Top industry leaders met recently in Palm Desert at Inman Disconnect to discuss their predictions for the future of real estate.
Part I of this two-part series focuses on cash offers, social consciousness and ancillary services.
Summary of Industry Views
- 50% of all home purchases to be made using “alternative methods” of financing by 2030
- By 2030 or before, cash offers to become the default purchase offer
- Inventory shortage to remain through the decade
- Due to continued inventory shortage, home prices to remain high and likely higher
- More potential homeowners to explore shared or co-ownership options with family, friends or strangers
- Future of industry more digital, more seamless, more diverse, more conscientious
- Future listings may talk to you
- Brokerages to be more responsive and flexible to agents wanting hybrid and/or fully remote work environment
- Agents to adapt to changing needs/demands of clients & consumers who may need transaction-focused, touch-free experience, a hands-on guide, a financial advisor, and metaverse agent/broker.
Predictions for the Real Estate Industry from 150 Industry Leaders
A pronounced theme that came up multiple times with multiple subsets at this Inman Disconnect by-invitation only meeting held in Palm Desert recently was that any offer not a cash offer is considered to be “subprime.”
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One group among many breakout sections said, “We believe that cash offer products, so people who are making cash offers, will be the default scenario by 2024. In most major markets, if you submit an offer that has a financing contingency, that will generally be considered a subprime offer.”
One group said that the amount of home purchases using “alternative financing” would represent 50% of transactions by 2030.
Remember that in 2021, cash offers accounted for 23% of all home purchases. This predicted cash offers scenario could at least double this percentage by as early as 2024.
Another attendee pointed out that by 2030, “More than a third of sellers will buy before they sell. And more than 50% of buyers will use financing tools to make all-cash offers.”
Companies that thrive will need to have a social conscience. Being socially conscious means being actively committed to addressing concerns such as climate change, diversity and inclusion, affordable housing, social injustices, wealth discrepancies and more. One group leader said that companies “need to pay attention to where they can actually make a difference and really make an impact.”
Brokerages will lean into ancillary services. Several brokerage firms have already chosen to boost their revenues by offering ancillary services such as mortgage, title and relocation in light of two specific trends. One trend comes from downward pressure on commissions…why should agents continue to split 6% commissions on homes purchased online? Another trend comes from consumers wanting seamless transactions…why should consumers have to look around for a separate mortgage provider, a title provider and a relocator service when just one click will make it all happen?
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Thanks to Inman.