South African digital rental management platform HouseME is seeing 30 per cent month-on-month growth as it expands from the Western Cape to other parts of the country.
Formed in 2015 and available to the public by the end of last year, HouseME connects prospective tenants to landlords and facilitates transparent bidding for fair pricing of rentals.
It then collects, manages and guarantees all rental payments and deposits. Chief executive officer (CEO) Ben Shaw told Disrupt Africa that uptake has been “phenomenal”, and that HouseME was expanding its user base nationwide in spite of all its advertising spend focusing on the Western Cape.
“Already half of our clients are located elsewhere. Our month-on-month growth speaks to how quickly we’ve gained traction, and we average a bidding upside of nine per cent – which is great ammunition to use against archaic property players who believe that they know the market better than a tech startup,” Shaw said.
HouseMe, in fact, has just under 1,400 landlord clients already, with Shaw saying its 2.5 per cent monthly pricing model showcased exactly the type of efficiency technology brings to traditional industries, for a fraction of the cost.
“HouseME offers security to both tenants and landlords by eliminating counter-party risk and reducing points of contact to one, single platform,” he said.
It was the pricing inefficiencies in residential rental that prompted the launch of the startup.
“Neither agents nor landlords have an accurate view of exactly what a property is worth to a tenant – only the tenant knows that,” Shaw said. “As such, HouseME originally started out as an rental auction platform, and it still offers a transparent bidding mechanism to this day. “
However, the founders quickly identified that within the current renting process there were multiple pain points that technology could solve. Now, HouseME offers free tenant screening, maintenance services, a lease agreement, a rental guarantee, deposit management, inspections and viewings – bringing it far closer to traditional competition.
“Agencies and DIY landlords compete with HouseME but could equally be served as clients. Already a few copycat products have sprung up, but none with the technology that HouseME boasts,” Shaw said.
Having raised angel funding in August 2015 and September 2016, HouseME completed a seed round in January, and has just had its official launch in July. Shaw said he anticipates a launch in Kwa-Zulu Natal soon too.
“Landlords really appreciate the fact that finally a business is incentivised to get them the fair price – not simply the first offer,” he said.
“We have had stiff kickback from property players who are earning ludicrous profit off of clients and wish to retain the status quo. We also have had to educate some clients as to what they will get from us for our fee – some believe it is too good to be true.”