Ready Player One – What’s real is Real15 Oct Rick Orr
Have you ever walked a home the second time with a client and it just all clicks? Perhaps on the first showing day you all liked the home, it struck a chord but your client hadn’t really let themselves fall just yet. Tense, nervous energy was clouding what was otherwise obvious. You return for that second showing after hammering the pavement to explore all of the potential winners. You pop open that blue lockbox, turn the key and gently usher your clients forward. The noise from weeks of searching falls away, you observe your client’s posture change, their focus sharpens as does yours – this is the house, an offer needs to be drawn and you are going to win this deal for your client.
I sit here strapped into a compressed tube at 36,000 feet having just viewed Spielberg’s Ready Player One for a second time. Much like it ‘clicks’ the second time you view a listing with a buyer when the noise falls away, as did it ‘click’ for me with this movie which, perhaps, is the ideal metaphor for what’s happening with our industry (as well as all other enterprises for that matter). We are engulfed by the game, allowing it to gate us from the real world that we service as real estate professionals and technology vendors. If you haven’t watched the movie, allow me to provide a brief overview (spoiler alert). Essentially, this magical virtual world called the Oasis was built by a benevolent and introverted engineer. Those in the real world can be whomever they wish, fight anything you could imagine, play any game ever created or even fall in love with another avatar. I digress, it’s a really fun movie with an important point – the Oasis isn’t real, only real is real. It’s from this rather simple point that I think we can draw an important corollary to the real estate industry today.
What’s real is real – software is here to help accelerate a search that once took weeks longer due to data controls and scheduling logistics. Software is here to help make agents 2, 3, 5X more productive than they have ever been, allowing them to be more focused when they're with clients in the real world. Like the movie, our clients can fall in love online but they demand a real tour before it 'clicks' that they need a real life professional to guide them towards a life-stage purchase such as a home. Herein lies the challenge - where do we draw the line? Where does the virtual world end and the reality of a major purchase decision begin?
Things are changing, it’s undeniable and it will happen faster than you think as we progress down the path. Commissions are compressing due to new business models and even though there are likely more talented agents than those who seek out more financially secure, employee-status salaried options, the precedent has been set and heavily marketed 1% listing ads and 1.5% rebate models are seen in all major markets now.
When commissions compress we will see a tipping point where part-time agents can’t score that one deal per year at full commission and, thus, the number of agents will drop drastically, which is net-good for the industry in my humble opinion. iBuyer platforms will encroach on the agents who once depended on their investors to use them on each flip or turnkey investment. The moniker of ‘tech-enabled broker’ will continue to be ambiguous and those claiming such will continue to be, well, mostly wrong. Even with new players, history tells us that well-funded brokers will languish as they try to support an insanely low-margin brokerage business alongside a technology company with decidedly different cultures, goals and ideas for what ‘disruption’ means to real estate and real estate tech. Even more distracting is that most are growing through acquisition of extremely old firms with little-to-no background building or incorporating helpful tech.
As a tech geek, real estate software entrepreneur and 20-year Realtor, this is really, really FUN! These are times of alchemy when mutations happen spurning forward new models and breaking down the walls of bureaucracy and frankly, almost paralyzing fear that has hindered advancement in this gigantic space before now.
In the end, the tech-empowered agent will flourish if she embraces the opportunity to have her clients collaborate and communicate in a real-time, MLS-driven virtual world that provides context and data-driven calls to action in the real world where great Realtors have long proven their value. This is the foundation of what we have developed at RealSavvy to make it easier for agents to work with clients - it's a fascinating time to be out in front of this tectonic shift and we are working on the technical implements that will transform the way agents work with their clients in the digital and real world.