Kylie Davis

Welcome to the Proptech podcast. It's Kylie Davis here and I'm delighted to be your host as we explore the brave new world where technology and real estate collide. It's so great to have you here and to share stories of innovation and opportunity across real estate, property and building services. And the aim of each episode is to introduce listeners to a Proptech innovator who is pushing the boundaries of what's possible across how we design, build, buy, sell, rent and invest in property and all of the associated behaviour and activities around that. Now, none of this would be possible without our sponsors. So a big shout out to the Direct Connect team, making moving, easy, dynamic methods, the innovators behind the forms, Live and Realworks forms, and the Proptech Association of Australia. Thank you for your support of the podcast. This week on the Proptech podcast. My guest is Shelley Horton, the executive manager of mortgage Solutions at Proptrack, the property data arm of Realestate.com Au.

Kylie Davis

Now, Shelley has a long track record in the property industry, starting her career as a property valuer and holding various roles at Genworth, and then becoming a buyer's agent and consultant to large corporates, including Macquarie and CoreLogic. So she's experienced the property valuation industry and risk analysis from nearly every angle. Now, at Rea, she's responsible for Proptrack expanding the valuation, risk and mortgage products being created from their data, with a keen eye to the kinds of insights that property buyers and sellers want to know. And in this interview, we discuss the importance of good quality data in helping consumers make confident decisions and how the property data industry is changing, especially for valuers. So, here to tell us all about it, Shelley Horton. Welcome to the Proptech podcast.

Shelley Horton

Thanks for having me.

Kylie Davis

Look, I'm really excited to have you and to hear more about Proptrack and what REEA Group are doing with Proptrack today, I'm going to inflict upon you, though, the first question that we always ask everybody, and what is the Proptrack elevator pitch?

Shelley Horton

So, Proptrack plays a critical role in powering the broader Rea strategy. So we power Rea's consumer experiences and also accelerate the value of our customer products. So in the real estate sector, at the same time, we're trying to unlock new revenue pools through the generation of unique data valuations and insights for the market. Okay, cool.

Kylie Davis

So Propcheck is the data arm of Rea. Am I right in thinking that or is it so much more?

Shelley Horton

No, I guess it's unparalleled data and insights. We support the broader Rea Group in their ambition to change the way the world experiences property. And the way we do that is by supporting that business as well as our own customer base with unique and unparalleled data and insights. So think about it as data and insights on the market and metrics that you wouldn't get anywhere else in market.

Kylie Davis

Okay, so what are some of those metrics that we wouldn't get anywhere else.

Shelley Horton

One example would be supply and demand metrics. So if you think about demand around certain property listings and viewings around property, so interest levels, that's sort of something that you would only get through the Rea platform. I think last count there was well in excess of 12 million people visit the Rea website in any given month. So that's a unique audience that the Rea benefits from and that gives us great insight into what the market is doing and what consumers want to see in terms of the property market.

Kylie Davis

So how have consumers needs evolved or changed as we've got more access to more data?

Shelley Horton

I think anything that really fuels a level of confidence to take those next steps. We know that a lot of people might be thinking about buying or selling, but actually taking that next step sometimes is a hurdle for them to overcome or a challenge for them to overcome. So we work on providing them with information and data that gives them the confidence to act, whatever that might be. And so that's through that entire real estate lifecycle or transaction cycle. But also then if you think about the mortgage or those sort of ancillary industries that feed off the back of real estate, in proptrack in particular, our products are really designed to support that entire end mortgage lifecycle as well. So whether somebody's thinking if you think about it, valuations in particular is a big focus for us. And the value of a property is critical.

Shelley Horton

Whether you're thinking about selling, it gives you an indication of what you might get for the property. If you're a buyer or a property seeker, it gives you some sort of insight into what you might have to pay for a property. And if you're just looking to finance, if you're an existing property owner, it also provides some insight into what loan size you might be able to get in terms of that indication of what your existing property is worth so fundamentals to that entire process. And that's sort of why we focus on or why we're focusing on valuation products as part of our strategy, but just any information that gives people the confidence that they're not, for instance, paying too much for a property or they might be getting a good deal, or they might better off sort of waiting or looking in adjacent areas.

Shelley Horton

And so anything like that can arm the consumer and give them the confidence to make a sound decision is really what we're all about. Awesome.

Kylie Davis

So you guys have recently released Real Estimate, is that correct?

Shelley Horton

That's right. So that is proctracts AB empowering realestate.com au real Estimate. And I think off the back of that we've now about a third, I think, of households tracking the value of their property, which goes to what everybody's interested, how much is my property worth or how much is that property I'm interested in worth? If you're thinking about buying?

Kylie Davis

Yeah, look, I think I have actually signed up to it.

Shelley Horton

Oh, good.

Kylie Davis

I think my house is one of them because every week I get an email telling me what sold around me, what prices have been achieved and therefore what my house is probably worth in light of that information.

Shelley Horton

Exactly. The model is designed to update based on those new data inputs that come about every day and every week as new properties transact in market. As we get new intel on properties that are listed for sale, the model updates in real time and gives the most up to date reflection of what's happening in your suburb, in the adjacent suburb, et cetera. So whoever's tracking their property, they get those insights. And one of the things that Propdack does as we get feedback from or the rest of the business gets feedback from consumers in terms of the information they want to see. We'll then power the group with new data and insights that we might serve up in those regular updates for those that are tracking their properties. So the market will tell us what they want to see and then we'll deliver those metrics and insights that help inform you and give you the information that you're seeking.

Kylie Davis

I'm going to confess, it does regularly spark very interesting conversations between my husband. It's always good fun. But it's one of the frustrating things for Proptrack because as a consumer it is the number of real estate agents who still say, oh, you need to call us to find out how much that sold for because you still get that inside the reports too, don't you? Like, oh, we're not sharing that information, you have to call us. It's like why? You're not going to return my phone call anyway.

Shelley Horton

Look, I think the availability of information is critical, whether there are certain requirements around retracting information if people have requested for that to happen. Ultimately, at the end of the day, that information services up through the various valuer generals. Once that sales, it becomes on the public record. But that said, we can still have reference to that information even if it's not publicly displayed. So in terms of agent advice, sales, getting the freshest, most recent transaction data is what gives you the most accurate estimate in market and whether it's an automated valuation method or whether it's a physical value going out inspecting the property. The most up to date data will give you the most recent reflection of what a property is worth, regardless of whether it's in a climbing static or falling market. Something that has just been transacted two days ago, for instance, at auction on the weekend, will give you the best test of market value of what someone's been prepared to pay based on all the relevant factors they've considered before making that decision to purchase a property.

Kylie Davis

What I'm really curious about too, and interested to hear is that knowledge is power and the knowledge making allowing you to make more confident decisions. When I was at NewsCorp as real estate editor of all News, we saw that really clearly during the GFC in markets that were auction markets versus markets that were private treaty markets, because auctions are basically at the time before you were getting weekly updates on what your property was worth. The auction market was basically telling Melbourne and Sydney how healthy their markets were or how slow they were. So when the tide turned and the markets slowed down, melbourne and Sydney sellers got very savvy very quickly about what they needed to do to sell. And that compared to Brisbane and Queensland markets, that the time on market just went completely out the window because they weren't getting that daily or that weekly data feed to tell them how weak their market was.

Kylie Davis

And so people were holding on saying, I'm not going to sell unless I get X. And so you saw days on market going up to here in some markets, it was really quite phenomenal. And I guess now, sort of many couple of decades later, the fact that you can get a weekly valuation or AVM on your property showing what happened this weekend means that private treaty or auction, you're getting regular feedback on what's going on locally.

Shelley Horton

Yeah, definitely. And I think it still holds true that different markets are better suited for another total to the different sale methods, but just those automated estimates of value. I guess one of the things sort of powering our model is just the scale at which we can compute all those different data points. And that technology has advanced over the last couple of years. So it makes it possible, just adding in new data points and refreshing regularly, it's quite overwhelming how much information and then resurfaced out to you at just an absolute instant. So that's really exciting. I think it's a great thing for consumers, ultimately, at the end of the day, the more people that can be educated before they make the biggest decision that they'll ever take, which is purchasing a property, I think makes for a good, strong housing system in terms of real estate, but also banking and finance.

Shelley Horton

People making sound decisions when they're potentially transacting large amounts of money. I think the banks rest much easier knowing that you've got a well educated buyer who has been part of that process. Totally.

Kylie Davis

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Kylie Davis

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Kylie Davis

So Shelley, tell us a little bit about your career. How did you end up at Propcheck?

Shelley Horton

Look, I've had a career that spans well in excess of 20 years and I started out originally as a property valuer and spent a good decade traipsing through, I'd say, tens of thousands of properties earlier on in my career. So that really sort of taught me the ropes around Valuing. I then went to work in the mortgage insurance sector. So the pointy end high LVR lending saw when things didn't go so well, when unfortunately, people couldn't repay their loan. And so worked with lenders then to make sure that were getting the best outcomes for borrowers that were suffering hardship if they had to dispose of that property. And then I took a slight deviation. So I'd always worked in B. Two b environments. And then in around 2014, I set up my own practice as a buyer's agent in Sydney. They're using that sort of valuation and corporate experience and was upfront and center with consumers then helping them make sound decisions when they were faced with making the biggest decision that you'll ever make, which is purchasing a property.

Shelley Horton

And so that really opened my eyes, to be honest. I still tell people, anyone who's interested in listening, I learned more about the property market as a buyer's agent than I ever did as a valuer. Getting much closer to what absolutely what drives people different behaviors, different personality types as to why people sort of push more and some are more conservative around their decision making, but also just understanding that process as a valuer, you can be somewhat removed and further back. And so just understanding a little bit more around that whole real estate transaction. And then at the same time as that, I was consulting to others in the industry using the valuation background. So sort of helped some banks set up their valuation operating procedures and strategies and then more recently have delved into the property data space, which I find really exciting. And that is really nice sort of culmination of the career to date and landed at Prop Track about twelve months ago.

Shelley Horton

So heading up their product function in essence, and developing our various suite of products that we sell to our external customers, our banking finance customers, but also the teams that help support some of those unparalleled data and insights that power the rea strategy as well.

Kylie Davis

So, apart from real estimate, what other products has proptrack now got in market or got coming up?

Shelley Horton

So we have desktop products, sort of combined data and value assisted assessments. So that's without going through a property, but providing an accurate remote assessment that supports the lending process. So we've got a valuation product platform and also valuation fulfillment. So we've developed a valuation ordering platform that facilitates that whole end to end valuation fulfillment process. So supports lenders executing on their strategy with regard to collateral assessment and valuation. So regardless of what valuation assessment type, whether it's an automated assessment, a remote assessment, or a physical onsite inspection of a property, we can facilitate that end to end process for lenders. And that's a scalable platform that effectively could be reused for different valuation use cases. We also focus on lead generation tools. So if you think about that end to end mortgage lifecycle, lenders are tasked with, or keenly focused on attracting the right customers to begin with.

Shelley Horton

So we provide products that provide targeted, engaging experiences. So property reports, digital property reports, that gives you an indication if you're a potential buyer or looking to refinance insights on your own property or a property that you might be looking to buy with information and metrics, potentially an estimate of value. And then as a lender is trying to nurture that customer and compete, we know how competitive it is in the mortgage space at the moment. So customers that are products that help support customers throughout that process. So it could be our API, our Data API products, so just information on particular data points that they might be interested in and then right through that entire process of capturing them and fulfilling the mortgage origination processes quickly. That's where evaluation products come in to make sure that the lenders can have a fast frictionless assessment process.

Shelley Horton

There's been huge inroads in the last couple of years around mortgage approvals and faster time TS and Digital mortgages, the valuation process hasn't necessarily kept pace with that. All our products are designed around instant or near instant decisioning, so kind of same day turnaround times that's helped facilitate that. And then once the loan is written, we support our customers with various products that I guess help them give insight on the performance of their portfolio. So property bureau and monitoring products. So updates on the valuation of the securities, changes to the property condition, different data and metrics that give you an insight in terms of the portfolio of properties that you've got under management as a lender and then the flight to refinance that is pretty prominent at the moment, with interest rates increasing at the rate they have. Again, digital engagement products for lenders touch base with their customers.

Shelley Horton

Lenders and mortgage brokers are a huge component of the industry at the moment, sort of underwriting about 70% of mortgages. So think about digital engagement or reasons to trigger a touch point with your customer, to keep in touch with them, just to check how they're going, if they're thinking about refinancing, if there might be a better deal. We can support lenders and mortgage brokers with different reports that might be suburb trends, might be property specific, but different engagement products that create stickiness for the customers to make sure they sort of stay on your books, particularly the good ones. Yeah, okay, whole bunch of those propensity models is something we've got as well. So that's sort of something, probably a more recent sort of product. And that is really around predicting the likelihood of a property to list, sell or refinance. And that spans across real estate.

Shelley Horton

So agents obviously want to understand where their next listing might come from. When a property lists, quite likely that owner or that borrower is going to then go on and purchase another property. That's of interest to real estate agents but also to lenders to follow that customer to their next property, whatever it might be. And then if somebody's thinking about refinancing, we're trying to serve up information to our customers that enables them to reach out to a customer before they jump ship to another lender and touch base with them and see whether they might be able to refinance or give them a better rate to keep them on their books. So that's really exciting. That's something that is really being fueled by, again, that unique data that we get from our rea platforms can't get elsewhere. And what we're doing is working through those models with our customers and proving it out what we think is likely to happen, proving it out against their own data.

Shelley Horton

And so that's how we typically work with our customers in partnership, proving out concepts, testing ideas and hypotheses and then scaling a product after that once we've proven that it does what we say it does.

Kylie Davis

Fantastic. In all of those cases, pretty much they're products that are B to B products. Again, they're not B to C but they're using that view that Realestate.com has of the consumer to feed that information back in.

Shelley Horton

Yes, the behavioral stuff, it's nothing sort of personal to anyone. Obviously we manage personal and private information in accordance with regulatory requirements but it's the insights that sort of suggest that an activity is going to happen that we use to surface up that. But absolutely it's those behaviors that we see and the data that gives us, I guess, an indication of someone's intent to take that next action.

Kylie Davis

So how does that benefit me as a consumer compared to say 1015 years ago if I was buying or selling? How does the fact that all of this is going on in the background now, sharing that, giving those insights to valuers and to the mortgage brokers and things or to mortgage industry. What is the impact for the consumer? How has that made it easier or better for a consumer?

Shelley Horton

I think the experience ultimately at the end of the day the consumer gets so if you've got your lender proactively reaching out to you because they don't want to lose you to another customer, I think that's a better consumer. We've all heard about lenders who may sort of sit back and not necessarily proactively reach out and happy to just keep rates going up. But if there's a better offer to be tabled there so I think a better outcome, better experience, I think choice if I think about there are other providers in market providing valuation and propensity models and products and APIs and so forth. So I think more choice in this space ultimately gives a better outcome for consumers and also for B, two B customers for the lenders. There hasn't been a lot of choice the last couple of decades. So that to me keeps everybody on their toes, it keeps you innovating, delivering new experiences and new products that are different to what else has been in market.

Shelley Horton

And then that's certainly our sort of approach to differentiate to prove that we can provide customers with good outcomes but do it differently and do it more smartly. And I think ultimately the consumer at the end of this, the more information they're given to inform their decision making, whether it be around purchasing a property, whether it be around selling a property or refinancing a property, it's a better outcome for them. There's nothing worse than somebody and I found this from my time acting as a buyer's agent there's nothing worse than seeing a client fret over the decision they're about to make. Sort of it gives you an indication that they don't have enough information to be able to maybe take that step forward. And so there's more to be done to give them that confidence before they make that step, that they've got all the information that they need to confidently make that next step.

Shelley Horton

And whether it doesn't have to be just about buying a property, I mean, that's probably the largest thing. But even just knowing that you've got the best rate, that you've got the best offer in market, if you're refinancing having people reach out to you rather than you have to go and do all the looking, I think that can sort of help as well. In terms of just a better experience for a consumer, there's been more choice. I think there's more choice than ever across the entire real estate and mortgage and finance space there has been in a long time and I think that's a good thing.

Kylie Davis

I guess everything's transacting faster now too because the risk is known, because the data sets are now actually helping the back end functions understand the level of risk involved and pricing that in properly.

Shelley Horton

Right yeah, I think that's a really good point. I think step back a decade, even a decade ago, the lag in terms of servicing up information so properties would sell, you typically wouldn't have the information. It was kept in the hands of businesses and professionals and the consumer had to sort of fight it out and try and find that information. Now more information than ever is available for them, free of charge, for them to sort of make that sort of inform their decision making process. And so I think even with that, to your point, if something sells on the weekend, sure, you might get some sales that are sort of you might get requested to not disclose the purchase price, but usually in an open home or something like that, you'll still be able to get that intel from an agent. So I think that helps in terms of it is the most up to date information available.

Shelley Horton

And I think just the scale of technology and the involvement of technology in the last decade has helped enable that. Early on in my career, were waiting for CDs to be probably age a little bit, but you'd wait and so you'd have your data a month in arrears before you that was really.

Kylie Davis

Up to date, right? Because it was on a CD.

Shelley Horton

Yeah. Even now, nationally, you've got different requirements in different states. So New South Wales typically standard settlement period is 42 days. Obviously, people can negotiate different outcomes. In some states, I think Victoria is 30, 60, and 90 days. So you're waiting for that information to be relayed and transferred through the VG. You're already three months behind knowing because you've got to look at that settle. But an agent advised sale on our platform gives you that insight that we kind of know in three months or in 42 days or whatever that relevant period is that's going to be the outcome. So the freshness of that data is really important, I think, to inform consumers. And that's been one of the best. I think the speeding up of making that information available has been one of the hugest advancements and positive features that consumers have benefited from in the last.

Kylie Davis

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Kylie Davis

And so, look, I'm curious to understand, is Proptrack a completely separate division, or is it just part of is it a subset? How's it structured in rea?