By John Minns
To understand what people hate about real estate today take the example of Jess and Tom. The couple are excited. A new business opportunity, an interstate move, and the opportunity to build an exciting new life awaits.
Their problem? Making it happen. Selling their house, finding a new one, transitioning their kids schooling, arranging relocation, and all the other stressful logistics like managing global pandemics that together take the edge off their excitement.
Great people and great technology may help reduce the pain but will never eliminate it. Along the spectrum from nightmare move to mildly frustrating experience however, there are immense opportunities to reduce friction and make the journey more enjoyable.
Whether you are a real estate agent wanting to differentiate through outstanding performance, or a proptech seeking rapid revenue growth; solve one or more of the following and you will be several steps closer to achieving your goals.
There are 3 aspects of property transactions that cause over 90% of poor experiences for residential real estate consumers. Great solutions blend the strengths of people and technology.
#1 Communication – “You promised the world and now you never call me.”
Sound familiar? It is easy to blame the real estate agent for this one, after all they are the ones who make the explicit or implied promise. According to the major portals, over 40% of enquiries are not responded to at all. Buyers are promised access to new listings, only to see them advertised and sold before they had the chance to look. Owners want feedback after buyer inspections and hear nothing for days. Prospective tenants are desperate to know if their application was successful and don’t even know if it is being looked at.
When we understand the needs of the consumer, the communication challenge becomes more nuanced than “blame the agent”. If we are to give Jess & Tom what they need, which communication need is dominant?
- Inform. Technology will lead this as it can combine accuracy and immediacy in a way no human being can guarantee. AI driven Virtual Agents can deliver 96% accuracy against 91% for the flesh and blood salesperson and do it in real time.
- Influence. Human and Machine. Marketing automation driven by data analytics has the capacity to deliver mass customisation across a broad data base and multiple client journeys. When it comes to connecting motivations and actions, human connection is a fundamental need.
- Inspire. When it comes to overcoming the emotions associated with important decisions, empathy is a skill possessed by no bot ever. People make the best trusted advisors at times of high stress and sometimes we all just need reassurance.
The importance of communication cannot be understated. In my time as a leader of a major Australian agency, over 80% of customer complaints related to ineffective communication. Conversely, getting this right was often the major positive differentiator driving market share dominance and high consumer satisfaction.
#2 Trust – “Tell me what is really going on.”
As consumers we expect transparency, particularly when the stakes are as high as they are in property transactions. That explains why over 80% of listings in real estate come from just 2 sources:
- Referral to a trusted agent
- Direct experience of an agent through auctions, open homes, or marketing.
It is also the reason 3rd party lead generation can be exceptionally strong at identifying potential home sellers but often ineffectual in connecting leads to agents with no previous relationship.
Lack of transparency impedes effective transactions where buyers, sellers, investors, or tenants lack confidence to make decisions. “How much should I offer?” “Is there other interest?” “What are the planning constraints?” “Who is the best agent?” If I am confident of the answers to these questions, I will be empowered to act positively and decisively.
Proptech solutions which enhance transparency, provide self-serve responsiveness, and offer real-time accessibility; enable true visibility and trust to flourish.
And the best business relationships occur when the participants have total confidence and trust in each other.
#3 Support – “You weren’t there when I needed you most”
Business hours may be 9-5 but many real estate needs arise when people are at home in the evening or on the weekend. If we can gain instant gratification through on-line shopping and see how far away our ride is on an app, why should we wait 24 hours or more to be told when our hot water will be fixed or the status of our offer to buy a house?
There is a caveat. In his The 2021 Emerging Models in Real Estate Report, respected industry analyst Mike del Prete concluded the power of loss aversion and risk of making a mistake was a key driver for consumers to seek expert guidance in the high value, low frequency transactions in real estate. Our experience with AI shows that consumers will spend longer communicating with a virtual agent to gain facts and information, but almost exclusively need professional advice or human reassurance prior to locking in a million-dollar transaction.
There are 3 broad areas where consumers expect more when they engage with a property transaction and technology can enable all of them.
- Information 24/7. Waiting for a response to simple question on a high value transaction is increasingly unacceptable. Self-serve solutions allowing buyers, tenants and sellers to do their research, connect to services, or update their transaction prior to engaging with a human are now baseline expectations.
- Give me what I want before I tell you I need it. No-one wants to feel they are just a line of data. Consumers share their information with the expectation of gaining value. Solutions which personalise communication including marketing automation and propensity scoring should work behind the scenes to make people feel important and deliver real value.
- I want to know I have been heard. That broken hot water service? Let me know in real time you are aware of my problem, what will happen next, and how it will be resolved. When I know this and can see the solution in progress, I will give you the time to deliver it. If you don’t tell me anxiety and conflict are inevitable outcomes.
Back to Jess and Tom.
Automating their search and research phase, ensuring they can access social proof before they speak to an agent or mortgage broker and enabling them to monitor transactions from the palm of their hands, will inspire confidence.
Ensuring they have access to industry professionals to guide them through the minefield of contingencies and emotions along this complex journey will be equally important.
Doing all of this effectively (and profitably) will be enabled by real collaboration between human beings and technology.
Australians love real estate. Making real estate transactions easier will be a win for all of us.