The real estate industry is now entering a period of major transformation. In an industry where analog methods and multi-layered transaction structures have long been the norm, advances in technology are opening up new possibilities. However, technology alone cannot solve everything. The power of "talent" is the true source of competitive advantage and sustainable growth for any company. In this column, we explore how the fusion of technology and human capability is bringing innovation to the real estate industry, and consider its outlook and potential.
What Are the Structural Challenges Facing the Real Estate Industry?
The real estate industry faces two major structural challenges: opacity in evaluation due to multi-layered general contractor and subcontractor structures, and information asymmetry. These conditions create a situation where people who work hard on the front lines are not fairly rewarded.
Particularly in the construction and property management industries, multi-layered structures make it difficult to see and recognize the contributions of those working hard on the ground. There is a reality where people with technical skills and track records are unable to receive appropriate compensation or recognition due to opaque transaction structures. The rental management sector in particular is one of the areas within the real estate industry where information asymmetry is most severe.
Faced with these challenges, the strong desire to "create a society where hardworking people are properly rewarded" became the founding principle of INA&Associates Co., Ltd. (hereinafter "INA").
How Is PropTech Changing the Real Estate Industry?
PropTech (Property Technology) is the collective term for initiatives that leverage the latest technologies such as AI, IoT, and big data to solve challenges and improve operational efficiency in the real estate industry. It aims to enhance the efficiency and transparency of the industry as a whole.
The real estate industry has long operated through traditional methods, but the evolution of technology is beginning to have a significant impact on this sector as well. PropTech aims to streamline various processes and transactions, improve transparency, and enhance the customer experience. As seen in the future of building maintenance leveraging AI and IoT, the scope of technology application is expanding rapidly.
At INA, we seek to increase transparency in the opaque, multi-layered industry structure through clear referral fee frameworks and the visualization of business processes. We aim to establish a system where technical skills and expertise are fairly evaluated by eliminating unclear fee structures between general contractors and subcontractors and creating a fair and transparent transaction environment.
Why Is the Value of "Talent" Even More Important Than Technology?
No matter how advanced technology becomes, it is ultimately human ingenuity and passion that utilize it to create value. At INA, we position "talent" as an irreplaceable asset for the company and make investment in their growth our top priority.
At INA, we consciously use the word "talent" (人財) rather than simply "human resources" (人材), because we view people not merely as labor but as an irreplaceable asset to the company. Based on the belief that talent is the foundation of corporate value, we believe that each and every employee continuing to challenge themselves without fear of failure, and continuing to grow, is what creates and enhances corporate value.
No matter how advanced technology and capital become, in the end it is the ingenuity and passion of the people who utilize them that determines outcomes. The power generated by outstanding talent in day-to-day operations is immeasurable, and we are convinced that without talent, there can be no corporate development.
What Kind of Value Emerges from the Fusion of Technology and Human Capability?
True innovation in the real estate industry emerges from the fusion of efficiency gains through technology and judgments based on human sensibility and experience. Particularly in the important life decisions of choosing a home or workplace, values and feelings that cannot be quantified play a significant role.
Technology alone cannot fully replace judgments based on human sensibility and experience. The "fusion of technology and human capability" is the key to opening up the future of the real estate industry.
Where Is the Real Estate Industry Headed?
As PropTech advances and the industry becomes more efficient, the "depth" of matching will become an important challenge going forward. The key to solving this challenge lies in fusing the power of technology with human warmth and attentive service.
Going forward, the emergence of AI will further evolve the matching process. However, many real estate sales representatives have no opportunity to follow up after a transaction is completed, and there is no occasion to reflect on whether that transaction was truly a good choice. It will be necessary to use technology to streamline what can be streamlined, and to concentrate on delivering value that only humans can provide, in order to achieve deeper matching.
The emergence of online brokerage platforms has made property searches and transactions easier, and AI-powered automated valuation systems have accelerated the calculation of real estate values. Furthermore, advances in VR/AR technology have made it possible to tour properties remotely. However, it is the power of "talent" who master these technologies that makes them truly valuable.
At INA, we will continue to cherish the spirit of our founding while working to create new value through the fusion of technology and human capability. In the real estate industry—where digitalization is most difficult and most necessary—innovation that combines purpose-driven management with the power of human capital will be the key to opening up the future.
Frequently Asked Questions (FAQ)
Q. What is PropTech?
PropTech (Property Technology) is the collective term for initiatives that leverage the latest technologies such as AI, IoT, and big data to solve challenges and improve operational efficiency in the real estate industry. Representative examples include online property searches, AI appraisals, and VR property tours.
Q. Why is the digitalization of the real estate industry lagging behind?
The real estate industry has long been built on analog methods and multi-layered transaction structures, so transforming business processes takes time. Additionally, the high transaction value per deal and the emphasis placed on human judgment and trust relationships also serve as barriers to digitalization.
Q. Will real estate sales professionals become unnecessary as technology advances?
No, they will not. While technology is effective for streamlining tasks such as property searches and price appraisals, for major life decisions like choosing a home, advice based on feelings and experience that cannot be quantified is indispensable. The fusion of technology and human capability is what creates true value.
Q. What does INA mean by transparency in the real estate industry?
INA aims to establish a fair transaction environment where technical skills and expertise are properly evaluated, by eliminating unclear fee structures between general contractors and subcontractors and achieving transparency through clear referral fee frameworks and the visualization of business processes.
