The real estate sector is experiencing a technological revolution, one that is helping agents. This trend is in spite of software platforms and new business models wanting to remove people from the value chain, a practice called disintermediation. Efforts to reduce the roles of estate agents or remove them altogether are largely a failure—and good riddance to that.
This is one of the observations from Antonie Goosen, MD and principal of Meridian Realty, after his recent visit to the Inman Connect Conference in New York.
“Disintermediation of agents is failing. People mistakenly believe that estate agents don’t add value or that they complicate the buying and selling process. But agents are still the last mile in an emotional process, and most people want them. The difference is that they want good agents who have knowledge and empathy.”
An Evolving Agent Market
Though the Inman Connect conference primarily focuses on the US market, Goosen found that it shares many similarities and overlaps with the South African real estate sector. Real estate is consolidating with new technologies and more mergers & acquisitions, in some cases shrinking the number of agents.
However, this is distinctly a trend of quality over quantity, as more agents are using technology to increase their autonomy, independence, and earnings.
“What agents want is not necessarily all the traditional things that were out there. Not all of them necessarily want a desk in an office. Many agents are extremely entrepreneurial. They don’t have a salary at the end of the month. They never know exactly what they’re going to earn. They’re only as good as their last deal. So, they are effectively business owners, and a lot of them are aligning to newer models where technology helps them to better serve their clients.”
Research findings presented at the conference reflect this shift: among thousands of agents surveyed in the US, only 24% expected physical offices. In contrast to disintermediation, digital technologies actually shift more power to agents and create a talent-centric market, prompting them to reevaluate their stake in transactions. Over 70% of the agents surveyed are reviewing commission splits.
These trends are not spontaneous. The conference presentations also highlighted a shift in customer expectations, says Goosen.
“Consumer demands have increased significantly. Buyers are more informed. They wish to get a better sense of the home before they look at it, so immersive experiences like 3D virtual walkthroughs are more popular.
“This preparation leads to a higher intent inquiry — the chances of them being genuinely interested in that specific property are higher than they used to be before. There’s a higher expectation for on-demand appointments, to pick a time to view a home and confirm it instantly online. And transparency of the buying process is becoming very important.”
The Market Belongs To Better Agents
These expectations require clued-up and responsive agents. Such agents are using digital technologies to improve their performance, from integrated customer relationship software to wielding the latest artificial intelligence opportunities.
While there will always be real estate offices and conglomerates, it’s their affinity for digitalisation that creates the market’s watershed. Brokerages that support staff and independent agents with the right technologies, communication channels, design services, and market intelligence will thrive.
These trends are good news for agencies such as Meridian Realty, which focus on providing such services to independent agents. But Goosen also warns that agents can’t be complacent — they might hold their ground as the touchpoint customers want, but they need to adapt if they want to remain relevant:
“Up-to-date agents are the last mile; they are still needed to guide people home in what remains a highly emotional process. However, we have broker consolidation, but we also have agent consolidation. By utilising digital systems and AI technologies, some agents are taking a larger and larger slice of the pie, and other agents are starting to be left behind. At Inman Connect, the consensus was to anticipate a drop in the number of overall agents in the market as a result of that.”
How can agents adapt to this new reality? Get to know the technologies and trends, and use an agency that will support them.
“You need to immerse yourself in the latest technology. You need to stay updated on trends. But it’s very difficult to keep abreast of all of the changes when there are so many different things that agents need to do on a daily basis. Align yourself with a company that takes care of that so that you can focus on the most important things, which is buyer and seller interaction on a human level.”