Why The Biggest Threat To Property Deals In The Cost-Of-Living Crisis Isn’t Interest Rates: It’s Cyber Threats
As digital transformation impacts all industries, cyber criminals are plying their trade against businesses across the board, especially those who underestimate how technology underpins their business.
The property industry is often focussed on market, mortgages, and interest rates but one risk factor that is making every building vulnerable to a ‘break in’ is cybersecurity. Digital transformation has empowered business and the companies that are less inclined to think about technology underpinning their operations are often the most vulnerable to threats.
Think about the myriad stakeholders involved in any property deal – from solicitors to conveyancers, from everyday homeowners to commercial investors. The responsibility of a real estate agent is now that of a hub for sensitive information – and the need to avoid the risk of disruption to any costly deal – is enormous. In 2023, post-pandemic and in the midst of a cost-of-living crisis, the biggest risk to a property deal isn’t necessarily mortgage interest rates: it’s cyber security.
Almost any business is at risk of cyber security breaches, but real estate professionals are at an increased risk. Data hackers would love access to sensitive information such as finances, national insurance numbers, and contact information collected by estate agents. A significant data breach for an agent can be devastating for the myriad of stakeholders involved in any property deal, not just their own business. It’s well known that house buying is not only one of the most expensive purchases but also one of the most stressful – imagine not only having your data compromised in the process but also your cash. A 2022 IBM report estimated the average cost of data leaks at a staggering $4.35 million. A robust security posture will not only protect all parties but add another layer of trust to the transaction.
Dave Adamson, CTO at Espria, contends that if large companies are vulnerable to cyber-attacks, how much more susceptible are small businesses, such as independent agents, with weak, or weaker cyber-security?
“It has become increasingly common for sophisticated cybercrime to effect property industry businesses. As a result, any company in the sector is at greater risk of being targeted by cybercriminals than ever before, which should be a significant concern for them. With the most valuable asset in your life, there is a substantial amount of trust placed in estate agents when buying or selling a house.”
Adamson also believes the property management industry is not immune to this phenomenon.
“There is a common expectation that when a vendor opts to have their property sold by an agent, or even when a potential buyer inquires online, the agent will handle that safely. Their brand is associated with that level of trust.”
Adamson concluded, “recent security breaches at Switzerland-based Neho, a real estate agency, exposed sensitive client information that bad actors could exploit. Real estate professionals must implement robust cybersecurity measures to protect their clients’ sensitive information. Real estate professionals can minimise their immediate risk of a cybersecurity breach by using strong passwords, setting up two-factor authentication, using secure email and file storage services, keeping software up-to-date, educating employees, and preparing an incident response plan, but should they have greater concerns then a rigorous overview of their security posture, would be recommended”.