- Make sure you set expectations about what will happen if your buyer doesn't like the house in the flesh.
- Remote homebuyers can change the market -- they often have fewer contingencies.
- Keep a detailed file of all your clients likes and dislikes so you know when a home ticks all the boxes.
Read more about sight-unseen buyers and what motivates them.
Michael Smith, the regional president of Berkshire Hathaway HomeServices Professional Realty in Greater Cleveland, was one of Matterport’s first clients. In his quest to capture unique vantage points for his own clients, he has been known to attach Go-Pro cameras to dogs.
They stopped a lot to sniff, so all remote viewers saw were closeups of grassy verges.
Smith is a prime example of an agent who has really taken the latest visual tech and run with it to help his out-of-town clients decide which home to buy.
He said he has seen two deals in the last year with remote homebuyers, and he is doing everything he can to win more clients in this area.
Smith helped the incoming manager of a local company buy a new home on a large piece of wooded land for $450,000.
“It was the highest-price home that sold in the last five years, and it sold sight-unseen,” he noted. The average sales price in the area is $89,000. Anywhere else, the home might have been worth $1 million, said Smith.
Providing neighborhood tours and becoming the expert
The agent has also done a neighborhood tour using a combination of Matterport, a drone and a GoPro camera strapped to his head while riding a bicycle through the streets.
“It was like making a movie, making the video, cutting it and editing it — it made the neighborhood real,” he said.
He did the something similar using a golf cart in a golf course community. He is also working on virtual parade of houses for a home builder. (Let’s face it, Smith might be a Scorcese of real estate.)
His message to agents who haven’t done a lot of business with remote buyers is to package all the relevant information together and to prove that you are an expert in your area.
“If you want to specialize in remote buyers — pick a neighborhood or community and have all the data,” he advises.
Smith is proactively seeking business from major corporations who are bringing people to Ohio and may want to buy before they arrive.
The regional director recently did a sight-unseen deal with an American Greetings senior executive coming to the company’s new head in Westlake, Ohio.
In his spare time, Smith builds houses. He was giving the manager a 3-D walkthrough of his new house, and the client put an offer on it. “It was on the market for 24 hours!” said Smith.
Spatial tagging ‘will change everything’
Smith said new spatial tagging to be introduced soon, such as Matterport’s Mattertag, “will change everything” when it comes to touring homes.
Matterport’s vice president of enterprise sales, Jeff Harris, said these spatial markers will help agents highlight special features through the home, from a top-of-the-line oven to a view at night.
Harris thinks buyers who can’t make it to an open house can really get context from the “dollhouse” view in Matterport. “You can rip off (each level) and isolate each floor, which you can’t do on-site. This provides total context to remote buyers — they can feel very confident and feel like they have been there,” he said.
Contingencies matter, too
Of course buyers who aren’t physically present in the location where they’re buying want tech tools to help them understand what they’re getting — but it’s also important to manage the transaction.
Josh Tucker, Anchor Real Estate broker/managing partner based near Charlotte, North Carolina, does up to 10 transactions a year with buyers who are buying sight-unseen.
He always asks for a contingency period to give his clients time to see the house after the offer is made, and his clients are prepared to pay for this.
“We need to act quickly — they know they are risking their due diligence money, so it becomes a matter of, ‘Are you okay with risking $5,000 to lock this house up before you can come to town and see it or take the risk and find it’s gone?'” He said most of them risk the money.
Tucker, who sells luxury homes around the Lake Norman area to a network of NASCAR and athlete clients, has a home under contract right now with a NASCAR crew chief and his family who have not seen the house yet.
“We do have a 15-day contingency period in which they plan on looking at the house in person after returning from Daytona,” he explained. “They will be allowed to terminate their contract in the event they don’t want to move forward with the purchase, but they have put up $5,000 of non-refundable contingent money upon contract execution.”
He’s hopeful they will like the house.
Showing a home from afar
Tucker, a former NASCAR crew chief himself, said his “NASCAR people” travel 40-plus weekends a year which doesn’t lend itself well to house-hunting.
Fortunately, Tucker is an enthusiastic techie who likes to roll his sleeves up and help his, often remote buyers, visualize their future home through a variety of tech out there. He also uses Matterport to scan properties and send clients virtual walk-throughs.
However, the family had some questions about the exterior — which Matterport couldn’t answer. “So I just used FaceTime on my iPhone and walked the exterior of the house with them, showing them certain things of interest through video,” Tucker added.
“Those two tech tools were enough for them to risk $5,000 non-refundable and execute a sales contract,” he said.
Better Homes & Gardens broker/owner Jeff Farmer and his wife, Steffany, who are based in Savannah, Georgia, have used the ReaLync app recently with an out-of-town buyer interested in a vacant home. They liked the idea of a live streamed video which could be shared with other parties.
Farmer sets the scene: “At the time of the video, the wife was in Arizona, the husband in Alabama and the house was in Georgia.
“We started our tour and were able to talk with the wife while we videoed a street view of the surrounding houses as well as the exterior and interior of the house on the market.
Once the husband was able to view the recordings, the husband and wife decided to buy the house.
“The couple did eventually travel down to see the property while the contract was being negotiated; however, they were willing to purchase the property based on what they were able to see on the video,” said Farmer.
During ReaLync live tours, the attendees can also view an interactive Google map of the area, capture photos and take notes. All of this gets saved and recorded to the cloud, according to ReaLync.
“It’s one of the big reasons we came into the market place,” said ReaLync co-founder and CEO, Matt Weirich. “We felt online options were not telling the full story of properties and communities. Real estate is still predominantly based on still photos — it doesn’t instill trust and transparency.”
Live streaming video seemed like a gap in the real estate market place, he added.
Showing a neighborhood from afar
Tucker likes showing a neighborhood with drones if someone is unfamiliar with an area or if it is a lakeside property.
“I have done one where the home was outside of the neighborhood they had in mind, but they seemed to like the house,” he noted, “so we instead of putting the drone directly above the house, we flew it above the grocery store, the marina, the restaurants, so they had an idea of how it was all laid out.”
He’ll sometimes use a helicopter with a heli-videographer, too.
Surefield CEO David Eraker, a Redfin co-founder and tech entrepreneur, is watching the sight-unseen market carefully. Surefield’s virtual 3-D home tour claims to be the first and only service to show the entire home — inside, outside and an aerial view.
Based in Seattle, he confirmed Surefield agents have had offers from buyers — particularly international buyers from China who have not seen the property themselves — but no completed sight-unseen transactions have happened yet.
“The technology that has evolved has made it more possible than ever to buy a house remotely,” he said. “With Google Street View you can walk up and down the street and get a feel of the neighborhood. There is no limit to the amount — you can walk blocks and blocks.
“That works for foreign buyers and investors. We also see it working for local buyers who would rather jump online than get in their car and drive over there.”
Eraker points out that drawing on social media is another way for remote buyers to get to know what’s going on in a neighborhood.
“It is easy to find photos, events, venues, schools, the amount of information available to buyers across the country, in another country or the next neighborhood, is growing.”
Study your buyer
Tucker said he closely studies his buyers who may well end up buying remotely.
As well as spending a lot of time up front either on the phone or in-person when they are in town, he takes them through houses when possible and takes note of what they do and don’t like. “I go with a recording device,” he said.
All their comments are put together in a file on their requirements.
When buyers pull out during the contingency period, it is the little things that put them off, said Tucker.
A water view might not match up with expectations, but usually the interiors don’t meet up with a buyer’s expectations them to — it’s rarely anything to do with the location, he said.
“We use Matterport and so on, but there’s nothing like walking in yourself,” he conceded. “Sometimes it is the view from the inside of the home out — sometimes it’s hard to show a view from inside the house.”
It’s about setting expectations upfront, he said.
And depending on your buyer, you might want to adjust your own behaviors. Simon Henry, co-founder of Chinese property portal Juwai, has some suggestions for agents looking to help Chinese buyers from afar.
“Treat the buyer’s local representative with respect and helpfulness, even if it’s just a young, local relative,” he advises. “Buyers will often send a university-age child, niece or nephew who happens to be in the U.S. to do research for them, while reserving the final decision to themselves.”
Make available as much information about the property and developer as you can that might reassure a buyer, he said.
“Emphasize longevity, size, expertise, quality and past successes,” he added.
“Highlight things that might add value, such as nearby schools, universities and positive local economic prospects.
“Provide information on prospective capital gains and yields and back up the projections with as much detail as you can, to make them more trustworthy.
Finally, said Simon, “Communicate clearly and often via social media, email and the phone. Don’t overlook the power of your phone to help you make a connection with a China-based buyer.”