7 OCT. 2019
To become more competitive and ensure transparency of data for clients, the European PropTech sector needs to adopt common standards that will allow speaking the same language, according to RICS leaders discussing the “Innovation and regulation in the age of PropTech” at Expo Real, the international trade fair for property and investment, held in Munich.
We believe the digitisation wave currently sweeping the property sector can only be exploited to the full if data and processes are standardised and good corporate governance strategies are in place to protect the public interest.
Across Europe, more and more mainstream companies are changing their strategies and looking for new and diverse talent, with new technical skills and specialisms to become more efficient, sustainable and innovative. The European PropTech sector is currently booming, with a rich and promising ecosystem of approximately 2,900 start-up companies across the whole region and 15 PropTech networks. However, the sector has some important challenges ahead.
Compared to the US and China, there are important gaps in terms of competitiveness in Europe, mainly due to market fragmentation, as well as to the difficulty of getting funding, in particular, investment for later stage and more established companies.
Another challenge for the industry is that much of the existing data on real estate (from land, planning, construction, sales, leasing, letting, occupation, maintenance to end of life), is still held in fundamentally paper form, albeit available in pdf format or as scans of original documents. Where data are held in more formal, structured databases or as Excel spreadsheets, a lack of common data standards and data models still makes sharing data within organisations and across the broader marketplace problematic.
This is a problem because data as we understand it today can only really reach its true potential if it is shared, facilitating collaboration and fluid decision making to best serve the needs of clients.
That’s why in order to address this challenge around inconsistent, unstructured data that the industry is facing, RICS has developed a suite of data standards – open data models – that support the capture, verification and sharing of data to a common format.
RICS Data Standards are already available for construction costs - International Construction Measurement Standards (ICMS) - and property measurement - International Property Measurement Standards (IPMS). These will soon be joined by data standards for the International Land Measurement Standard (ILMS) – a due diligence framework for land and real property surveying, and for the International Valuation Standard (IVS) – known to many as the 'Red Book'.
Another important challenge for the PropTech sector is that the risks of sensitive, personal or client information being mishandled are significant and can have serious consequences.
For RICS professionals and firms, the challenge when handling client data lies in providing assurances that it is being properly managed. Criminals are becoming more inventive, and increased scrutiny under the General Data Protection Regulation means security breaches can have devastating effects on a company. Consequently, clients are seeking reassurances on security from the outset.
To minimise the risk of falling victim to a cyber attack and to help protect professionals from disciplinary and legal consequences is a key RICS priority. To this end, we are consulting worldwide on a new ‘Data Handling and Prevention of Cybercrime’ professional statement which establishes best practice. The consultation is open to industry professionals until end of October 2019.
RICS Global Director of Standards
RICS is working on a new professional standard on data handling & cybercrime for the real estate sector.
Once the final professional statement is published, all RICS professionals and regulated firms will be obliged to adhere to it.