- Technology is about to hit real estate brokers like a nuclear bomb.
- Most brokers believe that no technology can ever replace them.
- It's time for brokers to set the same tired websites and search functions aside and innovate.
Technology is about to hit real estate brokers like a nuclear bomb. Zillow and every other tech innovator in the real estate industry are so far ahead of brokers at every level that you have no chance of holding your current status and business model more than another three years.
Let me show you what Zillow sees (and makes the company laugh) when it stares at real estate brokers’ so-called technology.
(Upfront disclosure: I don’t build websites, so this is not an advertorial to help you with such. I’m just staring at these websites from the technology perspective that Zillow might take.)
While researching the top 10 real estate brokerages (based on sales volume and as published in a well-known paper with national syndication — yes, to sell them the technology I do have), I got to see what Zillow sees — and it was a shock.
Understand, I’m coming out of a cave to do my evaluation of technology used at broker sites. For about 12 years, I was strictly an REO broker: Fannie, Freddie, Wells Fargo — and about a dozen others. I had nearly zero exposure to regular brokers, their technology or their websites — and I just didn’t care.
During the past three years, I’ve had my head buried in my own crazy-stupid-impossible tech project. I can honestly say I have paid no attention to other brokers — and certainly not their sites — for about 15 years. I did have to use my local MLS system, which is itself a sad commentary on broker technology.
This quick review is of the most successful brokerages in a large metropolitan area, and I expected far more investment in websites. I was wrong.
Tech and impressions of the top 10 brokerages in a major metro
I looked at the top 10 brokers’ websites, and here is what I saw:
No. 1: Basic IDX-based site with a standard home search using city, price and bedroom count and a slider of their listings on the front page.
No. 2: Almost the same as the first in form and function, but without the listings slider.
No. 3: Again, the same structure and function as the first two. These all had the new-style templates — you know, with the giant picture of some multi-million dollar home taking up 90 percent of the screen — sometimes with a looping movie effect. Yippee!
The search technology offered was IDX-based from 15 years ago. I’ve missed nothing; Zillow must laugh.
No. 4: These guys specialize in the $1 million neighborhoods — with the same cookie-cutter template as the first three.
To demonstrate how little they care about even the simplest of technology, though their entire multi-office leadership team has their sepia style professionally taken portraits — with just the right chin angle and glint in the eyes — not one of their posted email addresses work; they all bounced.
This problem runs from the owner and through each location’s managing broker.
No. 5: Same cookie-cutter template.
No. 6: Same cookie-cutter template (but these two are the old-style without the nearly full-screen looping videos of multi-million dollar homes — just ugly, old-fashioned link buttons and fields.
The sixth-largest brokerage owner’s personal site was built in the late 1980s (circa) — I think.
Oh, his email at his site bounced, too.
No. 7: Same IDX stuff. Maybe I’ve missed nothing at all in 15 years.
No. 8: Whoops, these guys changed their URL and forgot to forward the old to the new. Not a brilliant plan once you get published as the No. 8 brokerage in the metro area — with the old address.
I found the new site, and because this group was the first to offer an automated valuation, I just had to click that button.
Well, at least they have cutting-edge technology at their site — albeit somebody else’s.
No. 9: Same.
No. 10: Same.
Remove the logos, and you really can’t tell one site from the next. Nobody offers any kind of technology that did not exist during my pre-cave period.
Zillow must be stunned that no one in entire real estate industry even tries to compete with it.
The sad truth of the matter
All of the top 10 sites are the same, boring, IDX-based, broker-centric displays, with the same tired series of broker headshots and vague promises of being the best.
That’s it — the top 10 brokerages in a major U.S. city — the cream of the crop — and this is the best technology we brokers have to offer the marketplace.
That’s just a superficial glimpse of how Zillow views brokers. When considering Zillow tying together a full national database with every home’s data, complex valuation algorithms, forthcoming home search based on AI designed algorithms and having virtually the entire adult population of the United States coming to Zillow for guidance — how do you think the company perceives brokers’ tech offerings in the marketplace?
Most brokers honestly believe that they are so vital to the disposition of real estate that no technology can ever replace them. But many of the segments of the process have moved toward technological automation. That’s a nuclear warhead coming at you.
The turkey’s fate
There’s a fun little story in Nassim Taleb’s “The Black Swan” (you should read this book if you have not done so) about how civilization in general (and various industry “experts” specifically) watch how things move along over time.
They usually draw the conclusion that everything will continue pretty much as it has.
Then one day, all of a sudden, a massive and perhaps deadly change occurs that no one thought would ever happen based on simply watching how things had been rolling along for perhaps a very long time (think of the worldwide economic crash from 2008). Enjoy Taleb’s story.
The uber-philosopher Bertrand Russell presents a particularly toxic variant of my surprise jolt in his illustration of what people in his line of business call “the problem of induction” or “the problem of inductive knowledge” — certainly the mother of all problems in life.
There are traps built into any knowledge gained from observation.
Consider a turkey that is fed every day. Every single feeding will firm up the bird’s belief that it is the general rule of life to be fed every day by friendly members of the human race “looking out for its best interests,” as a politician would say.
On the Wednesday afternoon before Thanksgiving, something unexpected will happen to the turkey. It will incur a revision of belief.
Consider that the feeling of safety reached its maximum when the risk was at its highest.
But the problem is even more general than that. It strikes at the nature of empirical knowledge itself.
Something has worked in the past, until — well, it no longer does, and what we have learned from the past turns out to be, at best, irrelevant or false — and at worst, viciously misleading.