While some things never change in real estate — like broker babble in listings — other things, like technology, are constantly updating.
And some members of the industry are finding it hard to adjust to their changing role.
Executives from several tech-centric companies within the residential real estate industry broke down what new technology is doing for the business — why those slow to adapt should get in the game, and whether or not new technology will take away jobs.
The group from a panel discussing the impact of technology on the residential real estate market at the NYC Real Estate Expo last week at the Midtown Hilton agreed that technology has evolved into a crucial component for brokers in the industry.
Chuck Hattemer is the co-founder and CMO of ONERENT, a platform that manages the rental process for owners and tenants.
“A large change that’s happening in real estate that we’re seeing, is that companies are becoming more proactive rather than reactive, and that’s a huge opportunity to really deliver a much higher standard of customer service to property owners,” said Hattemer.
Hattemer discussed how communication breakdowns in the business, often between property management and landlords is causing “horror stories,” like management finding out a landlord placed a random tenant in a property and they have no idea what the lease says or what the rental rate is.
“There’s a huge lack of transparency in the industry, and for that reason it’s extremely fragmented,” he said.
Hattemer’s goal with ONERENT is to bring more efficiency and productivity to the property management experience, by implementing technology through different pieces of the process. One of those is providing on-demand showing, where a prospective tenant can schedule an apartment showing online, at any time that is convenient for them, and someone from management will go and meet them. During or after the showing, they will get a text message asking them for feedback, which goes straight to the owners dashboard.
Marshall Cox is the CEO and founder of Radiator Labs, a company that turns existing radiators into smart and energy-efficient heating systems that can be controlled by smartphones.
In doing research, Cox found that in aging buildings, investigating what the problems are can often be more costly than not fixing them at all. That’s what his company is hoping to change. By fitting radiators in older buildings with high-tech devices that collect data in real time, they can quickly identify what issues there are.
While in graduate school at Columbia University and living in housing that constantly overheated, Cox got the idea for a device that would reduce radiator overheating and give more control back to the tenant.
The device, called the Cozy, is an insulating enclosure that fits over a radiator that drastically reduces emissions, gives control of the heat to the tenant or management, and increases the value of the home. The system is fitted with sensors that provide detailed information on radiator performance and steam system health via a dashboard.
“We think in general data is one of the missing links in a lot of these older structures with problems,” said Cox.
With all the new advances that are helping to streamline how owners, landlords and brokers do business, why are some veterans of the real estate business so slow to embrace new technology?
“The younger folks, it’s all they know, and the more technology the better, but some people are set in their ways so they feel it’s going to be overwhelming and it’s going to take them away from what they do,” said Robert Mannino, vice president of business development for OptelBCS, an IT support service. Many also feel that it won’t benefit them financially, and would cause more trouble than it’s worth, said members of the panel.
“Real estate is probably the most archaic industry in terms of processing, with the possible exception of healthcare and the federal government,” said Rick Sharga, executive vice president of Auctions.com, an online marketplace for buying and selling real estate.
“In the case of real estate, it’s partly because where there’s money that changes hands, people will resist change if they think it will affect them financially, and people are afraid of about what the impact of change will be on their role.”
Sharga’s company brings transactions online, and from what they’ve observed both in commercial and residential real estate, the industry is only in “phase one” of the evolution of new technology, what he calls the “informational phase.”
“It has had an enormously disruptive effect on how agents work,” he said. While it used to be that the only way to find homes on sale was to contact an agent, through the internet, data is available everywhere, so the call agents get is to help a client go see something they already know about.
“The practitioners who had control of that process over the years, feel like they are being infringed,” said Sharga. “We believe realtors and brokers will always have a role in the transaction, but that role will change from controlling the transaction to being someone who helps clients interpret data and make informed buying decisions.”
When asked whether they believe people in the industry will lose jobs because of technology advances, most of the panelists said yes; but they also agreed that new jobs could emerge in the wake of high-tech innovations.
However agents’ role may have changed over the years, and no matter how slow people in real estate may be to adapt to new technology, if it’s already there, it’s worth knowing how to use it.
“You can have all the tech in the world, but if you’re not trained in how to use that effectively it becomes somewhat useless for the agents beause they’re just overwhelmed with all these apps and different programs,” said Reale Rose, principal broker at FEEDER Real Estate, which focuses on optimizing the mobility of its agents.