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Posts tagged ‘buyers and sellers’

1
Dec

From Pocket Listings to MLS to Artificial Intelligence. The Future of Real Estate

eye-scanOh, my have things changed. The simple process of buying a house 50 years ago is nothing like it is today and I can say with 100% certainty, that in 20 years it will be unrecognizable from today’s process. Right now hundreds, if not thousands of technology companies are vying to be the Uber of real estate. But is eliminating the Realtor the right decision or is the answer going to be a combination of providing better search functionality to potential home buyers with specific Realtor insights? As they say, nothing is as constant as change and today change is happening faster than we could have ever imagined. Consider the widely held model of exponential growth. It goes something like this. If I took a hundred steps from my bedside table (each step being about 3 feet), I might end up in the middle of the street, but if I took a hundred steps, where each one was twice as big as the previous step, I might end up on the moon. You get my drift.
The business of real estate sales essentially got its start the moment someone discovered that they could make money brokering a deal between a willing buyer and seller. Back in those early days there was no centralized listing service. A brokerage was entrusted to sell a home and a very basic listing agreement was drawn up together with a rudimentary information sheet containing the basic facts of the house. Brokerages put advertisements in local newspapers and carried these sheets around with them. This is the origin of the term ‘pocket listing’. Buyers found homes the old-fashioned way; they would search the want ads or drive around town looking for a for sale sign. The system worked. It wasn’t efficient but it was all we had and I am always reminded of old school real estate when I watch the holiday classic “its a Wonderful Life”.
Move the needle ahead 50 years and the search is a lot different. We have the Multiple Listing Service now and sharing of listings is much easier. Agents have access to homes not just across any city but around the world. It really wasn’t that long ago when a buyer would call an agent and tell them they wanted to buy a house. The Realtor would type in a few parameters and would have access to several homes that met a client’s needs. Then the internet altered the face of real estate sales for ever. Search was opened up to the consumers in ways we never imagined. Today’s buyer can look at a home on the other side of the world and take a 3D tour. They can walk the neighbourhood from the comfort of their sofa and conduct the transaction from a smart phone. Today the Realtor’s role has also shifted from house finder to deal negotiator, marketer, stager and advisor. Where is it likely to go next?
Now that Tesla cars don’t need drivers anymore could the Realtor be removed from the real estate transaction altogether? It’s not that far-fetched. Consider this example; You are a young man preparing to go out for the evening. Your phone can already tell you which bars have the most girls because an eye scanner at the door has already calculated places to go to meet single women. At the bar a chemistry app has alerted you to a perfect match for you based on habits, education, social status and hobbies. You hit it off. After a few months of dating, the internet realizes that you two are a perfect match. You are buying two of everything…movie tickets, trips and dinners. Based on geo tracking, bots already know that you sleep over at her place 4 nights a week and based on the TV shows that you watch and the things you shop for algorithms have determined the style of home or apartment you are likely to gravitate toward. The internet knows how much your combined income can afford and in no time Artie, the artificial intelligence realtor bot emails you about the perfect home or condo. It’s an easy commute to work and you are pre approved for the loan. All you have to do is hit accept and the movers will show up in 30 days, pack your stuff and move you into your new home. Unlikely? Frankly we are already there. The tools and technology are already in place. Predictive marketing is widely practiced around the world. So what is stopping the internet from making this a reality? The answer is simple… Humans. Humans won’t take advice from a computer. Sure, maybe if you are on the space shuttle jetting around in space, you might take the advice of a computer, but here on earth, searching for a home? Nope. At least not yet.
So, what are Realtors likely to expect over the next 20 years? I can’t think that far away but it might be easier to look forward 5 years. I think it is fair to say that for the next 5 years, relationships and service will still rule the real estate transaction. People will gravitate towards the Realtor who knows the market and has experience and understanding. We will start to see some shifts in the way people live, smaller homes, co-owning, live/work, and perhaps people will live further away and take the autonomous bus, complete with work stations, into the city every couple of days. The public will continue to have more and more access to housing information, such as school districts and other neighbourhood statistics but few will have the ability or time to process it all. All the bugs of artificial intelligence and predictive marketing will be ironed out, but people will still need a lot of consulting around the home purchase or sale. Lastly, buying or selling a home will remain the single largest and most complicated transaction of most people’s lives and a skilled intervener will be paramount to the equation. The Realtor who can unlock the most helpful information will excel and those not willing to push the boundaries will wilt away. I love to think about this stuff.
Mark McLean is the Broker/Manager at the Bosley Real Estate Queen St W office, the Immediate Past President the Toronto Real Estate Board and a director at the Ontario Real estate Association . The opinions expressed here do not reflect the opinions of TREB, OREA or Bosley RE

5
May

WTH!?! Your Client Walked Away Over That?!?!

broken microvaveI’m trying to be polite here. The “WTH” stands for ‘What the heck”. A few weeks ago at our Mastermind session we talked about how an agent lost a deal over a relatively small item. In this case it was a $500 Ikea cabinet. As soon as that story came out others piped in about some of their lost deals too. It was surprising to see what buyers and sellers would walk away from. I put it out to my Facebook friends and got some wild responses.

One person lost a deal over a pool table when the seller was moving out of province anyhow. Another lost over a broken snow blower. Apparently the seller promised it to a nephew and buyer walked without it. Other inconsequential items included a fridge, a $100 microwave, a bookshelf, drapes and a flowering shrub in the garden. Of course it isn’t always about possessions. Sometimes it’s a technicality. I heard from one friend who had a deal fall apart because the age of the home was reported as 14 years old when it was actually 18 years old, while another deal died over a 6 month discrepancy in the age of the furnace. Another fell apart when the seller signed back an offer to close on the same date that was the anniversary of a death of a family member and was taken as a sign that this “wasn’t meant to be”.

Often the argument is just an ego thing where the buyer and seller just don’t like each other and dig their heels in but other times it is the telltale sign of something larger. Our job is diffuse the anger and turn it into a positive. Here is my example; Once I went on a listing presentation on a condo. The exact same unit on the floor directly below sold for $365k. I suggested to the seller that if we listed at $369k we might do a little better (being one floor up). The owner was insistent on listing at $379k so I thought, sure why not. It’s not wildly off base. After a few weeks we got an offer for $375k so being already $10k ahead I pressed my seller to accept. She wouldn’t. Insisted on the full $379k. We couldn’t make the deal work and the seller walked. So clearly my seller lost on a great opportunity….or did she? About a month later the seller listed with someone else at $379k and the condo sold way over in multiple offers. In effect, it turns out the original buyer lost. There is a lesson in here somewhere.

Clearly buying or selling a home is an emotional experience. Both sellers and buyers think they hold all the cards. Getting them together is the real trick. If you hit this critical impasse the first thing to do is isolate it. Is this a buyer getting cold feet or a seller who’s just not ready to let go? Knowing the true motivation will help resolve the issues. Sometimes however, people are just stubborn jerks. Other times you step up and buy them a new microwave. In the end, the buyer and the seller just want to know that someone cares. Finally, I heard from one friend who tells it like it is. His client was his wife. Many years ago she dug her heels in when there was only a $200 difference between her and the seller. The agent husband managed to get the deal together and it has been their matrimonial house for 20 years. He loves to tell the story about how she almost let the deal die over $200. Hilarious.

mark mclean is the Broker/Manager at the Bosley Real Estate Queen St W office and President-Elect for the Toronto Real Estate Board. The opinions expressed here do not reflect the opinions of TREB or Bosley RE.

9
Mar

Woo Hoo. I’m The Client’s Second Choice.

agent number 2
A few weeks ago, at our regular Mastermind meeting, we were talking about how an agent managed to sell a client a new home. This wasn’t all that surprising until the agent told us that the client had worked with a few other agents before who without any success. So the conversation turned towards a discussion about why the first few agents couldn’t make a sale. What was it that made the client stop working with one agent and eventually buy with another?
Some of the answers were pretty obvious…that agent didn’t know the area, that agent wasn’t available on the client’s schedule, or that agent didn’t understand what the client was looking for. But to get more great answers I consulted the great oracle itself, Facebook’s Real Estate Corner. There I got a few to add to the list. Here are some of the best.

I made myself more available.
I made an effort to take the clients out more often, even when there wasn’t much to see.
I gave the client more information than what was on the listing.
I returned phone calls, texts and e-mails quickly.
I listened and didn’t waste their time.
I am more accessible.
I was truthful about a listing.

Now, to be fair, agents lose clients for lots of other reasons. It’s not always about failing at the job. I was reminded of a very good agent in my office who had long-standing relationship with a buyer client. After months of showing properties, the agent figured it wasn’t going to happen so she passed the lead on to a new agent who ended up selling the client a condo in about two weeks. Turns out the client never really liked the first agent and was thrilled to work with an agent who could devote more time and attention. Simple.

There’ an old saying about being the first love, second wife and third real estate agent. There’s probably some truth to that (well at least the end of that anyway).

mark mclean is the Broker/Manager at the Bosley Real Estate Queen St W office and President-Elect for the Toronto Real Estate Board. The opinions expressed here do not reflect the opinions of TREB or Bosley RE.

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