8.5 million people, or about 60% of Korea’s total households currently live in apartments, and this sets the base market for innovation in real estate tech in Korea.
The historic country of Korea in East Asia has a population of over 76.5 million and is divided into district sovereign states: North Korea and South Korea. History is a witness that Korea has always been technologically advanced, being the one that created the In 1234 the first books known to have been printed in metallic type set . Over the next centuries, with an increase in population and many invasions later, Korea is still the leader in technology space and competes with most global standards for innovation and advancement.
Though we intend to provide a holistic view of real estate tech in Korea, a majority of information shared here will refer to South Korea as the North Korean real estate market is heavily controlled by the Supreme Leader and innovation is hard to track and report.
Seoul is the largest and capital city of South Korea and is considered a megacity as it houses a population of more than 10 million. There was rapid industrialization in Seoul post the damage done by the Korean war and the first thing one notices about Seoul today is its modernity and technological advancement, characterized as a glass, steel and concrete jungle. Other parts of South Korea are also technologically advanced but haven’t caught up to the pace of Seoul. South Korea is a highly smartphone savvy country and one will be able to observe many smartphones/smart devices here with high internet availability. This real estate setting as well as tech adoption gives us enough history to further understand the current scenario of real estate tech in Korea and how #PropTech is thriving here.
South Korea is also the place which will be home to Songdo International Business District (Songdo IBD), one of the world’s first specially designed smart cities. Built from scratch on reclaimed land, the city was developed with technological infrastructure that supports connected Internet services within its basic structure of public transport and housing. If this isn’t a true example of advancement in real estate tech in Korea then what is!
The Korean Tech startups ecosystem
To fully understand the scope of real estate tech in Korea or Proptech, it will be interesting to see the technology trends in Korea and get a look into South Korea’s thriving startup ecosystem.
A report by Korean Startup Ecosystem Forum (KSEF) in 2016 showcased that the Korean entrepreneurship community is mostly focussed on the pillars of ICT (Information, Communications Technology). These are mostly high technology sectors which include domains like 3D printing, IoT (Internet of Things), mobile internet, cloud computing, intelligent services automation and even robotics. This goes a long way in showcasing the interest areas of the average Korean entrepreneurs and sets base for the technological innovations in the coming times, even in real estate tech in Korea. It is also interesting to see that the report also noted that the most funded sectors, for each financing stage in Korea, are food for Seed/Angel round and real estate tech for a Pre-series A round. It showcased that more than 15.3 million were invested in pre-series A round stage for real estate tech startups in Korea, in 2016.
An average Korean entrepreneur can be seen as a male in their mid 30’s with mostly an engineering background. And no, this is not a stereotype we are promoting. The KSEF report also mentioned that the majority of Korean entrepreneurs are males in this age group with an engineering degree. It also noted that 42% of all Korean entrepreneurs have established another startup before finding the current one, and 95% of them now prefer joint-foundership.
Currently, Korea is looking to build for increased diversity through global expansion, and that includes investment towards women and international members. This will help maintain, or even speed up, the current momentum of positive growth in the Korean entrepreneurship ecosystem. This brings to talk about the real estate in Korea to better understand what calls for real estate tech in Korea or what fuels this proptech revolution.
Real Estate in Korea
The real estate market of Korea is currently rapidly changing, owing to internalization of real estate markets, amongst other factors. It is also a growing sentiment that real estate is a major source of national wealth and health investment assets other than just a target of regulation. This government intervention also means that there is a convergence of real estate markets and capital markets. The functioning of the real estate market is being continuously improved with increased availability of quality real estate information and systematic analysis-based real estate developments and investments. Keeping up with the times, many universities in Korea are now also offering courses in real estate science and management.
8.5 million people, or about 60% of Korea’s total households currently live in apartments, and this sets the base market for innovation in real estate tech in Korea. The proptech market uses this trend and we shall discuss a variety of products that cater to this exact market segment.
Story of real estate tech in Korea
With the popularity of smartphones, and the convenience that comes with it, mobile apps for real estate are loved by consumers and investors both, across Asia. South Korea is no different. Some experts suggest that the size of the real estate information industry is more than USD 880 million in Korea and mobile apps enjoy 10% of this total market share.
Providing convenience and an intuitive user experience, apartment hunting apps are highly popular in Korea, and some of them have received upwards of USD 18 million in funding from interested investors. The largest share of mobile realtors app is enjoyed by ZigBang, which claims to make up 80% of the country’s real estate app market, setting precedents for real estate tech in Korea. The other providers in this market are Naver and Kakao. Via these apps, users can make the apartment hunting and selection process easier using filtered search by rooms and area, map search and even real estate services, changing the proptech scenario of here.
Another interesting startup working in the real estate tech of Korea sector is Disco, which is a service that provides detailed real estate information and transaction data. It aims to solve the information asymmetry problem of the market in Korea.
If we are talking about tools for real estate then a striking startup in Korea is UrbanBase, which is in the works of virtual reality tools for interior planning and design. It claims that it’s patented algorithm turns 2D floor plans into virtual spaces in as little as two minutes.
Korea is also home to an award winning startup- Yanolja, which calls itself a one stop solution for human resource, real estate, equipments and beddings. It is a offline to online startup that won the IoT innovation award for 2017.
These startups and many others are doing revolutionary work in real estate tech in Korea and defining the proptech space of here.
The future of real estate tech in Korea
With rise in innovation and technological development, real estate tech in Korea or proptech is only set to rise. Being home to a smart city as well as a megacity, provides South Korea with enough market as well as testing bed for these new technologies, which can later be replicated for global markets. Real estate tech in Korea is flourishing and the proptech sector is only going to gain exponential growth in the coming years.
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