April 6th, 2015
Technology, especially mobile devices, has changed nearly every aspect of daily life. This trend is starting to affect the housing market. In a recent study from Redfin, American consumers indicated they want a change in the traditional real estate experience. In particular, respondents were interested in lower fees and tech-based solutions. Sixty-nine percent said they wanted to explore alternative options to a real estate agent. The majority of buyers and sellers wanted lower fees.
What makes traditional agents appealing?
Homebuyers and sellers still want to work with real estate agents, but responsiveness was crucial when selecting an agent. Not only did consumers want technology to make the process easier for them, but they also wanted their agents to use the latest devices. Only 31 percent said their decision on a real estate agent was based on quality alone. In fact, buyers cared more about responsiveness than professionalism, local expertise and experience. Sellers were more concerned that their agents had previous experience selling similar homes.
However, buyers were more likely to be satisfied with their agents than sellers. Both groups wanted their agents to fight harder for their interests, and sellers felt their real estate agents could have done more with online marketing to promote their properties.
Millennials changing the market
Generation Y is exhibiting more influence in the housing market, fulfilling both the roles of homebuyer and agents. Millennial buyers don’t want to talk on the phone with real estate agents; they prefer texting, U.S. News & World Report stated. Young adults are starting to gain more purchasing power, making them the next major group of homebuyers. According to the National Association of Realtors (NAR) more than 50 percent of millennials search for homes on their smartphones, and 26 percent of this group purchases a home they found through this channel. Gen Y was especially interested in researching potential homes through an app.
However, millennials’ preferences for technology have proven to be a challenge for real estate agents because many of these professionals are older than the homebuying population they work with. Currently, only a small number of agents are younger than 30, and 81 percent are older than 45, according to the NAR. This makes it more difficult for agents to adapt to the preferred tech use of this key demographic. In addition, many young adults create their own lists of homes they want to see before meeting with an agent.
Providing in-depth resources can help firms connect with millennial buyers. Agents need to understand their customers’ communication preferences and work to offer a more tech-friendly experience to form a strong relationship with younger clients.
While technology is important, it won’t completely replace the traditional experience. Even millennials still want face-to-face contact with agents. According to Redfin, having a real estate agent who is willing to work hard for his or her clients was more important to buyers than a large selection of tech tools.