As we adjust to a life post-Covid-19, letting agents, landlords, and tenants are thinking - ways to speed up the process from first viewing to a signed tenancy contract.
In this new normal, real estate technology-based start-ups which can ‘pre-qualify tenants’ in minutes without costing the letting agent an arm and a leg will thrive.
The number of people renting continues to increase with a third of UK’s millennials who will rent into retirement. The UK also has the fifth-highest number of tenant occupiers out of all 28 EU nations.
Letting compliance firm VeriSmart forecasts renters will account for 55% of the housing market by 2045.
The needs of those living in a rented property have changed dramatically. For example, nearly 100% of the Generation Z renters own a smartphone and spend over four hours per day online.
In this new world, forward-looking letting agents have an opportunity to embrace technology to better serve the needs of tenants, build a lasting relationship which starts when a tenant rent their first property and all the way towards home ownership.
Covid-19 will force everybody to accelerate digital adoption - from pre-qualifying tenants in minutes through Open Banking, to virtual viewings, electronic tenancy contracts, and e-wallets for digital payments to enable real-time rental payments to landlords and letting agents.
This rapid acceleration of digitisation creates an opportunity for high-street letting agents to partner with PropTech firms, generate higher value, and focus on doing what they do best - letting properties faster and nurturing relationships with landlords and tenants.
Emerging technologies and Open Banking-based innovation can significantly reduce the time it takes a letting agent to let a property. Where time is money, letting agents and tenants alike can find out in 5-10 minutes, a tenant’s credit, and financial worthiness.
In this new future, a Rental Passport, (akin to LinkedIn for renters) allows tenants to build their portable digital rental and financial profile on their mobile devices. From a GDPR standpoint, tenants also have complete control over their personal rental and financial data.
Canopy’s RentPassport is a portable digital rental and financial profile of a renter available across multiple channels - iOS, Android, web app, and desktop.
Canopy’s renter screening tool produces a comprehensive report including an Experian-based credit score, CCJs, KYC, AML, and Open Banking-based verification for free. For employment and previous landlord references, Canopy charges a one-time £3 to the housing providers.
Canopy aims to eliminate tenant screening costs for the letting agents by December 2021.
As we come out of the Covid-19 crisis, reducing OPEX and growing top-line revenue is top-of-mind for the leadership teams in the lettings industry.
For instance, a Letting Agent processing 50,000 annual reference checks could save over £350,000 with Canopy annually and just under a £2 million from 2020 to 2025. That is significant cash saving and could help address some of the revenue lost over Q2 2020.
The property market’s response to our rental solutions has been incredibly positive with some of the largest agents and Build to Rent operators in the UK already joining Canopy’s trust-based rental community.
Agents have remarked at how void periods have fallen, with some properties becoming more affordable by thousands of pounds.
Renting is an ever-growing part of UK life and infrastructure needs to be established in order to support all of the parties involved. It is therefore more important than ever for tech disruptors to emerge and revolutionise the archaic systems we currently navigate within the market.
*Tahir Farooqui is Founder and CEO of Canopy