Technology is creating a tsunami of changes in the real estate industry, forcing many agents to scramble to stay ahead of the wave.
According to Stephen Carpenter-Israel, president and broker of Buyer’s Edge, a leading Bethesda, Md.-based exclusive buyer brokerage firm, the increased use of the Internet to buy or sell a home as well as a recent California Supreme Court ruling on the controversial practice known as “dual agency” are turning the real estate industry on its head.
This is leaving agents with clients who are growing increasingly wary of the traditional brokerage model and confused about how best to move forward with the complicated and time-consuming purchase or sale process.
“As homebuyers and sellers become more savvy, they are increasingly looking for a true fiduciary relationship with their realtor,” said Carpenter-Israel. “They are demanding complete transparency and loyalty with no conflicts or competing interests.”
As a result of the infusion of technology into real estate, tech companies like Zillow, Trulia, and Redfin sprouted like spring daffodils about a decade ago.
Carpenter-Israel noted that the new online database companies “upset the ‘cartel’ of the old brokerages.”
While these tech firms are offering quick and free access to information at clients’ fingertips, they can’t replace a real estate agent.
Diane M. Ramirez is the chairman and CEO of Halstead and has been an active real estate executive and broker for more than three decades.
In a recent interview with Forbes, Ramirez noted that technology plays a key role in the way a service-based business operates in today’s economy. In fact, her company was among the first to hire a programmer to develop a listing system rather than working from index cards. They also had a computer in the company’s branded vehicle.
“Fast forward to today, and we are still deeply committed to continuously investing in and enhancing technology for our agents and customers,” she said. “Just in the last year, for instance, we launched reSOURCE, the industry’s most sophisticated listing system and database; an analytics tool that enables agents to create customizable market reports based on individual clients’ needs as well as delivers data that covers not just the supply side but the demand side too, capturing searches from the users of our website so we can analyze their requests; and Instant Value, a proprietary appraisal tool that assists with the pricing of Manhattan and Brooklyn apartments.”
As a result of the ever-changing technology today, most real estate agents can’t remain competitive unless they update software, equipment and accessories that they use on a regular basis.
The most frequently cited reasons for upgrades in technology include: the industry has experienced changes, like processes that have been added or that require different equipment. Some of the new technologies can create a faster, more efficient home-selling process.
For agents that fall behind the technology curve, they risk business slowdowns that cost them revenues and damage their brand or agency.
Carpenter-Israel noted the internet has caused a major paradigm shift in the way the real estate industry transacts business.
“The new technology has also brought many more options and opportunities to consumers, real estate agents and brokers across the country by increasing transparency and the ability to quickly and easily search vast amounts of opportunities,” he said.