WHAT REAL ESTATE BUYERS AND SELLERS WANT
While there are plenty of real estate industry discussions and reports focused on consumer trends, demographics and behavior, a roomful of real estate agents, brokers, executives and technologists got to hear firsthand about consumers’ hopes, dreams and fears during a session at the Inman Real Estate Connect conference last week.
Dora M. Abreau, a software engineer, had tried to buy a property via auction, but that didn’t work out. “I don’t have the time to do all the research to know what the market is doing,” she said, although “it’s pretty obvious now is the time to buy — the market is low.”
Economic uncertainty is a very tangible factor in their real estate decisions, said Abreau and other panelists. “People are losing their jobs, and that can happen to anybody. It’s very real. You want to get into a situation where you know you can handle — sustain — a mortgage if you get downsized or not. That’s something factored into where I would live, where I would move and where I would buy.”
Abreau said she started her home-search process several times, and the circumstances haven’t been right. Moves from Chicago to New Jersey, and later from New Jersey to New York, had interrupted previous home searches, and during a search in New York her agent ended up moving to Florida, she said.
While she has met some real estate agents who are a good fit, others have not, she said. Her advice to real estate professionals: “Be upfront and honest.”
And instead of telling consumers, “Oh, you didn’t know about that?” when something unexpected comes up during the home buying process, she advised that agents should be the ones holding the hands of their clients.
“That’s why I’m coming to you,” she said — for professional expertise and advice on the process.
Matthew Cavnar, vice president of business development for e-book publishing company Vook, said a confluence of life events — namely his engagement and a busy job for a startup company — complicated his search for a place to buy.
“We were in a p osition to get a new place … (but) it seemed so painful to work with a Realtor or work in the New York market we just decided to stay in a situation we might not have been as happy in. It just looked so difficult we said no,” said Cavnar, who currently rents in Brooklyn.
While Cavnar acknowledged he is in a position to buy and represents “a valuable lead for real estate agents,” the real estate brokerage model “seems moribund, seems old — not in terms of age but in terms of what I have to deal with — something as specific as all these (expletive omitted) documents.”
He said trust is an important consideration in agent choice. In securing a rental unit, Cavnar said the agent who got the deal done “made himself very accessible and his communication by email” was frequent and good. Even so, the fees make the process “cumbersome and painful,” he acknowledged.
Agents in New York can appear like “walking key” sometimes, he said, noting that he would appreciate it if agents took more time to listen to your priorities and didn’t have a set checklist of properties they would take you to, regardless. “They could have sold me, potentially, a more expensive place,” he said, if they took the time to better understand his needs and wants.
It would also be preferable to him if agents took care to better organize and present properties online for him to sort through, he said. If agent-client matches functioned more like online dating, there might be better fits in the working relationship, he suggested.
“That’s an interesting model … online dating — a way to match myself up with the best profile for me. Fill out this (information), then we’ll do a consultation with you. I would be a qualified lead for that agent,” he said.
E-documents and electronic signatures could also simplify the real estate transaction process, Cavnar said.
Mark Davis, an entrepreneur who buys Nike shoes and resells them in high-end consignment shops around the world, said he’s in the process of closing on a home in Staten Island, N.Y. — he liquidated some of his inventory and is buying a duplex.
Davis used a friend working in real estate to refer another agent, “and it worked out great,” he said. “Every time we looked at a house she had a printout of the house. She got there early. She loved her job. I was never given a reason to look somewhere else (for an agent),” he said.
He said he knew his agent was a fit right off the bat. “When I first met with the real estate agent and I told her I wasn’t in a rush — it might be a year or two — and she didn’t flinch,” it put him at ease, he said. He ended up closing a transaction within six months.
Sally Weir, a retired Silicon Valley tech exec who lives in Northern California, said that when she was seeking to sell, she attempted unsuccessfully to work with an agent friend who was just starting out in the business, and later approached the top-selling agents in her neighborhood.
“They had contacts with companies and incoming executives,” she said, and ultimately her home did sell to a person who was transferring into the area for a job at Hewlett Packard.
In addition to finding an agent with a successful track record, Weir said, “We were looking for a personality fit and just general trustworthiness.”
In terms of cost, Weir said the 6 percent commission rate for listing services seemed fairly static and inflexible in her area, at least with the agents she spoke with. “As a retired person it’s a lot of money to pay,” she said, noting that she paid for staging and painting, too. “(The commission) doesn’t vary based on the size of the transaction, which just seems to be pretty expensive, as a homeowner.”
Like Cavnar, Weir said she believes the industry seemed stuck in its ways. “It feels very outdated, the whole structure of the transaction and the industry — everything from the (seemingly) fixed commission to giant stacks of paperwork that you must initial (on) each and every page.”
She added, “Some of the marketing that is done is just not very professional,” including some unremarkable websites that were “not something that I would want to put out as a quality product.” She questioned whether the real estate brokerage model will face more challenges from technology, in the form of disintermediation.
Weir said she used a two-agent team for her latest transaction, and that worked out well. “If Randy wasn’t there, Pat was,” she said. And her agents were tech-savvy, which allowed her to close a transaction from Heathrow Airport in England. “They were always excellently prepared.”