Homebot recently unveiled a new feature in its home-equity management app that’s been bothering me.
But I’ll get to that.
If you’re not familiar with Homebot, it’s a consumer-facing “home-wealth management” app that won $25,000 from Realogy in its 2018 FWD Innovation Summit.
Focused on agents and lenders, the app provides a stream of information on how to best manage the wealth in a person’s home.
Aspiring buyers or current homeowners can opt in to an agent’s (or lender’s) stream for all kinds of content about equity, cash-out programs, the current homebuying market, and essentially anything relating to managing the home as one would liquid paper assets. Along the way, the agent is positioned as the informed source.
Sign-up can be done by lead-capture landing pages, social promotion and email. Or, people can be invited by another homeowner or buyer already on an agent’s list.
Homebot is sharp-looking software dressed in a Wall Street-friendly user interface. Think dark, bold colors and line graphs instead of soft graphics and CRM-type iconography. Like looking at a stock app.
The new feature in question involves iBuyers. Specifically, it allows homeowners to see how their offers would compare to the open market.
Considering the app’s primary customer, I found this to be an odd feature to include.
However, it encourages the agent to step in, to steer the conversation and be upfront about the pros and cons of each.
Still, it can be argued that this feature somewhat diminishes the overall value it’s pitching to its agent and lender partners.
The branded monthly updates, landing pages and alerts are designed to keep the agent front and center, away from prying lead sources and, most certainly, iBuyers.
I expressed my concern to Homebot CEO and Founder Ernie Graham.
“That’s a good question,” Graham said to me over the phone. “I think it starts with all the money being thrown at marketing terms like ‘Instant Offer’ or ‘Free Offer.’ The popularization of that vernacular by Opendoor and Zillow and Offerpad is important; they’re spending a lot of money on it, and we think agents should benefit from it, too.”
Graham added that its also about homeowner engagement.
Zillow’s Zestimate became so critical because it gave a market, that at one time didn’t think much about home equity, a way to always take the pulse of homes’ values. And, as we all now know, it became a remarkable lead generator and the spark that launched the industry’s breakneck race to digitize.
I see how showing a seller the discrepancies between deal models stays true to Homebot’s consumer value proposition of providing insight into the financial merits of homeownership, especially in light of the fact that iBuyers pay less for homes than the open market.
According to a July, 2019 Marketwatch.com report on iBuyer sales, “multiple transactions involving iBuyers shows that their offers would net their customers, on average, 11% less than owners who choose to sell their homes on the open market, when fees and other costs are considered, translating to tens of thousands of dollars lost.”
“We say that about 83 precent of a person’s wealth at retirement is in home equity, so why not position agents as advisers to that wealth,” Graham said. “With all the money in fintech and apps that help people access the cash in their homes, it’s important for agents to remain a part of the conversation.”
There are plans for Homebot to eventually facilitate connections between agents and iBuyers’ partnership programs, which will allow agents to remain financially connected to their client in an iBuyer deal.
“We want agents to be in the best possible position to help their clients, even in an iBuyer situation,” Graham said.
Graham also envisions his app as a tool for protecting consumers from another sudden market crash.
“Consumers don’t feel like they have control over their home’s destiny, but they do,” he said. “We’re providing consumers the info they need to not be caught off guard again.”
After Graham and I chatted, he from a cramped privacy pod in O’Hare International, I realized Homebot is simply helping agents broach a topic they’re afraid to talk about with customers.
Yes, Mr. and Mrs. Homeowner, there’s another way to sell your house, so let’s look at your options.
This is a prime example of how technology companies often help their market before their market knows it needs it.
How much better off might the entire industry be today if it found ways to embrace the Zestimate instead of collectively praying for its slow demise in a she shed fire?
Instead of fighting the future, agents should seek technology partners that will help them become a part of it.
Homebot is one of them.
Have suggestions for products that you’d like to see reviewed by our real estate technology expert? Email Craig Rowe.