Ryan Castle, CEO of the Cape Cod & Islands Association of REALTORS® and the Cape Cod & Islands Multiple Listing Service, came to our First Friday Breakfast meeting to tell us about how technology is changing the business of real estate.
Platform companies like Uber and Airbnb which don’t own the products they sell have been a disruptive force on the marketplace recently, but Realtors have followed that model forever. The question Castle raised is how do Realtors stay relevant in a digital economy.
Disruptive technology that’s changed real estate transactions include services from Zillow to Quicken Loans. To stay involved in the transaction, Realtors need to use these technologies to their (and the buyers) advantage.
Eleven years ago Zillow launched a service that showed real estate listings online. It provides buyers with a first look, while creating a lead for Realtors. Castle said that Zillow is about 18% off on its estimate and has limited information – information that can be found in the MLS. Castle also demonstrated how AI devices can help their members do business, asking Alexa to search for real estate and send an email with a comparative market analysis.
Another new technology is Matterport, which shows homes in 3D. It’s not appropriate for all properties, but could replace an initial showing in some cases. There are vendors who photograph the homes, and others who use drones to show property. These technologies are most likely to be used for properties listed for over a million dollars. (Explore in 3D)
Castle isn’t sure where virtual reality is going, but it may include holoportation:
Car dealers expect people to do their homework online and realtors are finding that home buyers are also doing their own research. A Realtor is not going to bring you the house, you’re going to bring the house to the Realtor who will then walk you through the purchasing process. Castle noted that Realtors used to help clients in the most exciting stage, but now deal at the most anxious times – making an offer, inspection, and closing. Those touch points are where realtors can be especially helpful. Realtors don’t control the process anymore – power is in control of the consumer.
The consumer has benefited from technology, but sellers still work with agents. “For Sale by Owners” are down, Castle said. 80% of deals in the country are through an agent. One way for agents to stay central to the transaction is to embrace the technology and find ways to make the process easier on the consumer. All the information is everywhere, but it’s not tied together.
Agents also need to be up on smart home technology so they can talk to the buyer about homes that have it, and be able to clear the data and reset it for a new owner. Some buyers don’t know about the systems and Realtors can help them understand what they have.
Even with so many changes in the industry, Castle says membership is at an all time high for the Cape Cod & Islands Association of REALTORS®. “A lot of our members are in their second occupation,” he said. “It requires that you’re prepared to have no income for two years, so it’s perfect for people who are retiring to the Cape.”
“We are a Supreme Court ruling away from independent contractor status,” he said. “We keep an eye on what’s happening to Uber because it’s not that different. As they test independent contractor status in courts, we’re monitoring that.”
With technological changes in the industry, Realtors are distinguishing themselves by their level of service and use of available information. Can it get so good that it’s all done online? Is Airbnb the future for real estate? It may not be long before someone pulls it all together and cracks the code.