I was fortunate enough to attend T3 Summit this year, a mastermind for residential real estate industry CEOs. The two-day think tank was lined up with incredible speakers; CEOs from some of the largest and most innovative brokerages, technology providers, and real estate marketplaces. It could easily be said that the seven main speakers are currently the most influential people in residential real estate. Listening to each speaker, it was clear that these seven CEOs disagreed on a lot. But here are two topics they all agreed on.
iBuyer options are being introduced to more markets and more platforms, allowing consumers to sell their home directly to a company, whether it is Zillow, Redfin, or Compass. This will enable homeowners to sell quickly and without an agent, benefitting people who must move or get rid of a home without delay.
The speakers at T3 Summit agreed that these iBuyer programs are going to impact a percentage of a percentage of the market. What does this mean? High-end listings will not be affected by this technology; it is too risky for an app to estimate the value of these homes. But, a percentage of lower-end homes will use the iBuyer route.
It’s estimated that between 5-15% of the lower-end market will use iBuyer options. These will be homes that are easy to determine the value of, for example, a three bed, two bath home on a postage stamp lot.
This leads us into another topic the speakers all seemed to agree on: technology, AI, and Big Data will impact the lower end of the market. Large companies and brokerages are all in a rush to get this data.
For real estate agents, this makes lower-end listings more vulnerable. Robert Reffkin, CEO of Compass, feels this way so strongly that he said if you are operating in a marketplace that deals with homes under $500,000, find a new marketplace. He believes technology and data will eventually eat up the low end of the market.
While the lower-end of the market may be vulnerable, no one is saying the agent is going away. But the real estate industry is changing, and with that, agents need to continue to alter their role.
For more on my summary of the T3 Summit, watch The Real Word 071.