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Proptech Investor Confidence Scales New Peak After Reaching Four-Year Low
Six months after reaching a four-year low, the Global Proptech Investor Confidence Index is at an all-time high. MetaProp says the index posted a score of 9.2, surpassing the previous peak of 8.8 that was set in the very different time of midyear 2019.
“To a degree that may have been difficult to imagine only a few short months ago, the COVID-19 crisis has accelerated the adoption of technology and, in tandem, investor interest has risen tremendously,” MetaProp co-founder Aaron Block writes in an introduction to MetaProp’s report.
This net acceleration in technology adoption is coupled with “the momentous performance of proptech companies in the public markets in the second half of the year,” according to MetaProp. The report cites the successful SPAC deals for Porch and Opendoor, as well as the debut of a dozen new PropTech-focused SPACs.
The flurry of public-market activity is complemented by private transactions, including the acquisitions of Realpage by ThomaBravo and Homesnap by CoStar. “It is clear that both public and private markets are recognizing the promise of the proptech sector and that we have entered a new phase in the proptech market’s growth and maturity,” according to MetaProp.
Further, 94% of investors surveyed by MetaProp believe that COVID-19 will further accelerate the adoption of proptech in the real estate industry, up 5% from the already optimistic sentiment reported in the Mid-Year 2020 Index.
At the other end of the proptech life cycle from the established companies, MetaProp’s current Startup Confidence Index is 7.7 out of 10, the highest recorded level to date.
“COVID-19 produced a dramatic drop of 2.5 points for the first half of 2020, but startup confidence in the sector has been restored with gains,” the report states. “The virus also accelerated the adoption of technology in real estate, creating new opportunities for existing proptech companies, as well as an environment of innovation and growth.”
Thirty-nine percent of startups say it will be easier to obtain venture capital funding over the next 12 months compared to the previous 12 months. That’s “a dramatic increase” from an all-time low of 12% during the middle of 2020, MetaProp reports.
