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Where's all the PropTech at?

Israel is known as a leader in many areas of technology, from cyber security to water tech, but it seems to be crawling behind much of the developed world in the most fundamental, and traditional applications of technology – building.

This lag applies across the construction sectors – ask anyone who’s been waiting over a decade for the “fast train” from Jerusalem to Tel Aviv to be completed or who’s parking garage door can only opened by phone, in a garage with no cell service. While big infrastructure projects like the fast train are the ones that grab headlines, its felt most acutely on a daily basis by homeowners – ask anyone whose paid twice as much as expected, and waited twice as long as promised for a new house to be built. This technology lag spills over into the next stage after building, real estate, know as PropTech or REtech. For instance, according SimilarWeb, five of the top 200 visited websites in the US are residential real estate companies while in Israel that number is zero. I can’t even think of any Hillel Fuld interviews or articles where he’s mentioned a residential real estate startup servicing Israel, other than his article on AirBnB, which wasn’t exactly singing its praises.

So what gives? I think a major factor is a concept which has been spoken about before: the fact that Israel is among the best in the world in reacting to emergency situations, whether its existential threats from its neighbors, natural disasters around the world, or life-threatening droughts – but we’re not great at planning for normal, routine life. We can build super advanced missile defense systems to protect us from rockets in just a couple of years, but its taken decades to build a light rail system in Tel Aviv; within hours we can set up a field hospital in the Philippines, but you have to wait months to get an MRI in Israel.

Another issue is scalability. While Israel makes a lot of noise, it is a tiny country. For that reason, most Israeli tech is designed for use abroad, not internally. Several Israeli entrepreneurs I have spoken with in the PropTech scene have ideas and capabilities to make the home purchasing and renting processes much more efficient here, but their sights are set on New York and London, not Jerusalem and Haifa. Israel only has a population of about 8.5 million. If you consider the relatively high percentage of children, and exclude groups who are less reliant on technology, like Haredim and Beduins, Israel’s entire PropTech market is similar to the size of Miami’s.

Largely for these two reasons, the standards of quality and customer service in the Israeli housing industry is embarrassingly low. If no one cares about the Israeli consumer’s long-term needs, why would they design technology to help them? This is a question that I have thought a lot about. The company which I’ve been helping to build over the last year, Trusted House, is not a tech start up – we manage customer journeys in the field of residential real estate. Our goal isn’t to create some big app or software and make a big exit. Our goal is to provide our customers with quality housing through processes that allow them to enjoy peace of mind throughout their real estate experience. Sometimes that involves integrating technology into the process, like using Salesforce to keep track of ongoing maintenance in a property, or Tarya to finance a renovation project. Other times it just means integrating excellent professionals, like trustworthy lawyers and mortgage brokers to make a transaction more successful.

Thank God, and thanks to a lot of hard work by Oded Stern and the other partners we’ve had along the way, Trusted House has reached the point where we need to start creating our own technologies to make these processes more efficient and organized for our growing flow of clients. We invite you to follow along on this fun/stressful/exciting journey towards fixing the real estate industry in Israel!

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