SINGAPORE — One of the big trends in human development is the digitisation of our physical world. It is happening all around us: We are digitising social interaction. WhatsApp, Facebook, WeChat, Instagram, Snapchat and Twitter are just some of the many apps we now use to communicate with each other. On the retail front, we buy physical goods but only after reviewing their digital versions on Qoo10, RedMart, Carousell, Lazada and traditional global sites such as Amazon.

The digitisation of the financial world is moving at light speed. Traditional stock exchanges adopted electronic trading a long time ago but are under continued pressure from 
alternative ways of trading, including crossing networks and dark pools. Meanwhile, bitcoin is challenging our fundamental understanding of money. This and other competitive pressures are forcing traditional financial institutions to experiment with digital wallets, mobile banking, artificial intelligence and so much more.

The property market, particularly in Singapore, has been a laggard in digitising itself. But this is changing and it should be able to catch up and even surpass other markets. The starting point for digitising property has been the opening up of Big Data by the government and private sources for the benefit of all market participants, including consumers, real estate professionals, policy makers and urban planners.

Now it is possible to represent the physical home in the digital space with digitised photographs, floor plans, specifications (i.e. plot ratio, land area, floor area), 360-degree videos, and drone overheads.

This improves the ability of urban planners to develop residential and commercial neighbourhoods. More importantly, digitisation makes real estate transactions more efficient. A digital representation provides truth-in-advertising and helps buyers, valuers, mortgage and insurance underwriters make well-informed decisions.

Another big development in property is computer pricing and automated valuations. The property market has lagged retail and financial markets in transparent pricing. As a result, a few well-connected insiders, such as valuers, financiers, brokers and developers, controlled property pricing.

Not any more. Buyers, sellers and their agents and advisers are now in control. By using neutral computer algorithms such as SRX Property’s X-Value, these market participants justify and document deviations from the computer-generated values to agree on the right price.

This type of transparent pricing has many benefits, such as reducing a property’s days-on-the-market (DOM). A quality property listing in Singapore, which contains a computer-backed full valuation and a digital representation of the home, reduces the average market DOM by at least half. This simple act of digitising a property makes a huge difference in creating a more efficient market.

Digitising pricing also reduces risk, helping mortgage and insurance professionals better assess the market value of a property and therefore better underwrite the underlying mortgage and insurance for the property. This in turn reduces the risk of housing bubbles, defaults and fraud, strengthening the stability of Singapore’s financial system.

As we look to the future of real estate, there are several Smart Nation initiatives that will digitise the paperwork involved in property transactions. This will make financing and conveyancing a more efficient and pleasant experience for consumers and employees of financial institutions in Singapore as it becomes a Smart Property Nation.

ABOUT THE AUTHOR: Sam Baker is co-founder and chief executive of SRX Property.