Valuers and investors: how is data and technology affecting you?

Dan Hughes

Director, Data and Information Product Management (RICS)

Data and technology is changing the way professionals carry out their roles and is impacting on the sector at large. This includes implications for valuers and investors, changing the way that property valuations are carried out and informing business decisions on property investment.

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As data becomes more readily available, what do we need to do to ensure the quality and efficient sharing of data?

Together with the European Association for Investors in Non-Listed Real Estate (INREV), we are carrying out a piece of research to provide insight into data and data standards for investors.

  • Is the data, quality and cost of data important for informing decision making?
  • Is the role of data and technology going to increase in future?
  • Are market wide data standards required to ensure the quality of data?

We'd love to hear your views on some of these questions. Earn 30 minutes informal CPD for carrying out the short survey.

Comments (3)

  1. This is such an important issue, way beyond any 'Prop Tech' hype. This is where the industry is severely behind the curve compared with other asset classes and professional regulatory bodies.

    Cameron Most Cameron Most, 1 June at 16:05PM

  2. For investors understanding the nuances of data modelling and algorithms will seem to be a foreign language, but the implications are starting to become clear. Implicit Bias in data analysis is just one such fact that consumers of data analytics need to be cognisant of. Whilst we have become accustomed to checking our sources when referencing research it is now becoming important to consider looking into how the algorithms and rules that drive analytics have been crafted. Algorithms and the analytics they drive are delivering distorted output that pulls through distortion unconsciously from the belief and preconceptions, limitations of their creators (or developers). Just because it comes out of a smart computer interface in the form of a professional looking report can be hypnotising.

    A more simple challenge is the management of data, in consistent and reliable ways, that ensures the raw a material (the data) itself is reliable. Unfortunately poor data custodial management can very quickly result in contaminated and inconsistent data sets. Garbage in Garbage out.

     IDC reports  that  enterprise  data  stores  will  grow  an  average  of  60  percent  annually. http://c.ymcdn.com/sites/www.theasbc.org/resource/dynamic/blogs/How_Fast_is_Our_Data_Growing.pdf

    How long is it going to be before RICS members, as Valuers, will be expanding their skill set into Data Valuation? It is an intangible that many of the research groups in the alphabet soup of the consulting world are working hard at crystallising. When that happens, investors will at last have optics on the value of data in an organisation.

    This means the implications of Data in its various classes is going to grow in its impact as well as empower in many tangible, intangible, predictable and unexpected ways. The first decision for all practices is to decide to manage data in moral and ethical ways. This demands a new awareness that starts with basic Cyber Hygiene to ensure data is held in accordance with best practices and in the best interests of the Data Subjects and other entities that the Data may relate to or could impact. How many practices exercise disciplined data lifecycle management and security?

    The Question is perhaps how many practices actually know what data they hold, its value and the obligations retention of that data places on them and the risk impact of digital threats to that data?

    Data is a bit like radioactive material, it's incredibly powerful harnessed in appropriately controlled environments but becomes toxic and with exponential collateral fallout if handled carelessly or disposed of in a responsible way.
    Data standards have been poorly adopted as have the appropriate management practices that should go alongside them. As a result the regulators have had to step in and business is now having to adhere to regulation in the absence of businesses exercising best practices and demonstrating self-regulation. The EU GDPR (General Data Protection Regulations) is one such that comes into force in May 2018 building on the former poorly adhered to Data Protection Act. GDPR will impact every firm of surveyors, as I suspect few do not have many hundreds of contact records going back years and I suspect be the seismic event that will launch many practices into digital transformative motions.

    The impact of data regulations and the associated technologies that practices will have to adopt to manage data and to be able to demonstrate best custodial practices efficiently will have a much wider impact. As practices get to grips with their data management, the systems they will have to adopt will introduce new associated features and processes that will open minds to new ways of working. This will drive change, something we as humans are often very reluctant to embrace and in addressing that trait is just the start of the challenge.

    Nigel Gibbons Nigel Gibbons, 10 June at 10:57AM

  3. I agree with Cameron Most's comment that Commercial Real Estate is way behind the curve. So much of the hyped PropTech or CRETech is in reality no more than putting rubber tires on a horse and cart.

    For example, the 'disruptive' valuation software start-ups (10 at my last count) are touting as 'fundamentally changing the way real estate is transacted'. Other than delivering these pre-programmed spreadsheets via the cloud there is nothing new or that did not exist with Lotus 123 let alone Excel - they are standard DCF models and as such offer no new insight nor make use of advanced simulation computing and the reams of market data that could be used to measure volatility and risk.

    There needs to be a shake out of over-hyped and opportunistic start-ups who are raising funds with little hope of delivering the much needed transformation CRE needs to improve liquidity and move from an alternative to mainstream investment asset class.

    S Yeldar S Yeldar, 22 hours ago

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