The idea of disrupting realtors has been around for years, but now several companies, backed with mega-millions in VC money, are making a dent. They may not be taking a lot of the business away (yet), but they are being noticed.
It appears some of the big brokerages might be starting to feel it:
http://www.notorious-rob.com/2018/07/stages-of-decline-the-keller-williams-edition/
KW isn’t going anywhere – they have 180,000 agents.
But there is an underlying threat, real or imagined, that the entire real estate industry will be upended by technology that could change everything.
From the link above:
Zillow spent $320 million in 2017 on Technology and Development. In 2016, they spent $255 million on Technology. Over the past five years, from 2013 to 2017, Zillow spent a total of $893 million on Technology and Development with significantly more than 200 people who touch code.
The mom and pop brokerages are getting smashed by this tech steamroller.
Combine the tech advances with higher home prices and fewer sales, and we have a toxic blend for the old-fashioned veteran agents. Many are getting out of the business, and others are left wondering what happened.
Realtors who plan to get out of the business in the next couple of years will just ride it out. But those in for the long haul need to buck up.
If your not moving forward, your going backwards.
Nothing stays the same.
Hate to say it, but the old school realtors are becoming the old school paper boys. Eventually you won’t need a person to deliver a house when you can do it all on your phone or computer. This trend became apparent when buyers and renters take ownership from a video without stepping foot into a home.
There simply has to be a way to balance the custom, one-off nature of a home sale with the efficiency of technology. Paying $60,000 in transaction costs to sell an average coastal home doesn’t make sense.
“This trend became apparent when buyers and renters take ownership from a video without stepping foot into a home.”
You’ll not going to get the real vibe of a buyer or seller, much less a house, off the internets anytime soon. Corporations are “anonymous” for a reason. It makes it a lot harder for one person to get to “the guy” who screws them. Not relatively cheaply, anyway. Corporations can make lawsuits stretch out 10 years. The laws governing real estate transactions still have that Dodge City flavor flav.
Professional real estate brokers aren’t going anywhere anytime soon. Just the riff raff maybe, and even then it will take time.
When/if I’m in any deep water deal, that which entails the exchange of money that will affect my future, I want to be able to sue the people around me real easy, if needed. I want their heart to pound if I start talking about it. I don’t want to be playing “hot potato” amongst a herd of Redfin weasels sharing skin in the game, and retard arbiters.
There simply has to be a way to balance the custom, one-off nature of a home sale with the efficiency of technology. Paying $60,000 in transaction costs to sell an average coastal home doesn’t make sense.
We’ll be covering this very topic as time rolls on – the industry needs to demonstrate the differences to the consumer.
Consumers want and need different levels of service. Those who are cost-conscious go to Wal-Mart, and those who value professional help go to Nordstrom. There is a place for both – and more people go to Wal-Mart.
You’re not just buying a can of beans though. You’re making one of the biggest decisions of your life, in an arena where the consumer has very little, if any, experience.
Eventually you won’t need a person to deliver a house when you can do it all on your phone or computer.
The delivery of a home is just part of the equation. But for those consumers who just want their order processed, there are several good solutions available – and cheaper than Redfin too. But if you prefer to get top-quality advice that can make a difference of 5% to 10%, then $50 agents aren’t for you. They don’t do that – they just process your order.
It’s easy to think you don’t need help when we’re in a bull market, but those days are over. O-V-E-R.
The biggest problem is that you only have one chance to make the decision. Once you hire a realtor, you just get whatever they have. You don’t get to throw out that can of beans and go buy a different one.
People like to compare us to travel agents. But if you book a trip online that turns out to be less than perfect, it won’t change your life – you’ll shrug it off and remember it for next time.
How many times are you going to buy and sell a house? For the vast majority, it will be once in your life from now on – and mistakes are costly. They can live with you forever.
Buying a home — likely $1m or higher in this area — will be the most considered purchase of your life. Plus, it will be bought in an open market vs fixed price… why WOULDNT you pay $60k for sound advice and guidance?? It makes a material difference, toward the positive, to seek good counsel. Same goes for dealing with the IRS/hiring an accountant. A good RE agent and a good CPA can take you far financially! Jim and Donna have proven this to me through purchase of a rental property of ours. Regardless of the “worth” of the transactional side of it, or the worth of the 8 years of free data I got from Jim on the housing market through his blog, they helped me basically rehab 2 houses, using great subs, and were central to me getting said houses operational and rentable, quickly (gas leaks and bad roofs and all!). That is so worth the 6%… the idea that it may not be is absurd!
Thank you BAM!
The blog helps me demonstrate the extra value with comments like yours – I appreciate it, and you!