Although the real estate sectors in Singapore and Indonesia have experienced slowdowns at the beginning of the year due to the COVID-19 pandemic, these markets are bouncing back to become stronger than before, especially after both countries ended their large-scale social restrictions and lockdown policies two months ago, according to a recent survey conducted by Singapore-headquartered property marketplace firm 99.co.
“We saw transaction volume in April and May significantly drop by 60% in Singapore and Indonesia, but it has completely recovered in June,” co-founder and CEO of 99.co, Darius Cheung, told KrASIA in a recent interview.
This situation spurs property developers and agents to spend more time on generating content on 99.co. “For example, we have always had a feature called Video Listing, where agents can upload a video into their listing so potential customers are able to watch them online. This is a free service, but requires some efforts from the agents,” he said, adding that the service has been available for two years, but only around 5% of agents used it before the pandemic. Cheung saw a fivefold jump in this feature’s utilization during the pandemic, when in-person viewings were limited or even impossible to conduct.
“Within the first quarter of 2020, the number of agents who uploaded videos increased from 5% to 25%,” said Cheung. He believes the pandemic could be a catalyst for conventional real estate agents to adopt more digital services as part of their sales strategies.
To make the transition easier, 99.co provides online training to help real estate agents step up their game by using online platforms. The pandemic has helped the company move this development along, Cheung said.
“We definitely see this as a sort of ‘once in a lifetime transformation’ for the industry. We have been pushing the agents to do a better job and create more trustworthy and engaging video content, but they were reluctant to use it. The pandemic really gives them no choice but to learn how to use it, especially since they had plenty of time on their hands.”
Real estate is an industry that is set in its ways, at times even resistant to change. It still relies on in-person showings, billboard ads, posters on buses, and public events in shopping malls that involve celebrities or influencers. But in the last few months, all of that has changed. “We certainly see real estate agents transforming their strategies, and we are getting very busy in trying to help them take things online,” Cheung said.
Agents and buyers now rely more than ever on virtual expos, he said. Still, photos and textual descriptions are not sufficient for housing listings, so agents and developers have had to find ways to provide virtual tours, making sure that potential customers can examine properties as closely as possible. After all, major purchases demand tighter scrutiny.
“Although there are some aspects that cannot be captured with online expos, we provide services to simulate a real-life experience for customers,” Cheung said. “For example, we are currently working with a developer for an upcoming online expo where customers can engage in direct communications with consultants and get a good view of the properties through virtual tours and open houses. We estimate the level of efficiency and experience in the online expo is around 70%.”
Cheung believes this development is here to stay, and that customers will also adjust their expectations and behaviors within the next six to 12 months.
“On average, customers will go to 20 home visits before deciding to buy a home, which is understandable because it is a big purchase,” the CEO said. “But as we improve virtual expos and tour experiences, we estimate this number will drop to three visits only, which is much more efficient for customers and real estate agents.”
Strong business amid the pandemic
According to Cheung, 99 Group’s business activity has not been adversely affected by the spread of COVID-19. In fact, the company saw some positive developments. Monthly traffic across three sites—99.co, Rumah123, and iProperty.com.sg—increased from 13 million visits in February to 19 million in June, ticking up when Singapore and Indonesia had mobility restrictions in place. The company’s revenues also increased by 20% in the last six months.
Founded in 2014 by Darius Cheung, Yan Phun, and Conor McLaughlin, 99.co uses “design-centric technology” to revamp online real estate listings. The company is backed by big-name investors like Sequoia, East Ventures, Golden Gate Ventures, REA Group, and Allianz. It has raised USD 33.1 million in six rounds, according to Crunchbase.
In October last year, 99.co acquired two property portals, iProperty.com.sg in Singapore, and Rumah123.com in Indonesia, in a joint venture with Australian property-focused advertising company REA Group. This acquisition positioned 99 group as a potential market leader in Southeast Asia.
“Indonesia is a very exciting market for us as we are a market leader there. With 99.co and Rumah123, we have 70% of market share, so we’re in a dominant position and it allows us to bring more innovation to the market. However, our goal is not to fight for market share, but to bring disruption into the real estate market,” said Cheung.
Besides placing listings on its website, 99.co provides a suite of services to help real estate agents seal deals. This includes tools that generate data for prices, as well as training and guidance for creating video content. “I think the game-changer that we bring is helping them transform the experience of selling a property into a much more efficient and reliable process,” Cheung said.
The platform recently started marking some listings as “verified,” which Cheung says is a differentiator from other marketplaces that often include search results of units no longer available. 99.co’s verified listings are properties that are checked by the company’s ops team.
For property seekers, the feature makes the home-seeking process much more efficient, because it eliminates duplicates and units that may not be on the market anymore. For agents and landlords, verified listings stand out from others, driving more engagement with property seekers.
Another feature that puts 99.co ahead of competitors is its new diversity-friendly listings, which is an optional feature for landlords and agents that use 99.co. The tag indicates that buyers and renters are welcome, no matter their race, ethnicity, religion, age, gender identity, sexual orientation, or physical ability.
“My wife is Indian-Singaporean. When we tried to rent a place in Singapore a few years ago, we ran into many landlords who basically didn’t want to rent us space because she’s Indian. We realized that racism and discrimination exist in this sector,” Cheung said. “We also found out that sometimes landlords don’t want to rent to members of the LGBTQ community, so our goal is to remove this behavior completely.”
“I don’t think we solve the problem [of discrimination], but this is the first step we take as an effort to fight that,” the CEO said.
New products in the pipeline
After raising funds from Allianz X and Mindworks Venture in August last year, 99.co planned to launch property-related financial products for customers. However, the COVID-19 pandemic delayed the roll-out. “We are pushing that back toward the end of the year, as we’re now more focused on helping agents go digital,” said Cheung.
“In many markets in Asia, house prices have risen faster than incomes, so a lot of properties are not affordable, especially for young people. We want to help solve this problem, so even if you can’t afford a property straight away, there are some other ways for you to invest, participate, and get benefits in the property market,” he said, hinting that the products will revolve around lending and mortgage options.
Going forward, 99.co is preparing to enter new markets, although Cheung did not reveal more details. “We’re not ready to speak about that yet, but we may have some news soon. There are six core markets in Southeast Asia, which are Singapore, Indonesia, Vietnam, the Philippines, Thailand, Malaysia. So we’ll stick to these markets,” Cheung said.