Despite the constant buzz surrounding technology and its impact on the industry, it is unlikely it will replace the role of a trusted real estate advisor. Here’s why.
Will technology, artificial intelligence, and machine learning change the real estate business? The answer is yes. Will these disruptors replace the role of the real estate sales associate? I don’t think so. There are five universals or pillars of our business that have not changed and will require the role of a trusted real estate advisor in the future. Technology will change how we do the business, but these five pillars make what we do unique and require a carbon-based life form to orchestrate them.
1. Frequency: People only purchase or sell a home on average every 8 to 10 years. This is not the same as ordering a book, an airplane ticket, or a Netflix video. The requirements for selling and buying 10 years ago may be very different today. Most people only buy or sell a home four or five times in their lifetime. The experience ranks up there with graduations and weddings in the frequency of life events. Due to the lack of frequency, people need help navigating the process, which changes with market cycles and legislation.
2. Uniqueness: Every property is unique and has unique marketing challenges. We are not selling iPads or cars. We are selling one of a kind. Add the different personalities of buyers and sellers into the equation, and every real estate transaction is unique. Have you ever had to talk a buyer or seller off a ledge? Throw in the emotions of a divorce or a job transfer. Does a computer algorithm have the empathy and counseling skills to deal with the human side of a real estate transaction? A trusted advisor, not machine learning, is the critical value component here.
3. Size: The numbers are huge—typically a home is the largest financial and emotional transaction in a person’s lifetime. It’s not the same as ordering an Uber.
4. Complexity: There are a lot of moving parts in a real estate transaction—by some estimates over 80 details to be handled. The real work often starts after going under contract. The iBuyer movement is attempting to simplify the process, but at a significant cost to the seller. Will this movement be a niche or become broad-based? Because of the other four pillars, my feeling is that the iBuyer component will be a niche for some sellers.
5. Risk: Due to the size and complexity of the transaction, there is a fair amount of risk. If something goes wrong, you can’t just “send it back” as you do products from Amazon.
Because of these five pillars, clients need sales professionals with deep smarts in marketing, negotiation, real estate law, and contract management as well as empathy, customer service, and communication skills. They need a trusted real estate advisor and concierge.
When I go over these five pillars with sales associates, owners, and managers, they seem to get a stroke of insight and clarity. They stop being confused and afraid of the disruptors and new technologies. They start focusing on their relationship-building skills, empathy, and finding ways to create a WOW! experience for their clients. The new technologies will assist the sales professional, but not replace them. Most clients are not looking for an app or algorithm to help them. They want an empathetic, trusted advisor. Provide this level of service, and our future is very bright!