Disruption—it’s a buzz term applied to the tendency of technology to radically change an industry. In the context in which it’s usually used, disruption spells doom for that particular field. Some have pointed to real estate as the next industry to come under fire from technology—recent data even suggested that 82% of real estate jobs are at risk of disappearing by 2040, compared to 44% of jobs generally.
With those kinds of statistics being thrown around, you’d expect some agents to be cowering under the covers with a hot water bottle and a cup of tea—but that isn’t the case.
Independent Property Group agent Jonathan Warren says “Disruption is only a bad thing when the change isn’t welcome—when it’s not good for business. There has never been a better time to be an agent. Technology is supporting our role in exciting ways.”
So what are some of the ways technology is adding value to the work of your local real estate agent?
There are plenty of benefits to working with an agent rather than trying to go solo. By far the biggest is the bank of potential buyers that agents have ready for your home before you even list it—to the extent that sometimes marketing is unnecessary because the agent already has the perfect buyer for your property.
Previously this pool of potential buyers was created solely through registrations of interest; these days agents are extending their reach through social media. The Independent Property Group Facebook page has more than 11,000 followers and individual agents also have their own pages. These form a perfect platform to engage with buyers across Canberra—people who have connected with agents online because they are actively considering buying and selling property.
Warren says, “The 440 people, mostly from my area of Canberra, that like my agent page are a great addition to the pool of buyers that I already have from my personal database. I’m able to engage with them using video and photos, which they really like.”
Another piece of technology bringing agents and buyers together is Home Pass—an app designed to link agents with their domain.com property listings. Potential buyers are able to register for an inspection online and agents are able to contact those registrants with updates regarding the property. This concept isn’t new—agents always collected the details of open home visitors—but it does make it so much easier and time efficient to keep in contact.
Part of the agent’s role is to help educate buyers and vendors on changes in the market and issues relating to real estate that may affect them. While the trusty old quarterly newsletter is still around (for the moment) agents are turning to blogs like Perspective to share high quality information. With an email distribution list of over 1,100 people that have signed up for Canberra real estate updates, as well as a strong social media audience when shared on the Independent Property Group Facebook page (48,000 people reached in the past 8 months), agents are better able to share their knowledge so their clients are able to achieve better results.
Live streaming of auctions
Jonathan live-streamed his first auction a fortnight ago on domain.com. The auction received over 9400 views and over 74 comments.
“I’ve had a lot of great feedback from potential vendors and past clients about my Friendly Auction Campaigns and how great it is to be able to watch these auctions live. It shows the real hustle and bustle that actually happens at an auction. Not only does it benefit our buyers, it’s turning into a job interview for potential sellers in the future.
“The real benefit of streaming auctions, particularly given they can be watched after the event, is that buyers researching an area can only make it to two or three auctions in person, but if they can then go home and watch another three auctions in the evening their market knowledge is that much stronger.”
Several technologies have come together to make actual live auctions an imminent possibility, where people can bid for a property from anywhere that has internet access. Through a mobile app—like eAuctions, which is currently in development—buyers will register for the auction, watch the auction in real time and be able to place bids through their mobile device. It’s a more sophisticated version of bidding over the phone.
Live auctions have been embraced by auction houses selling everything from fine art to wine to collectables for several years now, and the industry has seen a massive uptick in prices and overall sales ever since. Live auctions allow for a significantly improved buyer pool.
“A completely live auction will happen. It’s the future and I’m really excited about it. Streaming live was great, I can’t wait to do another one, but having people bidding online will be a whole other game.”
eBay for real estate?
Australian company Bid Rhino is also looking to get its foot in the market with its ebay-like system for bidding on houses. Vendors list their property and choose how long an auction goes over—perhaps a week, perhaps two.
“This is one tech development that I don’t see taking off at all,” says Warren. “Firstly I don’t know how many people would be interested in a long bidding process. You’d sign a legally binding contract to start bidding and then for a whole week or so you couldn’t bid on any other homes at a regular auction in case you won both.
“There may be a couple of sellers doing this but most people realise hiring an agent to help sell your home is critical. Yes it may cost a little more but the value and return we achieve by interacting with buyers, building relationships and going on that emotional journey with them outweighs agent fees. No website can do that.”
Any who’s done the house hunting thing knows the decisions that need to be made. When there are several properties showing at the same time, and twenty minute drives between properties, something needs to give. Some homes need to be relinquished without being seen.
The introduction of live streaming apps like Skype and Periscope allows for potential buyers to view properties from overseas, interstate, or from the office if getting away from work it too difficult. A husband could be at one property filming, the wife at another.
Ultimately, you want to see a house in person before you buy. Video is all well and good, but nothing will match being able to look close up, to knock on the walls, open the oven, run a hand over the paint work. What streaming beforehand does is allow you to separate the chaff from the wheat—to narrow down your choices so that you can make appointments to go visit the properties that already know look promising.
Disruption, if you can call it that, first came to the real estate industry with the introduction of realestate.com and allhomes.com. No longer was it necessary to pound the pavement going from agency to agency looking for listings. Nor is it necessary for a buyer to list their property in the weekend paper, although there are certainly advantages to doing so. Instead the vast majority of properties are listed on websites, available at a click through a search engine.
The second wave of property marketing change is about to hit—already agents are creating webbooks or mini websites for properties, with detailed information about the property, plenty of photos and inspection/auction details. The next step is the integration of virtual reality apps, 3D floorplans, drone footage etc.
“Off-the-plan developments are already dipping their toes into this kind of market, with 3D tours available of apartments that don’t even exist yet. As the technology becomes more common and cheaper, we’ll see this move into established homes.”
Why we’ll always have real estate agents
Despite the doomsday theorists, there are always going to be real estate agents. In fact in the US, typically Ground Zero for disruption, the percentage of buyers purchasing through a real estate or broker has increased to 87% in 2016 from 69% in 2001.
The reality is an algorithm will never replace an actual person. An algorithm can spit out the basics-this customer wants 3 bedrooms near a particular school—but will never be able to determine if a property has that ‘feeling’ that an owner is after—a blend of light and space and design. An agent knows these things, and when a property with that sense is listed with him, he knows who to call.
The ultimate goal is the best price as fast as possible—and technology is helping agents achieve that.