Meet 7 PropTechs Transforming the Latin American Real Estate Market

June 30, 2022
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The way that people buy, sell and rent homes is changing fastest in developing markets. Innovative real estate marketplaces are thriving in places where agents aren't as organised or powerful, markets are informal and bureaucratic and where consumer behaviour isn't yet set in stone.

Latin America is seeing a boom in non-traditional real estate marketplaces and a surge in investor capital to back them. The idea of renting a home directly from a portal might be farfetched to a tenant in Ireland but in Brazil, it's become commonplace. The idea of paying for a house in cryptocurrency might be laughable for home seekers in New Zealand, but it has become a reality in Mexico.

These are some of the companies changing real estate in Latin America...

Quinto Andar

What is Quinto Andar's Business model? It acts as an end-to-end brokerage for home seekers and takes a one-month brokerage fee. Quinto Andar also charges landlords between 8.5% and 9% and one month's rent. It also offers to sell users' homes charging owners a 6.5% brokerage fee to take care of everything they need.

What is Quinto Andar's Backstory? From the start, Quinto Andar has taken advantage of a fragmented and bureaucratic system and used interesting tactics to gain inventory. The company offers referral fees to anyone that refers a potential listing to them and had success paying these fees to janitors and guards at apartment complexes in the early days.

Quinto Andar soon caught the attention of investors and has raised over three quarter of a billion dollars from some big-name investors. When the company last raised funds in August 2021, it did so at an enormous $5.1 billion valuation (about the same as Rightmove at the time).

Since then the giant from Sao Paulo has been busy not only disrupting traditional players but buying them out to fuel its expansion as well. It bought out the real estate portals of leading Latin American classifieds player Navent in December 2021. If the recent launch in Mexico of Benvi is anything to go by, it seems that Quinto Andar is going to use Navent's well-established, traditional network of portals to expand its revolutionary rentals model across the region.

How many listings does Quinto Andar have?  We estimate that Quinto Andar has around 25,000 rental listings on its main Brazilian site. There are more sales listings, but these include listings that have been syndicated from Imovelweb - the traditional Brazilian portal run by Navent.

 

Loft

What is Loft's Business model? It buys, renovates and sells real estate. Loft also has three different ways to allow users to sell their apartments (they can place ads on its marketplace, do an apartment swap or sell directly to Loft which acts as an iBuyer).

Loft makes a fee of up to 6% of the sale value of the property. This cost includes legal advice, exclusivity, online management of visits and proposals as well as brokerage fees from real estate partners

What is Loft's Backstory? The founder, Florian Hagenbuch had previously founded a successful e-commerce business (PRINTI) which made its early investors a lot of money. His new venture came at a time when iBuying was new and exciting and VC capital quickly began to flow to Loft.

Loft's early challenge was to build up a pool of quality data and as it did this it was able to offer its services in more neighbourhoods. In 2020 the company saw a rapid expansion of its business driven by a staggering increase in its inventory as user behaviour changed with the pandemic.

Loft has accumulated around $800 million VC dollars in a short space of time and has not exactly been laser-focused with its acquisitions. The company seems to want to become a one-stop-shop for real estate in the Brazilian market...

  • In 2019 Loft acquired renovations company Decorati which was subsequently, eventually shut down.
  • In 2021 Loft acquired CrediHome, a provider of bureaucracy-free credit solutions for home buyers.
  • In 2021 Loft acquired 123i, a traditional challenger portal.
  • Loft expanded to Mexico with the purchase of TrueHome in 2021.

After securing $100 million as recently as April at a valuation north of $2.2 billion, there is speculation that Loft is planning something big to gain market share.

How many listings does Loft have? At the time of writing, Loft had around 60,000 verified and de-duplicated listings on its platform across its four major city markets in Brazil.

 

Houm

What is Houm's Business model? For sellers, Houm acts as an online brokerage and takes a commission of the ultimate sale price (2% CL, 4% MX, 3% CO). For landlords, it acts as a rental agency and takes 50% of the first month's rent and between 0% and 7.5% commission from then on depending on the package selected.

What is Houm's Backstory? No doubt inspired by the success of the likes of Quinto Andar, Houm was founded essentially as an online brokerage for both sales and rentals. Much like its European counterpart Spotahome, Houm employs a team of employees to pre-inspect properties and take listings photos and videos at no cost to the owner/landlord.

The company's expansion from a startup to an employer of some 500 workers (according to Linkedin) has been fuelled by investment from the likes of Fifth Wall and Goodwater Capital with the company raising three separate rounds in 2021 alone according to Crunchbase.

Like a lot of companies on this list, Houm expanded to Mexico City recently and is also operational in Colombia.

How many listings does Houm have? Having looked at the company's platforms across its three markets, we estimate that Houm has 300+ listings in Chile, 500+ in Colombia and 500+ in Mexico.

 

Of all the platforms featured, only one of them has truly exclusive listings - most use other assets or partnerships to get visibility...

 

AoCubo

What is AoCubo's Business model? AoCubo calls itself an 'iBroker'. It captures, qualifies and matches buyer leads for primary real estate with the right third-party agents in its network. For this and intermediating the transaction, it earns a commission. AoCubo also originates mortgages and offers fintech solutions to its users.

AoCubo's founder, Ronnie Sang explains his company's model to Simon Baker...

What is AoCubo's Backstory? The company is all about the 'Uberisation' of leads. In 2017, Ronnie Sang saw an opportunity to qualify and distribute leads for primary real estate developers in Brazil - much like Uber distributes rides to its drivers.

The company learned early on that WhatsApp was the best way to interact with all the agents in its network and decided to build out a supplementary 'iBroker' app to work in tandem with WhatsApp and help agents with the leads being generated.

In the last two years or so, AoCubo has brought in an experienced COO from Loft, raised fresh funding and partnered with Uruguayan portal InfoCasas.

How many listings does AoCubo have? One of the more secretive platforms on this list in terms of disclosing its inventory, in our research, we read that AoCubo had around 70,000 listings across its new-build network (roughly 90% market coverage) back in August of 2021.

 

La Haus

What is La Haus' Business model? Simply put, La Haus sells primary real estate and takes a share of the commission. It also lets users sell their homes by listing them with La Haus on their portal.

La Haus users can also invest in property using Bitcoin and the platform has an innovative model that divides the rights to a property into fractions and allows users to buy and sell them as NFTs with the company taking a percentage of these transactions. In Mexico, La Haus also offers a mortgage brokerage service.

What is La Haus' Backstory? Two of La Haus' founders met at Stanford University and before they launched the startup they founded a successful VC firm (Jaguar Capital).

The profile of the founders and the opportunity on the table have been enough to make the company the trendiest startup in Latin America in terms of its investor profile. Cofounders of VivaReal, Trulia, Zillow and Mercado Libre are joined by none other than Jeff Bezos in their backing of La Haus.

Having begun its journey in 2017 in Colombia, La Haus was confident enough four years later to claim to be the market leader in selling new housing in Spanish speaking Latin America and the leading brokerage in Mexico City.

La Haus has continued to make headlines with the company having facilitated a real estate transaction in Bitcoin and signed a research agreement with MIT in recent months.

How many listings does La Haus have? La Haus has around 20,000 listings in its native Colombia and around 25,000 in Mexico.

 

All seven companies are on different stages of their startup journeys, but they're all changing their respective housing markets...

Habi

What is Habi's Business model? Habi is a classic iBuyer. It offers sellers a quick way to get the liquidity they need by offering to buy their houses based on a valuation from its AVM before renovating and selling the home at a profit. The company also offers its users an end-to-end buyer concierge service which includes discovery, viewing, mortgage brokerage and online paperwork.

Habi also owns two Mexican real estate portals that generate revenue from charging agents to list on them.

What is Habi's Backstory? Another Colombian PropTech that expanded to Mexico soon after being founded and another with a founder who studied at distinguished American universities (cofounder Brynne McNulty Rojas studied at Harvard Business School) - Habi is another member of the cohort of PropTechs bringing in VC money from the United States to transform the housing markets it works in.

Habi made a couple of interesting acquisitions earlier this year when it chose to buy up the Mexican challenger portal Propiedades.com along with full-service end-to-end search and transaction platform, TuCantón.com. The move may have been partly opportunistic but having more inventory, more data and a larger presence at the top of the funnel is a road that many next-generation real estate marketplaces have started to go down.

How many listings does Habi have? In terms of the iBuying stock Habi is marketing, the numbers when we looked were around 550 homes in Colombia and 175 between its four regional markets in Mexico. Obviously, the two Mexican portals Habi owns have many more third-party listings on them as well.

 

Aptuno

What is Aptuno's Business model? Aptuno is an end-to-end rental marketplace broadly similar to Quinto Andar. Aptuno acts as a rental agent with landlords paying between 8-10% of rent plus either 50-100% of the first month's rent. For this, the company screens tenants, takes care of the contract and payment (as well as payment guarantee) and does all the property management.

Since January, Aptuno has been offering vacancy loans and rent advance loans to landlords as well. Agents can earn commission by referring landlords to Aptuno and from listing on their platform.

What is Aptuno's Backstory? You guessed it... a Colombian startup that was founded shortly before the pandemic which has expanded to Mexico with some success. Aptuno expanded to Mexico in 2021 with cofounder and CEO Alejandro Gomez de Greiff telling us that Colombian PropTechs see Mexico as an attractive market because of the higher GDP per capita, massive scale and very similar culture to Colombia.

Aptuno has been growing fast. The company closed 900 transactions in 2021, a figure which represents 11 times the number of transactions closed the previous year and the company will be hoping that it is firmly established enough in the Mexican market to fend off the entrance of Quinto Andar's Benvi offering.

How many listings does Aptuno have? When we looked, Aptuno had around 1,900 listings in Colombia and around 450 in Mexico.

 

There are many more innovative Latin American real estate marketplace businesses out there transforming their markets. Homie and Pulppo in Mexico in particular deserve a mention on this list.

June 30, 2022
Edmund got to know the world of portals and marketplaces working at Mitula Group (which became Lifull Connect after the buyout in 2018). He worked directly with hundreds of portals across the world in his role in the content department for three and a half years before transferring to the SEO department to understand the inner workings of listings sites. He joined Online Marketplaces as Head of Content in March 2020.

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