It’s no secret that technology is reshaping most industries, and real estate, while some believe is late to the party, is no exception.
The pandemic has accelerated the real estate industry’s entry into many of the tools and processes that have helped others. In fact, in the past year, the sector has invested a record-setting $32 billion into technology, according to Dan Weisman, director of emerging technology for the National Association of REALTORS® (NAR).
“While the pace is expected to cool due to the current economic climate, funding will continue to be invested in technology that drives process efficiencies and improves the overall real estate experience,” he says, citing emerging technologies like blockchain, artificial intelligence (AI), 5G and the Metaverse as leading the charge. “Some of the largest tech companies are investing billions to explore the potential in these technologies, which will lead to innovation we haven’t seen before.”
The phrase “how to become a real estate agent” was the top job-related search on Google in 2021, and NAR membership grew by more than 150,000 members between 2020 and 2021, an increase of 60% from the two years prior.
“Arguably, now more than ever, real estate practitioners should embrace technology, not only to gain an edge over the growing number of practitioners, but also to help homebuyers and home sellers through anticipated and unanticipated market conditions,” says Kia Nejatian, executive director of NAR REACH. “Whether it’s short-term apartment rentals, furniture rentals or ride-sharing, it’s important for real estate agents to understand the technology landscape and embrace new tools and services to help current and future clients.”
An Age of Transformation
Nejatian notes that real estate practitioners found themselves rapidly adapting to the new norm of social distancing and remote work and leveraged digital tools like Notarize’s remote online notarization platform, Transactly’s tech-enabled transaction coordinator network, BombBomb’s video marketing platform and BoxBrownie.com’s photo editing and virtual tour capabilities.
“The market also saw a significant increase in highly competitive, often all-cash, contingency-free offers, which led real estate professionals to turn to fintech companies like Knock to provide unique financing options for consumers,” he says. “The pandemic certainly accelerated the adoption and use of these new technologies and many others, which has really helped reinforce technology’s vital role to brokers, agents and consumers alike.”
Seth Siegler, vice president of technology innovation and real estate services for eXp Realty, points to the pandemic as an accelerator for the adoption of a lot of tools and processes that were far from mainstream before it began.
“Besides the pandemic, the wild housing market pushed buyer competition into uncharted waters,” he says. “This gave rise to any and all tools and processes that could possibly give someone an edge. For example, a fintech-enabled process known as power buying, which allows homebuyers to make non-contingent cash offers, is a good example of something that started gaining measurable traction during this time.”
Rajeev Sajja, senior vice president, digital marketing and innovation for Berkshire Hathaway HomeServices Fox & Roach, REALTORS®, explains that pre-pandemic, brokerages and agents alike seemed to find best-of-breed technologies and institute them to the best of their abilities. But these all-inclusive platforms are now emerging more so than ever before, and that could apply to the CRM, marketing, listings and more.
“Ease of use is coming back with a vengeance because agents don’t often want to deal with their tech,” he tells RISMedia. “An offshoot of that is we’re finding more tech platforms leveraging intelligent automation where they are serving up the hottest opportunities to an agent, and cultivating them without the participation of the agent.”
Sam DeBord, CEO of the Real Estate Standards Organization (RESO), suggests that many agents and brokers were forced to jump forward 10 years in technology in a two-year period, and the industry is stronger for it.
“The pandemic proved to us what kinds of remote technology were truly superior to traditional practices and what kinds couldn’t replace in-person interactions,” he says. “Technology is becoming the ‘real estate office’ for more and more of the industry. Virtual brokerages continue to thrive, and traditional brokerages with brick and mortar continue to complement those services with greater ability to work remotely through technology.”
Art Carter, CEO of the California Regional MLS (CRMLS), is of the belief that technology puts brokers and their clients closer together.
“It serves their clients in a way that they prefer to be served long term,” he says. “So, it’s really just changing the workflow of workers and agents. Any technology piece that can let you focus and enhance the relationship is valuable.”
In the last two years, successful real estate professionals have leaned into their relationships in our increasingly digital world, according to Bobbie Jo Foster, vice president of information technology for John L. Scott Real Estate.
“This means different things for different agents—some may be leaning into more video content to connect with their clients, while others are becoming adept at incorporating tools like digital signatures to streamline the process of buying or selling a home,” she says. “Real estate has long been an industry unique in its focus on personal client relationships. That focus on building strong relationships hasn’t changed with the digital age—it might just look slightly different depending on a client’s needs and desires.”
Monty D. Smith, company growth officer for John L. Scott Real Estate, adds that since the pandemic began, it’s dramatically increased the multi-channel communication between brokers, clients and colleagues.
“Now, you’ll still see traditional in-person or phone communication, but many brokers are also incorporating video calls, virtual and live FaceTime tours and multi-channel marketing into their strategy,” he says.
Of course, it’s not a single tool that’s disrupting real estate, but rather a suite—and the way brokers are using them to drive relationships with consumers.
“As a company and industry, we still believe that the majority of business for an agent comes from their sphere,” Sajja says, adding that it’s very hard to build that business if one doesn’t embrace the proper technology to help keep track of that sphere. “There’s enough data out there that shows the majority of people would do real estate business with their real estate agent again, but in reality, less than 20% do. And the reason is agents have not figured out a way to embrace the right technology to stay top of mind.”
Frank Major, chief technology officer of Bright MLS, says that as society turned mobile-first, and through the effects of the global internet, the impact on real estate has been a decline in direct interaction during the traditionally face-to-face relationship between agents and clients.
“Third-party messaging apps have shifted much of the communication and decision-making out of agents’ tools, preventing technology vendors from capturing that dialogue and adding intelligence on top of it,” Major says. “Technology can only provide meaningful intelligence when it has quality data that can be fed into it.”