I arrived at the open house to find potential homebuyers’ cars piled up in the cul-de-sac before I had even put up the open house sign. We asked every person as they entered the open house, did you come because you saw the signs or did you see the home online?
We discovered that 90 percent of the 50-plus people attending our open house saw our online advertising and cited that as their source of information.
Moreover, two things became very apparent at this most recent open house:
- We noticed that only one set of buyers came with their agent
- Most buyers found the home on portals and not from their broker
These findings were contrary to what was occurring when I entered the business in the early 2000s. In those days, buyers needed their agent to find them a house, and buyers sought out agents to find them houses.
Nowadays, the control of real estate has drifted away from the brokers and agents and into the hands of the consumers thanks to portals.
Portals (such as Zillow, realtor.com, Trulia and Homes.com) have created an online marketplace of updated fresh content — all offered free to consumers. The brokers’ mindset earlier in the century was to protect their asset, the large database of home information in their respective area (multiple listing service) to which only they had access.
This approach is the opposite of the portals’ whose vision is to share homes with everyone, in hopes of gaining the trust of the consumer. The portals have won this battle. Now the consumer can get everything they need online without talking to an agent — except the home itself.
Most importantly, consumers can view the upgrades, the condition of the home, floorplan, lot shape and upgrades, and school information — all from their mobile device or sitting at a computer for endless hours forming opinions sans agent advice.
Portals are topping buyers’ searches through search engine
It’s optimization using a most relevant content strategy. Consumers are volunteering their information because the portals are not selling them anything.
Brokers are now the lead machines of yesteryear — providing leads to agents in exchange for large fees. Brokers have not been able to compete with the portals because the portals dominate the search engine optimization (SEO).
Brokers will have to shift to change with the consumer, or they will go the way of the printed newspaper. They will need to teach their agents how to navigate the internet to reach the buyers and sellers who used to walk in the door.
According to Chris Smith at Curaytor.com, online leads have grown 10-fold in the past five years, and brokers will need to teach these new ways to agents as the role of the agent is changing to meet the needs of real estate 2020.
One of these new ways of doing business that needs to be addressed is how much information the buyer can access online about the homes they are interested in.
In the early 2000s, agents would average about three to four photos per house due to photo limits imposed by MLS. Obviously, with only a few photos, there would be one of the front of the home, one of the backyard and maybe a photo of the family room and master bedroom.
Consumers still had to turn to agents to get the rest of the information on the listings. Wth the evolution of technology and the internet, things have changed drastically. Fast forward 10 years.
Now, the phones in the brokers’ offices aren’t ringing like in years past. It’s common for agents to take 30-50 photos of every single room, and the National Association of Realtors puts out statistics that homes with lots of photos sell faster and for more money.
Brokers encourage agents to put floorplans and maps of the listings online, and all of this information gets shared with the portals through syndication, who have the leads pouring in. Oddly enough, it’s not the agent providing the content who get the leads. Instead, the portals that agents pay to get leads profit from the information the first agent provided.
What needs to happen for agents to succeed
What we agents need to realize is that now that the consumers can see what a home has on the inside, they can choose not to come see it.
As I stand inside seller homes, and they complain because I can’t get buyers to come see the dated home — bought 12 years ago — that is priced like a model home, I realize I need a solution.
But that is for another day. Today, I am here to discuss the evolution of the broker because agents need help to figure out the technology and how it’s impacting their business.
Agents have been caught underinformed of the transformation of their industry due the to technological changes and need training to stay competitive that these brokers have yet to offer. Successful brokers need to change their models to educate agents on staying relevant to prosper or discount to stay in business.
Jeff Sibbach leads The Sibbach Team at Realty One Group.
