Key problems include:
• Poor communication and a lack of transparency of the process;
• Blind bidding wars and a lack of transparency across the process;
• Buyer and seller fatigue because of the time it takes to find or sell a home, have an offer accepted and go through the whole settlement process without a clear road map;
• Delays in settlement that can totally derail all your work to date finding a property;
• Inefficiency in inspecting properties – contacting agents, the hassle of attending or setting up opens;
• Transaction management, especially moving to a different state because laws are different;
• Handoff points across the buying cycle and settlement – you, your agent, the seller, the conveyancer or the bank – anyone can and regularly does drop the ball which results in delays;
• Lack of knowledge by buyers and sellers which can lead to dropping the ball, poor communication and transaction delays; and
• The emotion of the experience and importance of the purchase of buying a home. It is rarely recognised and leads to buyers and sellers feeling stressed and overwhelmed.
What was interesting from the conference is the realisation that solutions to many of these pain points already exist in the market. It’s just that no one has brought them together in a meaningful way. A shared vision around what an ideal transaction looks like is what is missing.
Here’s my take on what the future could look like*:
AI will improve my real estate search
When I log on to a real estate search site to look for my perfect home, bots in the background will identify whether I’m looking at buying or selling, and combine that with knowledge about my other web-browsing activity to help direct me, and serve up to me, better property options that I may not have thought to search for directly.
My activity will result in me being served unique content that’s easy to consume
I’ve been hunting for property, which means the algorithms watching my browsing behaviour start to push content to me that helps me research the suburbs I’m interested in, property data insights that I may need and of course, properties that fit my criteria or perhaps even stretch it a little bit to ensure I don’t get confirmation bias.
This will be served in the form of links, automatically generated reports or easy to understand videos that make it easy to learn about the market I’m entering. It also includes virtual reality experiences that allow me to explore a neighbourhood without leaving my living room.
Bots will match me to an agent and a mortgage broker/finance solution
Using my social media information, location and other preferences that are revealed by my online searches, bots will connect me to agents and brokers who are well-matched in terms of experience and behaviour/style that I feel comfortable with. This will help me quickly choose someone to place my trust into and I’ll be able to easily assess/shortlist them by checking out their credentials online. Having access to my social data online means my broker/bank can do me an even better deal because they can see key data points that I’ve approved such as employment status.
My mortgage broker will give me VIP status
I connected to a broker early on, and they have now confirmed the amount of mortgage I can borrow and classify me as an ‘approved buyer’. This status elevates me in the digital world with real estate agents and flags me across the ecosystem as someone who should be taken seriously when I inquire about a home. This gives me special privileges such as the right to private inspections, and deals with conveyancers, moving services and utility connections when the time comes to move.
Bots will work for agents to streamline early buyer conversations
When I reach out to an agent to inquire about a property, chatbots on their site will help answer basic questions whatever time of the day or night that I contact them and recognise my approved buyer status. This will help me refine my search and quickly cross unsuitable properties off my list or refine my search with other properties I may not have seen. The bots will also be able to book me in to an open for inspection, after syncing with both my calendar and that of the seller to make sure the time works for us both. They will also serve me up links to virtual reality tours that let me do what feels like a live walk-through of the property. This also helps me cull properties from my list. The bots help agents deliver great customer service without having to be online 24/7 and streamline the whole process.
Bots will work for agents to create reassurance for early seller conversations
My first interaction with my agent as a seller is also likely to be a bot. The bot will collect key data points to save me filling in forms. The bot will also share information with me that is targeted to my queries and helps me understand the process I’m about to go through. It also creates a personalised road map of my selling experience so I can see how far along we are at any time.
My agent inspection helps me resolve issues prior to selling
When my agent visits my home for the first time, they create a list of property issues that are likely to affect the sales price of my home. I have the option of allowing this list to become a tender document and my agent manages the process of local tradespeople who bid to complete the work that I can choose to have done before I go to market. Alternatively, the items on the list can be made available to potential buyers to see exactly what is required to correct any faults on the property. Being transparent in this space becomes part of my transparency rating and this improves the ranking of my property in the eyes of buyers.
I virtually visit most properties I’m interested in
Losing your entire Saturday to visit properties is a thing of the past because I’ve been able to check out most properties on my shortlist using virtual reality. Developments in VR mean I’m not just doing a walk-through. I have a real sense of the proportion and space in the rooms, and the flow of the property. I can do this from the comfort of my home and still pick up the kids from soccer.
When I visit an open home, my mobile automatically checks me in
This provides a great data stream to agents to let them know who is serious about a property. It tracks my movements and flags which rooms I spend the most time in so the selling agent can proactively follow me up. I also have access to this data and it helps me keep track of each property I visit and makes notes of any issues that concern me. I can forward this data to my building inspector for them to use as a guide when they inspect the property and to my solicitor to advise them of issues that I want them to check in the contract if the purchase proceeds.
Inspections are now cheaper, quicker and centralised
We no longer lose days or weeks – and thousands of dollars – on finding a property inspector and coordinating time for him (or her) to carry out the inspection. Based on my online behaviour, I receive alerts advising me if a property inspection has already been carried out that I can bid on or purchase outright. The property inspection process is also a lot faster as most agents share their inspection reports, and trades and services quotations which creates a much more comprehensive report. Inspectors can also send drones to inspect properties rather than visit in person, speeding up the process significantly.
Serious buyers are invited to a transaction room
Buyers who are seriously interested in a property are invited by the agent to a transaction room where all parties can see the latest offers. All buyers, and of course the seller, receive alerts when a new offer is made, keeping everyone up-to-date. It acts as a de facto auction and creates enormous transparency. Special terms and conditions are flagged as part of this part of the process too and sellers can see which buyers are pre-approved to purchase and who may have a longer settlement period and therefore need to offer more.
A secure settlement room completes the transaction
Once the home has sold to the highest (or least risky) bidder, the agent invites the buyer, seller, lawyers/conveyancers for both parties and the mortgage broker/bank into a secure settlement room. Here, contracts are shared, digital signatures are collected, and deposits and settlements are collected. All parties have transparency to an appropriate level and receive alerts as the transaction moves from stage to stage, plus clear outlines on what their responsibilities are.
You receive the perfect gift to celebrate
When the transaction completes, an alert is sent to moving and key utility providers, alerting them to your moving day and inviting them to pitch for your business to get you settled into your new home. Your agent also receives this alert and their internal systems match the experience you’ve had together with your preferences and automatically sends an order for a ‘congratulations’ gift that arrives within a day.
Your agent stays in touch
On key anniversaries, you receive a message from your agent touching base, to find out how you’re settling in, and letting you know about property values in your area. It’s a great way for you to keep up to speed with how much your investment has grown and helps reassure you about your decision.
*My best guess based on what I heard.