It's big data, not the big bang

The spring of 2015 is busier than ever.
From a financial perspective, we’ve had a lot to celebrate. With record low mortgage rates, a forecast pick-up in housing transactions, and an eagerness among lenders to grow their businesses, the recession is gradually fading
into a distant memory. The time is ripe for conveyancers to pause, survey the scenery, and contemplate how their business and future marketplace will fare.

The average number of transaction volumes hit
a ten-year high in 2014, and despite conveyancing activity falling nearly a quarter (23 per cent) short of the peak period of 2007, we’re a long way on from that dreadful trough when the market was fuelled by little more than a grim baseline of debt, divorce, and death.

The impact of the recession has, however, left
an indelible mark on today’s marketplace, with conveyancers having borne the brunt of market volatility. Some 1,862 firms have exited the
market or merged with competitors since 2007, leaving 5,871 firms surviving in the market at the end of 2014.

The ‘Conveyancing Market Tracker’, a report on conveyancing trends over the last decade, has also revealed certain interesting patterns defining the behaviour of a post-recession market. Economic recovery has whipped up the market to be more Darwinian, with competition intensifying as firms drop out and those left behind clamour for the spoils. Seven conveyancing firms completed more than 500 transactions a month last year, compared to only four that managed to do so in 2007 and just one in 2005. Collectively, the 200 biggest firms achieved a 36 per cent market share last year, an increase of just over a third from 26 per cent in 2007.

The businesses that survived the recession are
in a position to reap the benefits of growing transactions and, although much of the growth
in volumes has shifted to larger firms, small firms are just as capable of leveraging their unique competitive edge to gain traction this year.

The market cooled a little over winter, driven partly by the introduction of stricter lending criteria and tougher mortgage rules last year, as well as the uncertainty over the consequences of the general election. Volumes, although forecast to rise, will probably not grow at 2014 rates. However, lenders will certainly be keen to flaunt competitive rates in order to meet their sales targets for 2015. Despite the mansion tax scare and a depressed top end of the market, property and housing forecasters remain generally optimistic that activity will now pick up following the election, so there are ample reasons for conveyancing firms, big or small, to gear up for increased momentum.

According to conveyancers surveyed by Search Acumen, two-thirds (60 per cent) of firms identified the need to improve systems and processes as the biggest hurdles they will face in order to grow volumes. Conveyancers will need to integrate better systems and processes into their roadmaps to acquire a greater share of transactions as housing activity picks up. There also needs to be
a long-term strategy in place in the form of a reassessment of how conveyancers see their businesses in the next five, ten, or even 20 years.

Unstable practice area

For many multi-disciplinary firms, conveyancing has been a small, but highly volatile part of their practice. It is often overlooked – in terms of business attention and investment – in favour
of the more glamorous aspects of the law, often compromising the quality conveyancing service that clients deserve.

Size won’t matter as much in the conveyancing of the future, as technology will level the playing field; in fact, futurologists argue that it’s not even technology that will make the difference in the future as it is already the staple for many law firms that have sophisticated customer relationship management (CRM) and legal management systems in place. Others have also harnessed cloud technology and have powerful email encryption software to leverage the capabilities of user-generated content websites and social media, i.e. web 2.0. So, the battleground for a piece of the pie from 2015 onwards will not really be technology.
It will be all about ‘big data’, and the ability to smartly apply it to housing transactions.

Generically, big data is a popular term used to describe the exponential growth and availability
of data, both structured and unstructured. In this decade, big data will be as important to business – and society – as the internet has become. Why? More data may lead to more accurate analyses. More accurate analyses may lead to more confident decision making. And better decisions can mean greater operational efficiencies, cost reductions, and reduced risk.

Breaking industry silos

Traditionally, property transactions have been processed by, in turn, estate agents, lenders, surveyors, and conveyancers, securely cocooned in their operational silos, driven by different business models and process objectives. This is disjointed, dysfunctional, and opaque. The future, however, is going to be much more transparent, with big data acting as the biggest driver towards more open, efficient, and faster processes. 

Think of the property transaction of the future, flowing smoothly through a glass pipe, rather
than being thrown blind from silo to silo, like a hot potato. The ability to manipulate data to make life easier for consumers will also give birth to a whole new range of business models. Luddites may have reason to fear, but ultimately the future will be built on an ideal of a more transparent and cohesive property transaction, even if that involves disruption and confronting vested interests along the way.

The power and pervasiveness of existing
vested interests in keeping the process the way it
is has held back the tide of change in our industry, while many other consumer services have been transformed. Many would accuse me of wistful idealism; these may be ‘ivory tower’ rantings about big data as evidence of the inevitability of change in an industry that is heavily self-interested in leaving things as they are, but idealism is important and creates an aspiration that the property market can aim for, by equipping conveyancers with the ability to make incremental process improvements.

No one is suggesting a radical overhaul of processes. The industry will be transformed over time by the aggregation of these incremental changes in the same way that other consumer services have been transformed, and applying big data to the process will be the catalyst for this long-awaited transformation.

Data-driven sector

Within conveyancing, it is up to service providers to innovate with big data, harness greater
and more flexible access to data, and create
new products and services for conveyancers.
At Search Acumen, for example, we are working hard to develop just such new products and services, such as greater and more flexible
access to Land Registry data. We applaud the
Land Registry’s approach – making their data available to innovators – which is encouraging improvement in the process through data. Watch this space: the ultimate goal is to make searches, and conveyancing as a whole, a lot less stressful
for consumers, through greater efficiency, transparency, and certainty. There is no reason why this is not possible in such a heavily data-driven industry.

Big data is making a whole new range of products possible to make life easier for conveyancers. Land Registry and forward-thinking private firms are already spearheading the change. For example, plans to centralise and digitise the local land charges register will improve data access, standardise fees, and achieve faster turnaround times.

Now, we’re seeing other authorities, beyond
the local authorities, modernising and making available whole new sets of data to transform conveyancing in the future. Silos haven’t broken down but we’re gradually beginning to see cracks materialise. This, in turn, has created a whole new set of possibilities for better products and processes.

We, for example, have launched Title Intelligence, a digital reference tool that helps conveyancers validate a property’s location.
Using a live data feed to display property boundaries on-screen adds no time at all to the ordering process but it can save a huge headache by validating spatial details and confirming that everything is in order with each search request.

These incremental innovations are rendered possible by greater flexibility and better access
to property data. We aspire towards an ideal conveyancing process – not yet fully defined but more transparent, efficient, and certain. And it is not only the process that will be transformed but also the dynamics of the relationships between conveyancers and others. I foresee a bright future for conveyancers if they seize the big data opportunity. SJ

Mark Riddick is chairman of Search Acumen