What does the future look like for real estate agents?

Someone recently asked me at a wedding I was attending, “how will you be doing real estate in ten years time?” The easy answer for me was to explain how the job has changed since I joined the industry and then times continue the line into the future.

So how did the job used to be?

I’ve been selling real estate with a focus on the North Wellington real estate market for approximately 15 years. That’s one hellava long time in real estate by modern standards.

When I first started the job,

*Agents held the information. There were no online property information services.

*Advertising was print media based and space was always at a premium. Adverts were largely limited to one small photo and about 26 words of script ( Try telling the story about your own house when you’re limited like that!).  There were no property websites.

*People picked up the phone or walked in the door of the office when they wanted to find out about property in an area. Saturday morning was one of our busiest days with home buyers streaming in the door to talk to an agent. You sat them down in a little room and asked them questions to gauge motivation to buy(you made this call before you took them out in your car cos you learned very quickly to dodge timewasters) and you also compiled a  list of their needs and wants and put in a little time updating them on the current market conditions.

* Agents were taxi drivers. Open homes were just starting to become popular but were a fringe activity that was only partially successful. As an agent, I would cultivate a relationship with Serious Buyers and book in time to drive them around on a circuit of properties that I believed fitted their profile.

* Homeowners hired agents based on signage, mail drops, referral of friends, or previous successful business dealings.

* Real Estate was an office based activity. Cellphones were a cool thing to have on your hip but texting didn’t exist and the phones were too expensive to use unless it was an emergency. You were given a desk to sit at in a little cubicle, often in an open plan office. You were given a landline and told to make cold calls, knock on doors, fill mailboxes with leaflets, chase your friends up for leads, and follow-up buyers you had on your books.

* It was a paper war. Pieces of paper everywhere – contracts, property details, flyers, advertising.

* The agents who were longest in the office got the first dibs on car parks, buyers (walk ins), and potential seller enquiries. Beginners were gophers – doing open homes in the worst houses on the companies books, dealing with the no hoper D grade buyers who were only out looking for a bit of company or wanting ideas for their own home kitchen renovation.

* The real estate industry was largely self governed which did allow for some abuse by roguish individuals. The reputation of real estate agents was at a low ebb. There was little government involvement.

* House deals fell over mainly because buyers couldn’t secure finance.

What’s changed?

* Buyers hold as much information as agents. Online resources give buyers an overview of individual properties, markets, or locales.

* We are in the transition from print media to online. Many dinosaurs hold on to the old skool ways of doing real estate and gullible homeowners still believe them when they push them to pay the exorbitant costs of print media adverts in property mags or regional newspapers.

*People email or text first when enquiring about property. The phone still goes but not with the frequency that it used to. Almost no one walks in the door of our real estate agency to purchase or sell a home. Interestingly, potential renters still do a lot of legwork.

*Agents are open home hosts, marketeers, and hand holders rather than information providers. There is still a very valid role for agents in my view. Home selling is more than just banging a property up on trademe and waiting for buyers to hand over an offer. There is a lot of reassurance needed in today’s post leaky building environment. Buyers are on info overload and often this stops them from reaching their property ownership goals. Good agents help the buyers commit to a purchase emotionally and work with them over days or weeks to reach the point where they unconditionally purchase the property and pay a deposit. Though this is where the job of agent officially finishes, there is a certain amount of handholding and information relaying needed right up until after they’ve moved in.

* Agents are still largely sticking to the old ways of prospecting for new homes to sell but there are changes in the air. Tech savvy agents are coming into the market place and using social media, property apps, blogs and other online focused methods to stay in touch with old clients and gain new clients.

*Real Estate is no longer an office job. Smart phones were the final nail in the coffin for the corner real estate office. Interestingly, many agency owners still want an office to provide t he agency with profile, but the salespeople themselves are frequenting the office less and less. The cubicle style spaces that most real estate agencies provide is not helpful for promoting productivity in their staff. Owners are struggling to maintain contact with their salespeople as the car or home office becomes the main place for doing real estate marketing.

* Real estate has been forced to clean up its act and the government has got involved in the governance of the real estate industry and it’s players. Contracts, agency agreements, rules and regulations have become progressively complex. Agents have had to put systems in place to safeguard themselves in case of  litigation. The agent is often a soft target in leaky building disputes and for vexatious claims by disgruntled buyers and sellers.

* Conditional house deals fall over mainly based on the builders report. Increasingly exhaustive builders reports have become the biggest hurdle to getting buyers to unconditionally commit to a property purchase. Within my own company, there are some inspection companies who crash more than 70% of the deals they are called to inspect. This is a scary trend and the real estate industry will have to come up with constructive ways of helping home owners achieve a successful sale.

The future??

*Online!

*Info overload

* Mobile location-based property companies without offices and with fully integrated computer systems covering every aspect of  a real estate salesperson’s business.

*Further increased regulation and government intervention

*Social media prospecting – Facebook advertising by agents, online advertising by agents on property websites, online referral websites (eg.linked in) for clients to be able to provide feedback on agents,  huge use of email databases to get new business and for personal promotion.

* Increasing use of mobile apps for property marketing – instagram, Facebook, foursquare, google places, and many apps we haven’t seen yet to target specific buyer profiles rather than the currently blind blanket marketing approach.

* Vendor builder reports and compulsory providing of property information like title searches and LIM reports. More time spent by agents helping homeowners prepare for sale so that the marketing programme runs smoothly.

* Video for property advertising – not just a digital slideshow slapped together by the brother of the sales agent, professionally drafted and created web adverts for properties and for personal promotion. Use of models and props and storylines in online images and videos of properties to sell the benefits of the property not just list the features.

* Live video and webinars, online forums and chatrooms to talk directly in real-time with buyers, sellers, and to aid negotiations of property deals. The rise of the virtual agent – selling and negotiating property deals solely online with no direct contact on the buyer side.

I’d love to hear from you. How do you think the process real estate marketing will change in the next ten years? Is there still a place for a real estate go between? Thanks for reading. If you have any property related questions or a cool topic you’d like to hear my opinion on, don’t hesitate to drop me a note. Check out my North Wellington Property Blog. It’s full of juicy local goodness.

Dave Garratt – Guardian First National  

October 26 2012 07:10 pm | General Real Estate

2 Responses to “What does the future look like for real estate agents?”

  1. Cam on 02 Nov 2012 at 11:40 am #

    Hi Dave,

    I have one question for you..

    Do you believe there truly is NO place for print media in today’s real estate marketing world?

    I will enlighten you with my thoughts first :).

    As a salesperson, I frequently use the biggest and best print media spots available – front and back covers of the Wellington Property Press, and full page advertisements in our Upper Hutt Newspaper (The Leader) which is distributed to every home in the area. Combined with tools such as TradeMe’s ‘Super Feature’ listing, RealEstate’s campaigns etc, I know that I achieve far better results than those who just use small print media adverts, or none at all, especially when selling a property in my area which would not usually attract purchasers from Wellington etc. I always ask the question ‘where did you first see this property advertised?’ and when those big campaigns are in place, the answer is most commonly ‘on the property press’ or ‘in The Leader’.

    I agree that any really serious buyer who is looking to buy a property right now will be searching the internet every day for new listings, but what about the causal buyer who looks every now and then, if you’ve got a stunning property which they fall in love with and buy, without looking at everything else on the market/internet etc, you’re undoubtedly going to fetch a better price than from someone who has seen damn near everything else on the market and is completely in tune with what similar properties are selling for.

    Finally, when those big print media campaigns, such as a full page in our Upper Hutt Leader, front cover of the property press etc all in the first week are in place, they easily double and triple the numbers at a first open home. Now I know for a fact that the majority of those extra people are just tyre kickers, nosey neighbours, and people who just came because it looked like a nice place and they could get some ideas for theirs, but surely these extras cause those serious buyers who like it and are in a position to buy, to feel that ‘fear of loss’ and sense of urgency to make an offer and make it a good one.

    I don’t believe in spending $2000-3000 spreading little 1/8th page adverts over 8 weeks in a couple of different publications, but spending the same in the first week on some big ‘in your face/can’t miss them’ spots – I have, and will continue to encourage vendors to do this, and put my money where my mouth is by using the same tools when selling my own properties.

    FYI, I am not a dinosaur, I am a 22 year old, three years into my selling and property development career.

    Sorry I went off on a bit of a tangent there, but to ask the question again, do you believe print media has NO place in real estate marketing?

    Cam

  2. David Garratt on 02 Nov 2012 at 12:42 pm #

    HI Cam,
    thanks for your comments.
    Yes there is still a place for print media but it is diminishing over time.
    When it comes to targeting advertising dollars most efficiently, I apply a very general rule – if the target market is over 40 yrs old then print media such as the property press still reaches those buyers. If the target market is under 40 then money is best put into online marketing.
    eg if I have a little two bedroom unit on the flat close to shops, my target audience is probably retired or retiring couples or singles and I’d push a bit of money towards local paper advertising and possibly the property press. If the property I’m selling is a central city apartment – I would use web only advertising. Tailoring your marketing is much more effective than giving no thought to your end market and just doing a bit of everything.

    I think we’ll see a more and more accurate targeting of buyers over time using online adverts such as google and facebook ads and email database mailouts as opposed to the blanket approach of print and website advertising.

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