Over the last two decades, technology has had a profound effect on the way real estate information is analyzed and disseminated. But while the information delivery vehicle has changed—with the exception of the real estate contract, which contains additional legal provisions designed to protect buyers and sellers—the basic real estate transaction has not. Someone wants to buy residential or commercial real estate, and someone wants to sell it. The real estate agent or broker’s job is to facilitate that transaction for the side of the fence they represent.
In the future, the services that real estate professionals provide won’t change much from what they’ve been doing all along. However, innovations in software, web design and mobile applications will need to make real estate agents and brokers more timely, effective and efficient in performing those duties.
Their tech-savvy customers demand it, and those who can’t deliver fast enough will be left behind.
The New ToolboxSimply having an online presence is no longer enough, says Victor Lund, a founding partner of the WAV Group Consulting, in Arroyo Grande, Calif., which consults the real estate industry on technology and other business issues.
“The agent’s or broker’s website isn’t as important anymore,” says Lund. “It’s the business apps that agents use that are more important today.”
Apps that provide everything from digital signature solutions to normalized forms and paperless transactions are becoming the norm in the industry.
“Agents are starting to use their phone as a client servicing tool,” Lund says. “They can send a listing right from the cellphone. Consumers can pull up VoicePad and they can hear about the home.”
Similarly, interactive digital presentations allow Realtors to show photos and virtual tours of properties on their laptops and mobile devices. Through the use of listing syndications such as ListHub, Realtors need only to upload their listings once in order to distribute them to various websites, within a matter of minutes. And when there’s an update, potential buyers are notified in real time.
Realtors can organize and interact with both present and future customers with the numerous customer relationship management (CRM) platforms on the market.
“The key thing for Realtors to understand is that today’s consumers may start going online two years before they ever do a real estate transaction,” says John Pinto, broker/owner of Realty World/John V. Pinto & Associates in Napa, Calif. “You need a good CRM so you can segment your database and send messages that resonate with those different groups. “That a
lso goes for your social networking, too. Engage your public early on in the transaction so that you’re setting yourself up as a resource and trusted advisor.”
For real estate broker Nova Shank with Champions Real Estate Services in Seattle, Wash., a site like Hootsuite is a real time-saver, allowing him to post content on his Facebook, LinkedIn, Twitter, Instagram and other social media at the same time. He also uses RealtyJuggler, a customer relationship management (CRM) system, and the MailChimp email marketing service, as well as sites for building websites and designing his logo and business cards.
“Technology has gotten less expensive,” he says. “What used to cost me hundreds of dollars a month now costs me only $100 a month.”
What’s Next for the ToolboxAlthough new mobile apps will continue being created, Lund sees more technological breakthroughs coming in other areas that not so long ago were more science fiction than fact.
“We’re in a place today where anything you can do on a desktop can be done on mobile,” Lund says. “That’s a pretty significant development. In the future, you’ll start to see some of these things happen with 3D imaging.”
Companies have already taken up the challenge. For Mountain View, Calif.-based Matterport, their business is producing 3D home tours. In the case of Menlo Park, Calif.-based Oculus, the future is in developing wearable and affordable immersive virtual reality headsets for gaming and other applications.
“With virtual reality applications, you can literally tour a home, walk up to a window and look out it,” Lund says.
At present, Matterport offers only virtual interior tours. However, Lund believes it’s only a matter of time before the capability will expand to the home’s exterior as well, allowing users to walk around a property—virtually.
While the concept of virtual reality and its practical applications to the real estate industry is exciting, Lund says that the price point for the technology is the largest concern.
“There’s a price barrier that will need subsidies from somewhere,” he says. “Clearly there aren’t enough real estate companies willing to spend $400–$600 per tour,” he explains.
Programs Accelerate Real Estate Technology Innovation In addition to Matterport and Oculus, numerous other entrepreneurial enterprises are busy developing technologies that can be adapted to the real estate space. And the industry is supporting them.
For example, the National Association of RealtorsÒ (NAR) has a vested interest in making sure its members have access to the latest technological advances. Its investment arm, Second Century Ventures, developed the REachÒ program, which provides selected technology companies with education, mentorship and market exposure to the trillion-dollar real estate market, while leveraging NAR’s strategic expertise.
“What we realized is that there are a significant number of earlier-stage companies whose products have high potential for the industry,” says Constance Freedman, vice president of strategic investments and managing director of Second Century Ventures. “There are also companies whose products, while not designed specifically for the real estate industry, have applicability to it.
“We want to get these products into the hands of our members so that they can use them in order to make their transactions more efficient, make their lives a little bit easier, and positively affect their top and bottom line. We literally scoured the tech universe to bring in those companies we think can make a difference in real estate”
NAR introduced its latest class of REachÒ participants during its November 2014 Realtors Conference in New Orleans. They fell into a few specific categories.
Marketing. Some of the REach participants focus on helping real estate professionals market themselves. For example, Back At You Media offers automated Facebook and other social marketing services to the real estate industry. SmartZip is a marketing automation platform for identifying top home seller prospects and reaching them through targeted online, social and offline marketing campaigns. And although it wasn’t created specifically for the real estate industry, WeVideo allows anyone to create professional-grade videos.
Productivity. Other companies focus on helping real estate professionals run their businesses better. Deductr helps Realtors with their taxes, automatically tracking expenses like mileage. SendHub offers an all-in-one business phone system.
Services. Some new sites and applications let real estate professionals offer additional or enhanced services to their clients. For example, Desktime lets agents help their clients turn unused office space into shared workspaces. Goby tracks energy utilization in buildings to optimize their efficiency and meet regulatory requirements.
Financial. Some websites can help Realtors, agents and brokers connect their clients with funding. Fundwell, for example, is an online marketplace that prequalifies and matches small businesses and commercial real estate investors with lenders. (Auction.com can help with CRE financing as well.)
On the residential side, online marketplaces like LendingTree offer consumers a way to shop for mortgages and other types of loans.
“These companies are looking at the business with a fresh set of eyes,” says Alex Perriello, President and Chief Executive Officer of Realogy Franchise Group. “They’re looking at the way we do things in our industry, and questioning and challenging it. On our side, we’re giving these entrepreneurs a fresh set of customers to talk to. This is the future of our business.”
The Total Transaction Is The FutureAll of these new innovations—whether they involve hardware, software, websites or mobile apps—are designed with the idea of improving the professionalism of agents and brokers in the eyes of their clients.
In one way or another, they’re all focused on helping real estate professionals facilitate the real estate transaction, from managing data and marketing channels to tracking post-transactional details like taxes.
From a business standpoint, Lund believes that while a lot of the transactional details are still cumbersome, technology is working to improve the way the entire transaction is done, with the goal of bringing everything into the palm of the agent or broker’s hand.
“Eventually, we really will be able to do a transaction from anywhere on a mobile device,” Lund says. “Much faster banking services. Getting approval immediately. Contracts delivered immediately.”
Rick Sharga, executive vice president of Auction.com, agrees that technology is destined to bring significant change to the real estate industry in the not-so-distant future because it’s what buyers and sellers want to see.
“I believe it’s inevitable that within in the next 10 years, the majority of real estate transactions will be completed online,” Sharga says. “It’s what the next generation of home buyers will demand.”