PropTech: Exploring the prerequisites to advance the digital innovation of real estate listings
ABSTRACT
With an increasing population and decreasing housing supply, students in large cities get entangled in a societal crisis. Concurrently, the intermediary rental websites are scattered and insufficient. An emerging technology;
PropTech is in the nascent phase, aiming to streamline the rental process by assisting target users. Through an exploratory approach, this study thoroughly investigated the sequences which prospective tenants encounter during the rental process. Simultaneously, their challenges and needs got examined. The data collection consisted of a landscape analysis, and semi-structured interviews combined with a focus group. The identified sequences which need to be incorporated into a rental PropTech platform are (1) Finding the listings, (2) Filtering the listings, (3) Contact with landlord, (4) Viewing the property, (5) Closing a deal, (6) Moving in, and (7) Post moving feedback. Throughout such a platform, it is essential to implement functions that support transparency, reliability, privacy, and feedback.
Author Keywords
PropTech; Sharing economy; Digital product development;
User research; User-centered design; Real Estate;
CSS Concepts
• Human-centered computing~Human computer interaction (HCI)~HCI design and evaluation methods;
User studies; Empirical studies in HCI;
INTRODUCTION
The population growth in urban areas, such as Uppsala and Stockholm, has caused several housing problems. Low supply of long-term rentals in comparison to high demand by prospective tenants has increased the rental prices and limited the housing options [32]. Statistics covering years 2008-2018 indicate a constant population growth between the ages 15-34, both in Uppsala and Stockholm [40].
Simultaneously, forecasts indicate the population will grow
even more [41,42]. This development primarily affects young people and students, whose economy is weak compared to other demographic groups [8].
Besides the housing shortage and growing population which is a societal problem, the housing phenomenon in large cities such as Uppsala and Stockholm is also problematic from a technological point of view. The rental sector in Sweden has been passive concerning digital innovation. For instance, the search for housing tends to be manual as the options are scattered. The process frequently includes registering on rental waiting-queues, joining Facebook groups focused on housing announcements, and browsing through advertisements on classified websites, such as blocket.se [43].
Apart from the economic unaffordability to find rental space in supply-constrained areas, prospective tenants also experience frustration due to the poor technical search solutions [11]. The current procedure of finding long-term rentals is time-consuming, inefficient, and unsafe as there is a risk of fraud [9,28]. Furthermore, advertisement on classified websites usually lack sufficient pictures, show passive listings, has a limited description of the area and the requested features of tenants [36].
Property technology, abbreviated to PropTech, attempts to address the aforementioned problems and digitalize the main components of real estate management. PropTech encompasses the design, construction, operations, financing, sales, and rentals of commercial and residential properties [44]. Some platforms aim to facilitate the process of finding and renting apartments and rooms. These platforms incorporate the sequences of exploration, transaction, and service [3]. Each sequence can get enhanced through technical functions, such as 360° virtual walkthroughs, geospatial data, secure payments, and verification of tenants and landlords [8]. As PropTech emerges in the fragmented rental sector of Sweden, there is limited research about the end-users; prospective tenants, and their perspective. Hence, this study aims to explore the target users problems and needs, in order to propose the prerequisites for streamlining the rental process through a PropTech platform.
This study entailed three objectives. The first objective was to understand the challenges prospective tenants experience
Christina Betzeki Uppsala University Uppsala, Sweden
christina.betzeki.5890@student.uu.se
This work was submitted in partial fulfilment for the master of science degree in Human-Computer Interaction at Uppsala University, Sweden. Permission to make digital or hard copies of all or part of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. Copyrights for components of this work owned by others than the author(s) must be honoured.
© June 15, 2020 Copyright is held by the author(s).
in search of rental housing. The second objective was to assess which functions and data is usable on a PropTech platform. The last objective was to contribute with recommendations to advance the rental process through PropTech. Accordingly, the following set of research questions developed:
How can PropTech streamline the process of finding long- term rentals?
- What problems do prospective tenants encounter in search of long-term rentals?
- What technical functions and location-related information is essential in future platforms?
DELIMITATIONS
PropTech has several sub-categories: smart homes, property management, real estate brokerage, and search of rental listings [4]. This study narrowed its focus to the latter, as PropTech focused on rentals is a novice research field with scarcely any platforms available on the market.
Furthermore, there are two main user groups in PropTech platforms supporting the rental process. These are the tenants searching for housing and the landlord who upload the advertisement and screen the applicants. The study focuses on the tenants, specifically on students, as previous research and current news suggest that it is the most vulnerable group affected by the housing shortage. The term landlord encompasses many meanings such as property owner, agencies, lessor, or roommate. In this study, the term is frequently used and its meaning is delimited to the individual which is responsible for uploading a listing.
Furthermore, this study is not aiming to propose visual elements of the interface.
BACKGROUND
The consequent section addresses previous research related to components of PropTech. Initially, sharing economy is presented as PropTech emerged in that environment.
Furthermore, the users within the sharing economy get highlighted; both their motivational features and their demographic background. The primary user group of residential rental PropTech, are millennials referred to as
"Generation Rent" in literature [14]. Throughout the background, societal implications get discussed. The previous research provided a foundational understanding of PropTech and the current status and limitations.
Sharing Economy
The term Sharing Economy refers to the trade of goods and services in online platforms, enabled by peer-to-peer networks. The users in these socio-economic ecosystems are individuals that can provide and acquire tangible or intangible products [12,24]. Intermediary companies are facilitating the connection and transactions within the sharing economy, usually for a fee. Airbnb is a prominent intermediary example, with a focus on short-term accommodation sharing. Other examples are Uber and Lyft within the spectrum of ride-sharing [6]. Three foundations constitute the sharing economy; access, platform, and community. PropTech innovations assisting the rental
process, can illustrate this concept. Individuals having unoccupied rooms or apartments can give other individuals access to these spaces for a set price. PropTech platforms give access and mediate the transactions [1]. The access occurs through the communication between the tenant and the landlord. This communication is dependent on ratings and feedback within the community of the platform [17].
From a societal aspect, the advantages of the sharing economy is that unexploited assets get used and optimized.
Thus, the sharing economy can be recognized as an approach to counteract population growth in urban areas, climate change, and economic gaps [2,24].
User Background
Research has also shown several factors that motivate individuals to participate in resource exchange within the sharing economy. The most prominent motivational factor is social-hedonic, which refers to the pleasure of meeting and interacting with people. Other factors are related to moral and monetary considerations. The idea that it feels ethically correct to share resources with other people compromise the moral factor. The monetary motive refers to the intent to generate or save money [5]. In literature, Airbnb gets presented as a representative of the sharing economy. Simultaneously, Airbnb is also an example in the context of PropTech supporting short-term accommodation rentals. A recent study found that demographic features differ among tenants renting rooms or entire homes.
Individuals who rent rooms tend to be men, open for social interaction, and with low income. Those who rent the whole accommodation have a higher income and feel uncomfortable with social interaction. However, gender was not as significant for the latter demographic group [22]. In comparison to short-term tenants, there is still considerable ambiguity about the demographic features of long-term tenants.
Generation Rent
An increasing number of studies have found that the societal housing problem has created a generation of young individuals of whom the majority have to share accommodation. The rising housing costs have decreased homeownership. Thus, this created a more significant crowd of home renters. The prices for renting an entire home increased in parallel to growing demand [1].
Therefore, the weakest group of the renters get compelled to share housing as it is the most affordable option. In previous research, this group is referred to as "Generation Rent" mainly consisting of millennials born between the years 1986-1996 [13,14]. As digital platforms increasingly mediate the access to share housing, researchers express their concern about these systems. This societal problem can get addressed by investigating rental and shared housing platforms [23]. Although the sharing economy has noticeable advantages, the extensive use of platforms as Airbnb has created gentrification in densely populated areas, such as Stockholm. Renting out short-term instead of long-term generates more income for the landlords. This phenomenon increases the present competition to find housing in the limited rental market [14].
PropTech
PropTech is generally recognized as a medium to prevent wrong decisions among buyers and tenants. However, dissatisfaction after moving is common due to the lack of information. For instance, insufficient information about the property, neighborhood, and transportation options can lead to unsuitable settlement [7,37]. Through PropTech, exhaustive information has the potential to be presented by the implementation of some technical functions. Big data can provide neighborhood insights, such as crime rates and median age. Artificial Intelligence (AI) can help tenants to find and match with new roommates.
Visual information of properties can be enhanced through Virtual Reality (VR) and Augmented Reality (AR). With these visual technologies, the user can virtually see an interactive 3D floorplan, inspect each room, and view it through 360° virtual walkthroughs [34]. However, researchers state that current PropTech platforms lack many of these functions leading users to wrong decisions.
The users' demographic, financial, and location-related preferences are making up their search queries [10].
Although the search-function is crucial in PropTech platforms, current design solutions are unsuitable to the users' needs. This phenomenon makes users' get exposed to a complicated, inefficient, and time-consuming process [15]. Previous research has shown that most platforms lack the function of comparing multiple listings [21]. Existing platforms should get evaluated simultaneously as the users get investigated to advance future PropTech solutions. If a product is customizable and adds value and satisfaction to the customer, it can get distinguished as user-centered [30].
A fundamental problem with the existing research about PropTech is that the majority focuses either on Airbnb, real estate brokerage, or smart homes. There is limited research regarding platforms supporting long-term rentals. More specifically, there is a research gap regarding the user needs and how the rental process digitally can be streamlined according to their needs.
METHODOLOGY
Ontological position and strategic data approach In this study, the methodological outlook is based on the ontological orientation of critical realism. As the reality of a situation is perceived imperfectly depending on the individual judging the phenomenon. In this exploratory study, critical realism is relevant as the design recommendations were developed to fit the preferences and needs of a specific user group [20]. Consequently, post- positivism becomes the epistemological standpoint, as knowledge is generated by subjective information provided by individuals representing the selected demographic group [10]. The epistemological standpoint promote that the reality must be subjectively perceived, by conducting qualitative studies. The exploratory research strategy was selected as this study aimed to find information about an unknown phenomenon where no hypotheses existed. The data became generated continuously as relevant users' were examined [19]. The data in this study was approached with inductive reasoning [20], as the study aimed to provide
knowledge in the limited knowledge area of user research in the context of PropTech.
Method
The qualitative research method got chosen, as the study's rationale is to understand the participants' problems, needs, and feelings regarding existing PropTech products and rental options. As stated in the literature, qualitative research is appropriate for examining novel products and their target users [25]. Qualitative research can deeply explore the challenges, needs, and feelings of users', which contradictory can't be measured quantitatively [18]. In Human-Computer Interaction, the design process is iterative and consists of the phases discovery, design, and evaluation [29]. Due to the exploratory approach, this study delimited its focus to the discovery phase, and extensively researched the prerequisites for the future development of useful PropTech platforms. This study's qualitative methods consisted of a landscape analysis, semi-structured interviews, and a focus group. The aforementioned data collection methods complemented each other, as each contributed to different types of insights, which get described below [16].
Data collection Landscape analysis
Before the user research, the data collection began with a landscape analysis of existing PropTech platforms and rental intermediaries to understand the current technical features and location-related data. In this stage, divergent and mutual patterns of the user journey got identified.
Moreover, thirty user reviews were analyzed to pinpoint problem areas of the PropTech platforms, as the understanding of users’ common challenges is an essential component of this study. Lastly, the Information Architecture (IA) heuristics were applied to evaluate the PropTech platforms. The IA set of heuristics were selected as they incorporate the essential Nielsen heuristics and extensively add multiple user-centered heuristics [25]. By using the IA heuristics, the objective was to identify the advantages and disadvantages of the interaction. The insights gathered from the landscape analysis established the foundation for the semi-structured interviews and focus groups.
Sampling
The user research, conducted by semi-structured interviews and a focus group, consisted of the same participants.
Therefore, the sampling gets described before each method get explained in detail. Sufficient results get generated when the sampling is appropriate and adequate concerning the research aim [38]. Since the rationale of this study was to identify requirements for the development of a rental PropTech platform, the participants had to consist of potential end-users. The demographic features among the population which live in rental properties may be immense.
The sample in this study consisted of the most vulnerable group of this societal problem. Based on recent statistics, news articles, and previous research, young full-time students were selected, both Swedish and international, and any gender. All of them either lived in Uppsala or
Stockholm. They were in the ages of 20-25, which is the youngest part of the millennials and is also addressed as
"Generation Rent" in previous research [14,23]. Although the interviews initially were planned to be operated offline;
precautions had to be taken due to the outbreak of COVID-19. Hence, the interviews were conducted online, through Zoom, a cloud-based video conferencing service.
Furthermore, eight participants got selected in total, and they were recruited by a snowball sampling as the initial students were requested to bring eligible student participants. Since the focus was on students, snowball sampling was the most suitable to reach this network of people [39].
User research
Semi-Structured Interviews got conducted on 10 participants for approximately one hour. Prior to the interviews, the participants were asked whether they allowed a voice recording of the interview, as they simultaneously were explained how the data would be stored and processed. The interview questions triggered deeply insightful discussions about the problems and fears [19], which the participants encounter when they have attempted to find rental housing in the past. A pilot test got operated before the interviews. The pilot test gave awareness regarding binary questions leading to yes or no answers, possibilities for new questions, and if the designated time frame was sufficient [16]. The thorough exploration of the participants' problems and fears, together with the landscape analysis, established the structural core of the upcoming stage, the focus group.
Compared to the problem-oriented interviews, the focus groups complemented this study by specifying opportunities in the rental process. Focus groups are suitable in the early stages of product development [18].
Semi-structured interviews also got used in the focus groups. User journeys and service blueprints got presented with common problem areas. Each touchpoint got discussed, and alternative solutions were addressed [26].
During the sessions, several ideation tools became used to trigger innovative thinking and discussions [31]. The focus groups got performed with five participants, some of the same individuals who got interviewed previously and already gained insights into the research aim [33].
Data analysis
The landscape analysis created a prominent pattern of the user journey. Furthermore, a content analysis got performed on the collected data from the semi-structured interviews.
The raw data was initially transcribed, assigned codes, and divided into themes. The data from the focus group got categorized through affinity sorting. The affinity sorting generated patterns of the data [16]. The codes and themes which derived from the user research, were particularly about problems and solutions within each sequence of the user journey. The combined data constituted an overview of potential solutions to the identified problems for the specified user group.
Ethical considerations
The participants were initially informed about the research aim, so they were aware of their involvement as a prevention to problems. Secondly, the participants were informed about their right to end their participation at any moment if they requested. If any problem would occur and the participant quitted the study, all of their data would get deleted, and the participant would get replaced. Thirdly, the participants got informed regarding which and how personal data would be stored. They also got informed that there are no correct or incorrect answers to prevent any participation anxiety. In addition to this, they got informed that the data exclusively were used for research purposes [35]. Furthermore, there was a risk this qualitative study generated subjective data given the focus on students and their problems and preferences regarding PropTech.
Method implications
Another exploratory research approach is contextual inquiry. Although it contains semi-structured interviews, it got excluded as it is suitable for use in the users' natural environments [18]. Since PropTech is unestablished in Sweden, it is unfeasible to observe the users' when they interact. Furthermore, the sequence before renting a place may extend over a larger time-period and in different ways.
Hence, observing the users' in their natural environments was unsuitable in this case. Diary studies could also get used, but it requires much effort from the participants, as they have to document their activities over a more extended time-period. It would also be challenging to find and recruit students in search of rental housing for a diary study [16,19]. Regarding the method, a quantitative approach could be applied in this study, for instance, to measure the attitudes towards PropTech. However, since the study is exploratory and aims to understand the users' problems and needs deeply, a numerical measure would not be suitable.
RESULTS
The data was collected through different approaches, as each part constituted the foundation to answer the research questions. Initially, a landscape analysis got conducted, followed by the user research, consisting of semi-structured interviews and a focus group. Below the results from each approach is presented.
Landscape Analysis
Before the user research, a landscape analysis got conducted on PropTech platforms and rental intermediaries.
The landscape analysis began through searches on Google, with keywords such as "rent housing in Stockholm/
Uppsala". This approach got chosen as the sampling group consisting of students, hypothetically, initially start searching through Google with corresponding keywords.
The first thirty search results got examined, and the analyzed attributes included the type of website, technical functions, location-related data, and listing data.
Twelve of the results were classifieds websites, and eleven were rental intermediaries requiring paid subscriptions for either viewing a listing or contacting the landlord. However, nine of the twelve classified websites were search engines collecting the listings from other classified websites,
PropTech platforms, and listings from Facebook Marketplace. Among the thirty results, only four were PropTech platforms, while three were affiliated with property developers.
Among all analyzed websites, the identified technical features were as follows: (1) Photos of the listing, (2) Interactive Google Map with the listing marked, (3) Option to favorite mark, and (4) Geolocation search, (5) Chatbot with the support-team. Listing-data and location- information were frequently intertwined and presented inconsistently as the listings were depending on the publisher's descriptions. Regarding the location, only the address was presented and sometimes the nearby bus- and train stations. Apart from the individual text descriptions, the listing data irregularly got presented according to a standard of amenities. The data was regarding the availability of parking, washing machine, wheelchair accessibility, internet connection, balcony/outdoor space, pet allowance, and finally, private or shared toilet and shower. Moreover, the size, rental price, accommodation type, and moving dates were also displayed sometimes.
As PropTech is in a nascent phase of development in Sweden, five renowned international platforms got taken into consideration in this study. Their negative user reviews were analyzed to pinpoint frequent problems. The majority of the user reviews were regarding customer service and policy disputes. However, the analysis got delimited to reviews regarding design and functionality. According to the user reviews, frequent problems were (1) unverified listings, (2) Algorithms creating inaccurate valuation of properties, (3) Insufficient information about properties leading to wrong decisions, (4) Limited functionality on mobile devices, (5) No comparison function.
Furthermore, these platforms got evaluated according to the Information Architecture (IA) heuristics. Regarding the first heuristic, finable, the listings were easily located yet through unnecessary steps of interaction. The amenities of the listings got shown according to a standard.
Nevertheless, if some information was missing, a separate tab had to be opened, and the search was done manually through Google. The second heuristic, accessible, was identified as problematic when the platforms got evaluated.
Although the websites were responsive, some functions were missing. And when the application version of, e.g., Movebubble and SpotAHome got downloaded, there were many bugs. Furthermore, functions supporting people with disabilities were nonexistent. Across the platforms, the language was clear, as in regards to the third heuristic.
However, the arrangement of the content was frequently not correctly prioritized as FaQ could appear in a sidebar next to the listing.
Regarding the fourth heuristic, communicative, the user interface was well structured on the evaluated platforms.
The platforms were producing the intended result with their design. Therefore the fifth heuristic, usable, was fulfilled.
During the evaluation, heuristics which could get more taken into consideration, were credible and controllable.
First of all, there was no type of design incorporated which communicated that a listing is credible. Secondly, there were not enough filter attributes, in particular mobile views and applications. There was no distinctive problems regarding the heuristics, valuable, learnable, and delightful.
Throughout the landscape analysis, a prevailing pattern of the user journey got identified. The sequences comprised of (1) Finding the listings, (2) Filtering the listings, (3) Contact with landlord, (4) Viewing the property, (5) Closing a deal. These sequences established the foundation for the interview-script in the upcoming part of the data collection.
Semi-Structured Interviews
After establishing the sequences in the user journey, an interview script got developed accordingly. In addition to the predefined interaction sequences, the interview script got extended with another two sequences; Moving in and Post moving feedback. After processing the data with a content analysis, mutual and divergent problem areas got identified and presented below.
Finding the listings
All interviewed participants expressed negative feelings when they recalled how their experiences with finding rental housing has been in the past. For instance, some derived feelings were hopelessness, pessimism, rejection, desperation, and panic. Additionally, the participants with a foreign background found the Swedish rental system dreadfully confusing and complicated. Although Swedish participants had problems with the rental system, it was particularly difficult for the international students. A foreign participant said: “It is really complicated [...] Although I have been living in Sweden for more than 1,5 years, I still have no idea about a central website where I can find the housing listings”. An answer pattern that emerged was that there is not enough transparency for the international students, and that the rental intermediaries assume everyone knows that there is a housing shortage and waiting lists in Sweden that can last up to several years.
Furthermore, many foreign participants had to ask local friends and search on blogs to find an adequate platform to begin. Another foreign participant expressed: “[…] finding the right method to search for housing can be tricky itself.”
while another participant said “The only source I had (to find rental listings) was blogs and chatrooms”. However, both the Swedish and international students acknowledged that there is no central website for this purpose. Therefore, most of the participants embarked on their search process through Blocket, Studentboet, Facebook Marketplace, or joined housing groups on Facebook. Many of those who studied at Uppsala University contacted the Housing Office or some of the Student Nations.
Except for the fact that there is no sufficient central website with rental listings, the second challenge is the listings themselves. A local participant said: “It takes away a lot of fun in the experience of studying […] there is not enough information available and sometimes it feels like information is hidden”. Across all the aforementioned rental intermediaries, there is no standard structure
regarding how the data and photos got presented. Three participants expressed their frustration regarding the descriptions in fluid text format, which the landlords write themselves. In most of the listings, most of the information about the listing was within the descriptions. The problem with this is that much essential information was excluded based on what the prospective tenants need to know. A participant described this frequent problem: “It feels like the people which upload these ads don’t understand the target group […] for example I have no interest to know which is the closest florist's shop, but rather to know how many square-meters the apartment is”. For the international students, this was also problematic in terms of English translation, as it commonly was nonexistent across the intermediaries. The preliminary solution to this was using a Google Chrome extension or just pasting the text into Google Translate. An example from a foreign participant is:
“Except from the poor description of the listing and limited amount of photos, I also had to translate the text by myself”. Another challenge was identifying which listings were scams or legitimate, as some of the students had heard of sophisticated scams across the rental intermediaries.
It appeared that all of the participants prefer browsing for rental-listings on desktop instead of mobile devices. The mobile devices got avoided as perceived as slower, with a slower screen size and limited user interface. A participant said: “I never do it through mobile device […] because you can’t decide about something that you have to spend most of your time in, for years probably. Therefore, I want to have a clear overview through my computer”. The majority of the participants also mentioned that they would prefer a website instead of downloading a mobile application for this purpose. Downloading an application was seen as useless as it first would be used over a shorter period, and secondly, the users didn't know if it was worth the time to download and register in the application.
Filtering the listings
When browsing the listings, the participants greatest challenge is considering transparency, which could also lead to suspiciousness whether some listing was a scam.
Since there is no general structure in the platforms regarding how the results are displayed, a lot of meaningful data got excluded. For instance, many participants mentioned that there is not enough contract-related information, e.g., a period of notice, moving dates, or contract type. A participant expressed: “Many times I could not find information about the included amenities, but the greatest problem was to understand what type of contract it was and what actually got included in the price. When I contacted the landlord to ask […] I rarely received a reply”. Furthermore, there is no transparency regarding the costs involved, and this can be particularly challenging for students who are not economically stable. Some participants explained that many of the listings they considered did not mention whether the electricity, water, and broadband connection got included or not. In addition to this, some participants explained their frustration regarding the limited information about amenities. A
common question to landlords was whether vacuum cleaners and washing machines got included in the listing.
Furthermore, some of the participants said they would appreciate it if a listing also would contain some negative things, as every property always has some type of flaw, whether it is poor sound isolation, or a water bed.
The participants did not only perceive the limited listing data as insufficient but also the limited visual data. Every participant explained it should be unacceptable to upload listings without photos, as it currently happens frequently.
A participant stated: “I don’t even consider listings without photos. […] I don’t see the point why people upload ads like that”. When a listing did not contain any photo, some of the participants mentioned that their trust also got affected as they assumed the advertiser hid something. However, when a listing had a photo, it rarely had any of the exterior, leading the participants to open Google Street View and see it from the outside and the nearby area. The participants also explained that they had to open Google Maps to check the distances and time to walk or commute to points of interest, such as campuses and nations. Depending on the landlord's description of the listing, the distances were sometimes mentioned, but often inaccurately.
Except for opening Google Maps and Street View in new tabs, another major problem was the lack of comparison and quick view functionality. Every participant had to open the new listings in new separate tabs to compare them one by one, since there was no option to mark them and later compare them all in a table view. A participant said:
“Regardless if I am browsing on Blocket or Studentboet, I always have to open new tabs to compare the ads”.
Furthermore, many participants explained they opened a listing in a new tab because if they click on a listing and then go back, the whole page would reload, and they would have to start from the top of the page again. Another frustrating experience when browsing and applying for rental listings was that many were passive and outdated.
Some participants mentioned that the landlord would never reply or say that the listing already got rented out. An example from one participant was: “I rarely received a reply for my applications […] the same scenario is relatable for other students as well”.
Contact with landlord
When the participants applied for a listing, the most common problem was that the landlord did not answer.
Furthermore, the participants explained that the landlords rarely gave information about the required tenant background, which would be valuable in advance instead of putting more time and effort into applications that would not be considered either way. A male participant expressed:
“I have noticed that men get less replies from female landlords. I would at least appreciate if the tenant requirements were presented somewhere in the ad […] so I don’t waste my time in applying”. A third problem regarding the interaction with landlords was that if they responded, they only answered some of the tenant's questions.
Many of the interviewed students felt the housing shortage in Stockholm and Uppsala, forced them to consider shared accommodation. But the problem in this case was to filter the roommates, and even to view their profiles. Some participants discussed about their privacy concerns, and said they would only be comfortable with a short descriptive profile of themselves, if they in exchange could access the same information about the potential roommates.
Two of the interviewed females explained that although the housing shortage is leading to much desperation, the co- living is twofold: they also have to get an understanding of their roommates background, as some females would not prefer to live with an older man.
Interestingly, all of the international participants explained that they formulated a personal application letter in Swedish, although they were not comfortable with the language. A foreign participant said: “Due to my desperation, I had to apply in Swedish although I was not comfortable with the language […] because there was an increased chance to receive a reply from the landlord”. The reason for this was because they had experienced that almost all of their applications in English got declined. The majority of the participants expressed they felt uncomfortable when a listing only contained a phone number to call, and expressed they would prefer sending a message across an intermediary rental platform than phone calls or e-mails.
Viewing the property
The most significant challenges in finding the rental process were browsing among the listings and receiving a reply from a landlord. However, when the participants managed to interact with the landlord, the next two challenges were (1) to view the property and (2) meet and create an understanding of the roommate. The first point was not a particular problem for the local participants. However, it was a significant challenge for the international students who were about to move to Sweden.
Two of the participants mentioned they had a video call through Skype to view the property and get to know the roommates. However, there was still some uncertainty as it was not in reality; real problems could not be identified, such as horrible property odor and sound isolation, working appliances. One participant said: “Not just finding housing is a challenge, but making sure it is as expected through the descriptions and photos”.
Additionally, the participants got asked how come they had moved short-term, e.g., AirBnB without actually viewing it in the past. The majority said the current platforms lack so much data about the listings, verifications, guarantees, and reviews that they would not consider. However, they suggested they could imagine it in the future if the features above got considered. A participant said: “Airbnb is more established than any other platform regarding rentals. The company always show extensive information about the property as well as photos. In addition to this there are reviews available […] these (factors) must be taken into consideration in a future housing platform”.
Closing a deal
In their past experiences, the participants described their worries before signing a contract. What worried them most was the terms, which could be unclear and lead to significant economic consequences if misunderstood. Three participants explained that the period of notice, moving in and out dates, type of contract, and what got included could be quite confusing. Furthermore, many associated closing a deal with a considerable risk. They did not know what to do if a place was not as expected. For instance, worries that could arise were what do to, which authority to contact, which insurance they were covered. A participant said: “As an international student, I had no idea what guarantees I had if the apartment was not as expected […] I also did not know what type of laws could be accurate for me as an international student if something went wrong”. Two participants expressed they would like to have some guarantee the first week after moving in.
Moving in
When moving in, the most commonly mentioned challenge was moving the physical stuff. One of the participants with an international background explained that a quote was requested to a car rental company but got declined because the driver's license was foreign. That participant added:
“[…] international driver’s licenses should also get accepted […] and the moving companies should be more accessible in english and through a website”. Furthermore, two other participants mentioned it was difficult to get an overview of moving companies, and their prices as the majority of these companies did not have a website but instead a phone number. Furthermore, some participants wish they could have a checklist and help regarding what to do when moving, for instance, a central website where they easily could change their postal address.
Post moving feedback
When the interviewed students reflected on their experience with finding rental housing in Uppsala and Stockholm, they acknowledged that there is a social housing shortage. But, based on the challenges mentioned above, many pain points could be prevented by design developed of a better understanding of the target users and their needs. The majority of the problems primarily considered transparency, safety, and clarity.
Focus Groups
In the previous section, the problems from each sequence of the user journey got explained. These problems got presented in the focus group within a horizontal user journey. Together with the participants, some solutions got proposed for each problem in the rental process.
A rental-intermediary PropTech platform should have a standardized structure regarding what type of information gets presented. For instance, it should get required to show each room's pictures and show all the involved costs. The overview of the listing should get designed so that the essential data get prioritized and highlighted first. The design should be clear, and less important information should appear further down.
Furthermore, it should get developed as a website, not as a mobile application. The website should be able to show the same information in English as well for foreign users. Also, there should be a section, explaining how the Swedish rental system works, and how rooms are counted in Sweden, as it appeared in the interviews that rooms are counted differently in Germany, which could be misleading.
Since security is essential, the users on such a platform should get verified through Mobile BankId or the social security number of foreign users. Simultaneously the majority of the participants expressed worries regarding their privacy. Therefore they suggested their biography should get shown as an overview. Their extensive profile should be unlocked if the users accepted the request from others. Furthermore, after creating a profile on a such platform, they would prefer receiving notices through e- mail.
The participants did not express any worries with paying a standard service fee in exchange for a transparent, safe, and useful service. However, they would not like to pay to view or contact a landlord, as many of the current rental intermediaries require. They could imagine doing this when a contract is signed online, and a deposition is sent across the platform.
Since passive listings were a significant problem, the platforms should have an automatic function that deletes a listing after the landlord has not interacted after one week.
By showing relevant and accurate listings, the filters should get developed accordingly. Hence, the users should initially be able to choose what type of accommodation they prefer.
Some examples are: studio, corridor room, shared apartment or room, with private or shared toilet or shower, living with a family, or an entire apartment. Another request was to input how many people want to rent, e.g., a couple, two friends, a single person.
When browsing among the listings, the participants would like to have some filters that fit according to their everyday needs of amenities. Some mentioned examples were flat iron, hangers, vacuum cleaner, hairdryer, washing machine, dishwasher, basement/storage room, balcony, ventilation system and carbon monoxide detector/fire alarm.
Furthermore, the participants would like to know what type whether the listing had a radiator or heat pump and what type of cooktop, e.g., induction or ceramic. In addition to this the participants requested to know whether pets and smoking were allowed, and if the area is quiet or loud. In addition to the aforementioned, filter settings to adjust the maximum price, floor, construction year, square-meters, type of door and security alarm would be appreciated by the users. The majority of the participants stressed the importance of knowing whether the listing had access to bicycle parking, and two participants mentioned it would be good to know if a car parking was available.
Since the participants got used to having open tabs to compare listings manually, a function should get implemented where selected listing can get overviewed in a table. Furthermore, a quick view feature should get
developed as participants became frustrated with the pages, usually updating and starting from the top when they clicked on the back button.
Understanding what is included before signing a contract is essential. Therefore, each listing should clearly state what gets included in the contract. For instance, some standardised fields should be a period of notice, moving dates, type of contract (lease-holding or sub-lease).
Furthermore, transparency about the pricing is essential.
Each listing should also contain precise data about the included and excluded costs about the rent, monthly fee for the property community, electricity, wi-fi, water and deposition. Moreover, the participants stated that transparency with potential flaws would be appreciated, e.g., water bed and bad sound isolation.
Distances were often inaccurately presented in the listing description. Therefore the participants suggested five standard location-related data; distance in kilometers and time to walk or commute to the following: closest grocery store, campus, nation (in Uppsala), city center and café.
Furthermore, there should also be a map integrated where the user manually set the destination and find the route and time to travel from the property. Besides, each area should get explained as not every user is local. Additionally, the search results should be delimited to the inserted area and only show other results after asking the user first.
Furthermore, in each listing, an Application Programming Interface (API) from Google Maps Platform should be integrated into each listing. Through this, big data could get aggregated, and for instance the crime rate of the area, median age, and quality of schools could get presented.
Before uploading a listing, the landlord should have inserted the requirements about the tenants, e.g., occupancy status, income, age, gender, local and international students.
Furthermore, if a prospective tenant wants to contact a landlord and see the information, both of the parts should be registered, and a basic preview of their profile should get shown. If a prospective tenant request to contact a landlord, their information should get unlocked after a confirmation.
Furthermore, the landlord should be required to notify the applications through a yes or no, so the tenants know the status of their application. Some of the female participants also requested the function to filter the landlords and roommates to only females. Each landlord should also describe if they live and request a quiet or lively roommate.
The personal biography section should contain information about hobbies e.g. cooking, boardgames, and which subject they are studying. Since the majority of the participants preferred messages across the platform, a chat should get integrated as well as a voice- or video call service if the involved parts would like to get to know each other better.
Most of the students who are looking for accommodation in a specific area are usually not locals. Hence, many do not have the opportunity to properly review properties before moving in. Therefore the visual information should be as transparent as possible. Firstly, a floorplan should always be shown, as well as photos of each room. In addition to the
photos, 360° virtual walkthroughs should be available, with points of interest or voice descriptions. This would prevent users from opening Google street view to check the exterior of the property. In addition to this, aerial images on the exterior and the area was suggested. In order to increase the security, a home inspector from the rental intermediary company should be sent to the listing to record a video of it.
The main challenge in this sequence was related to the payment. Questions that derived were the uncertainty of whether the property would be as expected and if all the amenities would be included and work correctly. The second challenge related to the payment was whether the listing was a scam. The solution would be to freeze the deposition on the PropTech platform and only let it pass, if a tenant confirmed it was as described. In addition to this, the contract should be signed through the platform as well.
The greatest challenge regarding moving was the physical aspect. Since many of the existing moving companies (A) don't accept foreign driver licenses and (B) many don't have a website. A PropTech platform should integrate direct offerings from existing moving companies and accept international driver licenses. Additionally, there should be a moving checklist in the platform that helps the students register their new addresses.
DISCUSSION
How can PropTech streamline the process of finding long-term rentals?
To answer the primary research question, the notion of process in this context must be distinguished. The landscape analysis in this study indicated a pattern of the user journey, which is constituting the process. The sequences are: (1) Finding the listings, (2) Filtering the listings, (3) Contact with landlord, (4) Viewing the property, (5) Closing a deal, (6) Moving in and (7) Post moving feedback. Prospective PropTech platforms can streamline the process by incorporating each sequence and simultaneously advance each of them. Based on the identified challenges and suggested solutions, a such platform can operate as a medium to solve the common challenges, described below.
What problems do prospective tenants encounter in search of long-term rentals?
Apart from the housing shortage, which is a societal problem in Sweden, prospective tenants also face challenges in search of housing. Existing PropTech platforms and rental intermediaries only assist partly in the process and make their services insufficient due to poor understanding of the target users and their needs. In addition to this, the information architecture is commonly structured in an illogical hierarchy. In the identified user journey, a prominent pattern of challenges is associated with a lack of transparency, reliability, privacy, and feedback. The major challenge regarding transparency was the inadequate and inaccurate data of the listings. The listings were often passive, with an unclear description and often in Swedish. Furthermore, the photos were often very limited, and the participants felt that if the listings were hiding information. Transparency was also important when it came to the contract and what is included in the price.
Furthermore, a key factor for using rental intermediaries was reliability. Since fraudulent activities occur in this context, the prospective tenants want to be assured that the listings and the landlords are verified. Privacy is also essential, since many participants expressed their worries about how their personal data is stored and presented to other users. The lack of feedback from existing rental intermediaries was causing frustration for the users, as all of the participants' experienced getting their applications ignored at some point.
What technical functions and location-related information is essential in future platforms?
Although the participants suggested many requested functions, the ones that were frequently mentioned were distinguished as essential. Firstly, the design must be cohesive both in terms of visuality and based on the data presented. A requirement is that each listing shows clear pictures, presents a standard set of data, and contract-related information. If an intermediary platform is publishing the listings, the service should incorporate 360° photos of the listing, followed with virtual walkthroughs or an interactive floorplan. In addition to this, there should be pictures of the exterior of the building and area, just like real estate websites in Sweden. Since many of the tenants who search for housing are foreign students, all the information should be available in English as well. In addition to this, there should be a clear section explaining how the Swedish system works. In order to apply for listings and publish listings, there should be a verification system implemented, such as Mobile BankId or by social security number. The deposition should be sent across the platform and saved there until the tenant confirms the listing is as described. In order to prevent passive listings, they should automatically get canceled if a landlord stops replying to messages in a week. Since applying for passive listings is time-consuming for prospective tenants. Furthermore, the user should be able to insert what type of accommodation s/he prefers, as well as how many people want to rent. Another essential function is the ability to compare listings in a table view. In relation to this, the users want to be able to quickly view a listing instead of risking a refreshment of the entire page. A standard set of distances should also be presented, e.g., to grocery stores, campuses, gym. In addition to an API from Google Maps Platform should be integrated, so the users can see the median ages of areas and their median age.
Moving quotes should also be available and integrated into the platform.
Implications and future research
During this study, some implications derived in terms of transferability. Although the research results apply to the delimited target group and in areas such as Uppsala and Stockholm, the generated data may not be irrelevant to the development of other residential PropTech platforms focusing on couples, elderly or wealthy individuals.
Furthermore, there are cultural differences when it comes to rent around the world. For instance, a rental PropTech platform may have do be developed differently in eastern countries, where the general conception of gender and integrity may differ from the western culture. Hence, the
transferability of this study limited by population type and situation. More data could also get generated if practical issues did not delimit this study regarding feasibility. For instance, if there was more time, financial resources, and specialized equipment available, more substantial data could be gathered.
Due to the outbreak of COVID-19, precautions had to be taken. Therefore, the focus groups were conducted virtually through Zoom. Non-verbal cues such as body language were therefore excluded, although they presumably would not have affected the results. This phenomenon also raises new thoughts on how the decreased physical allocation can affect PropTech in the future.
The advantage of this study is that a relevant problems got addressed from an explorative approach by identifying the problems and the needs of the user group. The upcoming sequence of the user-centered design process would be regarding validity, by implementing the functions into prototypes and conduct user testing.
The results of this study opened new avenues for research;
instead of suggesting a different approach e.g., quantitative, I would suggest further research regarding each component, which was found to be crucial for PropTech. For instance, what type of data infrastructure is appropriate for safe storage of the users' personal information. Furthermore, research in terms of information architecture is relevant. By design research, it can be identified how the functions are hierarchically arranged and communicated through design, leading to increased usability. Lastly, it would be of great value to investigate the other user of a such platform, the landlord. By focusing on their problems and needs, a more efficient communication platform could be developed.
Conclusion
This study concludes that PropTech is in its nascent phase, both in Sweden and internationally. Although many international platforms are aesthetically pleasing in terms of the visual design, they have shortcomings in functionality.
In order for rental intermediary PropTech platforms to be useful, all sequences of the identified user journey should be incorporated. In each sequence, the aforementioned solutions should be implemented. The prerequisites for streamlining the rental process is the design and communication of: transparency, reliability, privacy, and feedback.
In the table below, the prerequisites are explained in particular.
Table 1. Summary of the prerequisites for streamlining the rental process through a PropTech platform.
Prerequisites Summary
Transparency
The listings should provide exhaustive information about what is included in the contract and the set price. Data should also be provided about the property and the area. In addition to this, visual information such as photos, 360° virtual walkthroughs, and floorplans should be available.
Reliability
Security is essential for future PropTech platforms. The meaning of this security in this context is two-fold;
regarding the involved users and the transactions. To prevent fraudulent activities, both the prospective tenants and landlords should be able to access the platform after a verification through Mobile BankID or social security number. Regarding the transactions;
the deposition should be stored within the platform until the prospective tenants confirm the listing was as advertised.
Privacy
The users should be aware of how their personal data is stored and presented across a such platform. They should have the ability to adjust and delimit their presented data to other users. The users’ biography section should only be accessed after a request gets confirmed by the other user.
Feedback
Feedback and communication among the users is essential in future PropTech platforms. Landlords should be
required to mark the status of an application by accepting it or declining it. Furthermore, the platform should support the post-moving
communication between the tenant and the landlord.
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