If you’ve been in the real estate business, you might have noticed that this industry is slowly making use of technology to continue its operations. Now, what does this mean? Is the Internet taking over the jobs of realtors? Read on to know more.
Technologies Shaping the Real Estate Industry
The emergence of real estate websites has completely changed how buyers buy their homes. Instead of going straight to an agent, sites like Zillow and Trulia allow people to narrow the list of homes they could buy. What’s great about these sites is that they give a comprehensive report of these listed homes and the buyer can just browse through them from the comfort of their homes.
There are also online mortgage lenders that help people qualify for a loan even without going to a bank. This shortens the application process. It is only a matter of time before the arrival of a site that takes care of all the legal work in order to finish the buying process.
The influence of technology does not stop there. Statistics show that millennials are most likely to do the buying process all on their own – from start to finish. This generation does not see the need for a realtor given that they are used to doing things on their own, with, of course, the help of technology.
The Reality Realtors Face
While these technological advances change how people buy and sell their homes, studies show that the work of realtors is far from obsolete.
In a 2019 study done by Clever, where they surveyed a thousand people, it showed that 50% is not willing to do the selling process on their own. In other words, they were not comfortable to do negotiations and open houses. They would still want to have a Realtor do this. Moreover, 62% of the respondents also agreed to not feeling comfortable with doing the paperwork.
There is also a clear difference when it comes to different generations. While 93% of the millennials who answered the survey claim that they wouldn’t use a real estate agent, most Baby Boomers are more comfortable having an agent that will do all the work for them. This is not to show that the latter is lazy, but rather the inconvenience of doing the work themselves is not practical.
An Important Insight
Aside from technology slowly taking away the market for real estate agents, there is also one reason why people opt not to hire one – it’s commission fees. A commission fee is the 6% that is paid to the agent. However, the study conducted by Clever showed an important insight into people who buy or sell their properties.
The survey showed that 45% of sellers in the US are not aware that they also have to shoulder the buyer’s agent. Consequently, only ⅓ of the respondents know that the 6% pertains to the final sale price. When sellers knew that this was the case, most of them claimed that the 6% is unfair and too costly for them.
This important piece of data shows how many sellers and buyers are unaware of how buying and selling in the US take place. On the other hand, this is also a challenge among agents to be transparent about the commission fees and to set realistic expectations with their clients. This will be a big help to prevent surprising fees on the side of the seller. It will also prompt them to take advantage of the services offered by the real estate agent.
A Look Back in 2019
With the increasing use of technology-driven apps and online listings, real estate agents are starting to see what could happen in cases where more applications are developed to make buying and selling easier. While becoming obsolete is still a long way ahead, there is nothing wrong with being proactive in order to adapt to these changes.
Just like brick-and-mortar shops that have been affected by online shops, real estate agents can make use of this technology to further improve the services they offer. It can be in the form of better customer service or more sophisticated selling techniques. At the end of the day, people will go back to agents as they give a more convenient and hassle-free transaction.
