VR boosts real estate sales for HK VResidence startup

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Palapple, a well-established IT company in Hong Kong, is having great success with its VResidence startup project. The company is using virtual reality (VR) technology to sell pre-owned properties.

“Everybody is talking about virtual reality…making a VR headset, making VR controls, [and] making it more advanced. The thing is, we have to put it into action and fit [virtual reality] into normal life,” Peter Choi, the Director of Palapple told Technode.

This is exactly what his company has done. The company’s VResidence project, started in December 2015 features an online platform for pre-owned property where realtors can show VR tours of pre-owned apartments. Palapple took the strategic decision to not focus on new developments, an important differentiator in China where many estate agencies focus on newly-built developments.

There has been a record plunge in the sale of new homes in Hong Kong in recent months. According to the National Bureau of Statistics of China (NBS), as of November 2015, 441 million square meters of the gross floor area (GFA) of new homes is finished but unsold. Developers are also launching fewer new developments.

Palapple uses third-party logistics companies to go out to properties to take panoramic pictures of properties, which are then transferred to Palapple’s server and turned into a virtual reality format. Palapple provides logistics companies with one week’s training and a panoramic camera, such as a Ricoh THETA S. Once an estate agent makes a sale or closes a rental agreement, Palapple receives 5% of the real estate agent’s commission, part of which goes to the logistics company, Choi explained to Technode.

The point of the VR tours is to help clients quickly identify property that they might be interested in buying or renting. VR tours of existing property can be done in a short time using panoramic photography, speeding up the whole process. New properties on the other hand, requires VR rendering and modeling of unfinished buildings, necessitating considerable financial investment. By focusing on used properties, Palapple can limit its investment in technical development, while maximizing its ability to scale in China’s real estate market.

Mr. Choi’s point is that clients still need to go and view the physical property before making any decision. VR tours merely serve to sift through the options a lot quicker. This is a practical down-to-earth approach to VR where VR is used to serve business objectives.

In addition to Palapple’s platform, where users can view property through Palapple’s VR app, the company also has its own headset. Palapple’s VR app is also compatible with other headsets. The company plans to sell its headsets to real estate agencies,

Palapple was founded by Peter Choi in November 2006. The company provides comprehensive IT solutions to corporates. He is also the founder of Snapshock, the app that lets people post photos live on the internet. He founded VResidence as a startup in December last year and has plans to expand the VResidence services to China.