to pay for most property on our site through payment plans and they can also access a range of shared housing options.”
The company has also taken things a step further with the launch of Secure, which focuses on the purchasing of property, and makes investing in real estate more accessible to more people.
Secure cuts out the red tape associated with purchasing property, by handling taxes, documentation and legal processes on a buyer’s behalf, while it also allows individuals to crowd-invest in properties.
For many millenials, however, buying property is still some way off. Most tech solutions are focused on people who have no choice but to go for rental options, dubbed “generation rent”.
South Africa’s Flow rewards tenants for registering, paying their rent on time, and looking after their homes.
The startup just raised a $1.5 million funding round, and co-founder Gil Sperling says it is building tools that encompass the end-to-end journey of a tenant.
These tools automate and digitize the current archaic process, giving “generation rent” what they expect and are used to from technology, and rewards them for being a great tenant.
“It’s not only about having these tools but about connecting the whole ecosystem including service providers tenants use in their home, which are Flow reward partners. Tenants get a higher Flow Score for paying rent on time, looking after their place and more which give them access to better deals, ultimately making renting more affordable,” Sperling said.
“The ecosystem of neighborhood and national merchants where tenants spend anyway, gain from increased business and high quality transactions from Flow tenants.”
Sperling believes the use of tech in the property sector will only further develop.
“Landlord and property management tools are becoming more sophisticated and scalable, augmented and virtual reality is being explored for experiencing home viewings digitally for tenants, and financial services are innovating around payments for rent and insurance against default and damages,” he said.
For now, progress has been relatively slow, but it is only the beginning.
Tom Jackson is co-founder of Disrupt Africa, a news and research company focused on the African tech startup ecosystem.
