Chief Executive Officer and Co-Founder at TopHap, Inc.
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Hey, real estate agents, guess what? The world has gone virtual. Have you?
We were lulled into a complacent comfort that we would always be needed even as more technology flowed into the real estate market. But quietly, Zillow, Redfin, Opendoor and the like have been enabling buyers to do their own legwork online while the rise of iBuyers has begun to erode the role of the real estate agent further.
Buyers and sellers are increasingly realizing the only thing they need from a real estate agent is paperwork. Unless we start thinking differently, the world is going to wake up and realize that when they hire a real estate agent to draft a purchase and sale agreement on a $1 million transaction, they’re basically spending $50,000 on a fancy PDF. Real estate agents need to provide more than just a real estate license, but a strong brand that conveys knowledge, expertise and the invaluable intangibles.
Times Have Changed, And Real Estate Agents Can Too
Twenty years ago, a real estate agent took clients around to show them properties they had never seen before. Even for resourceful buyers who would search the real estate section and do their own drive-bys, the real estate agent was still their only ticket through the doorway. In the year 2020, not only can a buyer see all sides of the house, yard and neighborhood online, they can tap and zoom into any room they’d like and even plan where they’ll put the Christmas tree before stepping foot into the living room. By spreading their thumb and index finger, a buyer can see how well the floor-to-ceiling Carrera tile complements the rainfall showerhead. Now, the pandemic is solidifying these virtual behaviors.
So what can real estate agents do so that tablets don’t do to us what they’ve done to newspaper journalists? We must use technology to take market intelligence to the next level — and then incorporate our market expertise to show clients what the internet can’t.
How To Go From Irrelevant To Irreplaceable
Many agents are waking up to the fact that they must use technology to boost their credibility, provide real value and build a trusted relationship that clients can rely on. With the increasing availability of public and private data combined with machine learning and AI insights, we can show clients more than just fancy bells and whistles. We can empower them to turn what may be their largest transaction ever into their wisest transaction ever.
As the co-founder of a real estate analytics platform, I see every day how deep real estate data has the potential to reveal insights into:
• Property characteristics that have the highest impact on current and future value.
• Historical and predictive growth analysis of streets within neighborhoods and specific properties.
• What the real variables affecting property value in different regions are.
• Hot markets and the trends driving them.
• How construction activity affects current and future values.
• A quicker snapshot of attributes from school ratings to noise pollution to points of interest.
• Lot topography and its effects on property desirability and value.
• An optimized pricing strategy, with positioning and timing backed by millions of data points, rather than three sales records.
These are just a few examples. The world of deep data unlocks insights from obvious and nonobvious angles. Often it is how we group this data together and analyze what it means that reveals the biggest insights.
Harnessing The Power Of Deep Data Analytics For Modern Agents
The answer isn’t exclusively about data. It is also about how we analyze, understand and present that data. The most powerful force on earth, the human mind, is limited in its ability to process mountains of data simultaneously. If someone asks you to figure out the cubed root of pi, you’ll immediately turn to a calculator, a machine, to help you out. And that’s OK. We need to embrace our limitations and partner with technology.
AI can do much more than this. It can use machine learning to take a series of changing data points, compare them with historical trends, uncover correlations that we might never have seen, and tell you what a house is actually worth — and how much it will be worth next year and the year after that. Machine-learning algorithms can observe both static and evolving trends and factor them into calculations of a property’s value in real time. Similar methods can reveal neighborhood trends, how they shift and how they may change in the future. They can reveal how much to invest in a property or how to renovate it to maximize the specific preferences of a neighborhood.
The data is out there. A real estate agent could, theoretically, visit every town hall, building department, records department and treasury office and get the data they need. If a real estate agent did this every day for a year, then entered the info into a series of interactive spreadsheets, they would have a fairly robust dataset. But technology enables us to do that in seconds. Furthermore, with AI, data can be compiled, organized and run through trend-based modeling software to produce the kind of information buyers and sellers need — and will increasingly demand.
For buyers and sellers, it will become a right​, ​not a privilege, to have access to this information. As a group of committed professionals, we can and should provide our clients more than just surface information; we can provide the deep information they need to make an informed decision.
So, real estate agents can stay relevant. But we must accept this reality: ​data matters​. The modern agent doesn’t need to become a data scientist, but we do need to deliver the data-driven insights that clients want. To make this happen, we need to embrace technology with one hand and the client with the other. If we use data to help buyers and sellers make the best decisions of their lives, we can do better than make money — we can deliver the trusted advice clients deserve.
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