Heard from an industry fat cat (actually, more like a kitty) that the FTC has approved the Zillow-Trulia merger, and it will be announced soon. No surprises, if true.
“The ‘sharing economy’ [has been] outed as the ‘rental economy.’ Nobody is sharing anything, people are making money, plain and simple. Technology has made renting things (even in real time) as simple as it made buying a decade ago,” venture capitalist Fred Wilson wrote this week.
Now you can use Uber to tour houses, thanks to Trulia’s integration of Uber into its home search app. Love it — no parking hassles, it is more efficient, and home shopping with a driver may make you feel special as you try to bump out the competition for that perfect house. But beware: don’t take housing advice from an Uber driver.
You said, he said, we said
Nearly half of all those recently surveyed (750 brokers) by Inman said that “technology that allows companies to streamline operations at a smaller scale is part of the reason for the resurgence of the indie brokerage model.” See the complete 50-page research report later today on Inman.com.
Astronauts on the International Space Station used a zero-gravity 3D printer to produce a socket wrench in order to make an adjustment on the ship. NASA Mission Control sent the digital plans for the wrench from Earth.
Innovation, adaptation and creativity is what real estate brokers must do to stay relevant. They are the link most at risk in the new real estate value chain.
Agents now go direct to the Internet to get leads, and they acquire cheap (or even free) easy-to-use, cloud-based software to manage their transactions and leads. Mentoring, coaching, training and legal protections are still core to the broker’s value proposition, but they must do more to add meaningful value.
Of course, the agent’s backend should be the broker’s domain, in which they provide lightweight CRM and transaction management software for their agents. But let’s go deeper, providing something for both the agent and the consumer, a shared experience. The current home buying process is coyote ugly — inefficient for everyone, most importantly for the customer. Most of the process now is done by email — jeez Louise, so 1990s.
My advice: create a shared dashboard for agents that can be extended to buyers and sellers. Force vendors to use it — title, escrow and mortgage. Imagine a password protected app that manages the process for the buyer or seller. This simple, well-designed dashboard would be handed over to the consumer by agents the day the deal gets started. Key features would be status, notification, storage, alerts and communication.
Here is the spec for this killer dashboard (did I really say that?):
- My profile: An easy way to submit all of my data, but the machine gets smarter as I go deeper into the transaction with prefill features and auto-correction. It prevents me from having to key in information each step of the way or having my service providers do it for me.
- Listings hub: This feature includes listings during the buying process and afterwards which would include updates on active listings that I am looking at. (This feature already exists but not integrated into a more complete consumer dashboard). The status of these listings should change and represent dynamic comps with historic sales, once I find a property, giving me confidence or not about the deal I am about to consummate.
- Vendor requirements. The requirements list from vendors should be integrated into my dashboard, plus a selection of key vendors who I can choose from with pros and cons and ratings from my agent
- Costs. A dynamic cost estimate calculator which changes as I weave through the process and includes estimated monthly carrying costs based on changes in rates, and the final house price or concessions as they are negotiated.
- Communication. An internal messaging tool that all my vendors are on, so I can use mobile to stay in touch. One scenario is to integrate Wechat into the dashboard.
- Notifications. Real time notifications — “sign this, retreive that, do this” — for what is due and when with alerts.
- Files. Stores all my house-related digital documents like DropBox, retrievable now and later at tax time.
- After market services. All of my post closing vendors, synced into the system: cable, gas, Nest, electrical, garbage and postal.
If I had received this dashboard from my broker, I would always remember the service he brought beyond a friendly and eager Realtor running around on my behalf.
FYI: This idea came from my recent L.A. house experience. An in-depth study of one, me. It is all about me.
In 9000 B.C., sheep were first tamed in the Middle East, then pigs and cattle. Now, 11,000 years later, real estate brokers have still not figured out how to tame their agents.
Why is this?
- The compensation model: agents are rewarded based on success for their efforts, not a paycheck which might otherwise make them beholden to the broker.
- The independent contractor status of agents, no strings attached employment — this system screams Lone Ranger.
- Agent DNA, naturally independent or they do not survive. The correlation between effort and consideration is like the necessary bond between java and waking up.
- The broker business model of letting anyone in the door to peddle deals. A slew of irresponsible agents are hard to control, motivate and train.
- Better training through outside coaching, internal training and franchise education programs.
- Systematic and intelligent recruiting. Adopt high standards; test everyone over and over again; conduct multiple interviews with top-producing agents and serious reference checking. Hire slow, fire fast.
- Change the business model. Stop recruiting unqualified agents, and get rid of the chuckleheads. Recruit no agents who are missing a few french fries in their Happy Meals.
This headline from The New York Post just ruined my day: “Flipping is back.” Sure, turning property is perfectly legal and represents the American spirit, but it can also be code for a market running too hot with unintended consequences, such as hyper-inflated prices, skyrocketing rents and affordability problems. Plus, a super-heated housing market attracts schemers, scammers and other nefarious types who can ruin a good thing.
Checking out. Adios, amigos!