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Real Time Paradigm Shifting in The Real Estate and Mortgage Industries

By
Real Estate Technology with BoomTown

Real Time Paradigm Shifting in The Real Estate and Mortgage Industries

Very few will argue that we are in the midst of an historical era of change, largely leaving the Industrial Age heading steadfast and firmly into The Age of Information.

Transitions between era’s have traditionally taken anywhere from 100,000,000,000 to 100 years, with each succeeding ‘period’, ‘time, or ‘age’ shrinking rapidly compared to the prior by a factor of ~10.

If the above is true then it’s not contrived to think that we may be passing through multiple periods of relative historical significance during our own life, whereas prior such ‘times’ have lasted for >10 generations.   This is a remarkable reflection if you really consider it. Change is happening at a far faster pace than any of us are used to because it can.

‘The Times’ change so fast they now call it Real Time (as in the time before real time was fake time, or something like that).

Change is also something that does not feel natural thus most don’t adapt to it well, especially over very short periods of time.  Over 10,000 years?  Sure.  Over 5 years?  Maybe.  6 Months?  What just happened..?

People within a society affected by change can be generally classified as:

•    Innovators
•    Adapters
•    Adopters
•    Laggards
•    Haters

The Moral:  Business is moving, evolving, changing faster than ever.  Real estate and mortgage used to resist such rapid change, today embracement is necessary for survival.

It’s pretty well accepted that in the Information Age, withholding information for money has diminishing value.
It took real estate and mortgage (to a greater degree) longer to understand this, which is evidenced by the initial industry aversion to sites like Zillow et al (Innovators).  Many agents understand that wider distribution of their inventory is in fact a good thing (Adapters and Adopters); placing ones product in a place where there are a lot of potential buyers is likely to increases the chances of selling that product.  Other agents are just now realizing and acting on the same (Laggards).

New technologies start big then get smaller and better.
Zillow launched in February of 2006 offering tools and services that draw in consumers and feed participating professionals using intuitive user interfaces (UI’s).  Trulia evokes similar qualities; single site with all the tools (and the list goes on).  To one extent or another Zillow, Trulia et al have exponentially improved the real estate Search experience over the past two years.  They’ve blazed a wonderful path.

They’ve also raised and spent capital that exceeds some Nations GDP to foster a technological paradigm shift towards information transparency coupled with uber-intuitive UI’s with regards to real estate listings, a map and other relevant local data (also called a mash-up).

Today the same tech driven mash-up UI’s that drive gobs of traffic to the Zillows and Trulias of the world are available and affordable to individual real estate professionals (rePros) at pennies on the dollar.

Different Agenda’s
Zillow and Trulia are advertising/media websites.  Their business models depend primarily on traffic so advertising may be sold for a premium and each have numerous vehicles for an agent to spend their money on.

They’re kind enough to offer tools (widgets) that add a coolness factor to an agents individual site and create social conversation forums to leverage participating agents experience/knowledge for the community as a whole.  But make no mistake; they depend on the traffic a rePros personal knowledge and information draws to embolden their respective brands.  Every tool provided is inherently designed to increase their traffic first, yours second.

Other real estate Search sites like Roost will re-skin, redisplay and replace your current ugly IDX then charge you for the privilege of the traffic they direct back to your site. This is certainly a better alternative to what’s been available in the IDX market and more importantly another step towards blending technology seamlessly with an individual rePro’s Brand…yet not quite ‘there’.

In most every case, a top level domain real estate Search portal seeks to profit from advertising and by building their Brand first, yours second.
Roost claims that they ‘Support Your Brand’:

  1. Your brand is prominently displayed at the top of the search results
  2. You receive a virtual card with your contact information and links to your listings
  3. You receive your own URL on Roost

Claim #3, receiving your own URL on Roost, isn’t the highest and best way to support your brand.  This also leads to a similar experience outlined above where a consumer is bedazzled with one slick UI, only to eventually fall into a foreign place called your website.

Roosts business model message:

  • Performance-based and transparent
  • Pay only for the clicks you receive to your own site
  • Target people in specific geography (town, zip code, etc)
  • Buy only as much traffic as you want in any given month.
  • Your Roost dashboard will make it easy to manage your spend and track performance.

Very Googleicious…carefull, if you don’t keep the traffic tank monetized, it’s possible to be the Star one minute and invisible the next.

Where is there?
When consumers begin their quest for a home, they’re after one thing: listings—all of them.  Trulia, Zillow, Roost et al face a perpetual problem with the ‘available to in-house listings ratio’.  Big players in this space like Realogy and Prudential are picking sides, contributing listings to one site or another.   Some agents choose to contribute their listings while the vast majority do not.  This leaves consumers with a choice between bad and worse: Try and search all the listings with inferior tools, or perform cutting-edge searches on ~20-30% of the listings available in a given area.  Thats not an acceptable ratio in my book.  Pretty soon we’ll have an aggregator of the aggregators, and so on.

From Joel at FoREM:

It seems ironic though, with all these brokers now lining up in different camps to feed their listings to the big consumer search destinations on the Internet, that it’s ultimately the consumer that suffers from these alliances being formed.

If I’m trying to search for a house in Portland, I still have to have to go to multiple destinations (Frontdoor has X, Zillow has Y, Trulia has X & Y but no Z) just to get an accurate picture of the complete inventory available on the market.

and Dustin:

Either way and any way, this would be another big win for Trulia, but as Joel notes, Michael agrees, (and I’ve said before), it is note self-evident that at the end of the day, the consumer wins with broker-fed listing sites.

While penning and researching this post, I came across the above snippets and couldn’t agree more:  A viable solution could be a website that hosts robust Search UI’s and engages social networking as well as SEO strategies under a rePros personally owned and controlled domain.

BlueRoof360.com is about as close to ‘there’ as I’ve seen.  The only aspect that I question (and this is being very nit-picky) is the platform that they are using…is it proprietary or open source?  In other words, can I snap pieces in and out?  If I don’t like the property search UI, can I swap it out with a better one?  Can I add plug-ins and other features vis-à-vis WordpressRealivent and Incredible Agent deserve mentions here as well.  

As a rePro on the Listing side of the relationship, if you are going to ‘give’ your listings to the Zillows of the world, your personal website had better be on par with the site that the link came from, otherwise that ‘link’ will likely leave your site and go back to more beautiful and userfriendly pastures.

As a rePro on the Buyers side of a potential relationship, a website with real time information and a solid property Search UI is mandatory for future survival.

RePro’s can offer consumers via their personal websites a vital claim that the big players will always chase:  100% of the information located within a local MLS’ database.  Days on market, sold data, and a glut of other valuable information to consumers that currently is not available on the big players sites can be displayed on a licensed pro’s site.  Regardless if one person (consumer or professional) thinks that such info is important or not is irrelevant.  Someone does, it’s the long tail consumerism that dominates the current and future markets terrain.  In any case, the more information you make accessible the larger your potential audience.  Redfin gets this, they offer their agents and consumers best of breed technology and information.

In case it’s not evident i’ll point out that consumers are getting smarter about how the real estate industry internally works due to this new real time access to information phenomenon thingy.  Better to be deemed transparent and open rather than a shifty salesperson.

To keep in line with change in real time, the best strategy is a likely mash-up of all of the above, sprinkled with a little bit of this and that.

  1. License great looking, highly functional, scalable technology to display your products through, and seamlessly build your brand.  Keep in mind that you get what you pay for, don’t go for the cheapest solution by any means.
  2. Push and maintain your listings with the big aggregators: Trulia, Zillow, Google Base etc for the exposure.
  3. Blog incessantly about topics that are local to your listings.  Need a blog and the proper education to go along with one? Check out The Tomato.
  4. Participate in Social Networks, optimize your Social Networking Optimization.  Participate in conversations on ActiveRain, update your professional profile on LinkedIn, create a group on Facebook.
  5. Seek to learn: Knowledge speaks, wisdom listens…Attend some of the current seminars like 4RealzED, BHBU, and if you’ve got some extra coin, Inman Connect.  I’ve personally been to three Connects, registered for Dustins preso in Orange County on April 17th, and plan to attend BHBU schedule permitting.
  6. Prepare to change, upgrade and sharpen your tools often.  Today’s rage is tomorrow’s fizzle, stay razor while you shine.

Also See:

DarWidgetry…

New Marketing Strategies…

The Effect of Transparency…

Lola Audu
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate - Grand Rapids, MI
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Totally on target post.  The paradigm shift is affecting the language...two years ago, I wouldn't have understood much of what you referred to in this post.  What's scary is that 24 months later, it is still Greek to many in our industry.  Like you say...one just has to jump in and do it!
Mar 12, 2008 09:08 AM
Michael Taylor
Red Door Real Estate - Fishers, IN
Great blog, but I have to disagree a bit.  I think Trulia and Zillow will ultimately not only be about advertising and they have already started charging agents (Trulia's featured listings) for more exposure.  The fact of the matter is they are direct competition for agents who have websites and are or hope to rank in the search engines.  
Mar 12, 2008 09:21 AM
Misty Lackie
Go Smart Solutions, LLC - San Luis Obispo, CA
Real Estate Advertising

Great post and true.

Michael - Trulia and Zillow may be able to rank well for listings, which is one of the reasons you want your listings on those sites.  Just make sure and add a link back to your site on the listings you add to the other directories.  It's going to be tough for an individual agents website to compete with these types of sites for property search ranking because an individual agents site will only have so many listings.  Trulia, Zillow and others have thousands and thousands of listings and thousands are added daily.  Search engines such as Google love sites that have new content (pages) so they tend to index listings on sites such as Zillow and Trulia much quicker then individual agent sites.  Where an Agents site can come out ahead is with information about the area, city info, local real estate info, local house values, etc.

Posting your listings to other popular directory sites will bring lots of traffic to your individual site.  Look at these as tools rather than competition for your individual agent site.

Thats my opinion at least.

Mar 12, 2008 09:45 AM
Monika McGillicuddy
Berkshire Hathaway HomeServices Verani Realty - Hampstead, NH
Southern NH & the Seacoast Area

Jeff...I think I need to reread this post...there is a lot to chew on.  Definitely something to think about especilly when you say "Today’s rage is tomorrow’s fizzle, stay razor while you shine."

 

Mar 12, 2008 10:05 AM
Richard Lecinski
Long Realty Company - Oro Valley, AZ
Over the last 20 years there have been many very big changes. Thank you for your advice.
Mar 12, 2008 10:13 AM
"The Lovely Wife" The One And Only TLW.
President-Tutas Towne Realty, Inc. - Kissimmee, FL

X...Y...Here...

Okay my friend. You caught me on a brain dead day :)

I will have to come back when I am fresh and lovely :)

Right now...I must go sharpen my claws :)

P.S. Ha! Ha! I get 25 points for speed reading your pretty post :) 

TLW...ROAR!

Mar 12, 2008 10:49 AM
Wayne B. Pruner
Oregon First - Tigard, OR
Tigard Oregon Homes for Sale, Realtor, GRI
That's a lot to read and digest in one setting. I skimmed it. I'll come back to this. Thanks.
Mar 12, 2008 11:02 AM
Jeff Corbett
BoomTown - Charleston, SC

It is alot to digest...it started out pretty short and sweet, then I lost control a bit...

Hey Y :) You use those claws often enough to keep em sharp ;)

Mar 12, 2008 11:24 AM
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

The tech tricks are all intersting and fun, but without the basics, the public isn't served.

Seems to me that the more technical we get and the more transparent we become and the more empowered the consumer becomse,

THE WORSE THE REAL ESTATE MARKET BECOMES.

Perhaps we need to focus a bit more on basics. 

Mar 12, 2008 11:47 AM
Michael Sally
Victory Lending Group - McMurray, PA
Victory Lending Group
Thank you for the intelligent, insightful post.  
Mar 12, 2008 11:49 AM
Judy Orr
HomeSmart - Scottsdale, AZ
Scottsdale AZ and surrounding towns

Thanks for bringing me back to Realivent.  I checked it out about a year ago and either they've grown since then or I just didn't spend enough time on their site before.  I'm thinking of bringing one of my long-standing blogs over to one of their blog/sites.  However, I'm not quite sure how to take all of my old posts to make the switch since I've only used Wordpress blogs and just changed the template each time.

I do allow my listings to go to Trulia from my Point2 Agent site.  My main website, Chicago Suburbs Real Estate, ranks higher than most of these competitor sites (my competition is Yahoo real estate pages and Homegain).  But if we keep feeding sites like Trulia I feel we do risk losing our local serps by making them so much stronger.

My sites offer every single active listing in our huge MLS (I believe the largest in the U.S. - MLS of Northern IL).  I do not offer our pitiful IDX but offer VOW - the only way for a prospect to search every active listing in our area.  Even Realtor.com has the opt-out choice for agents so my sites offer what even the big guys don't. 

Mar 12, 2008 11:51 AM
Jeff Corbett
BoomTown - Charleston, SC

Judy...Be sure and tell Ken at Realivent where you re-read about them :)  They run an augmented Wordpress platform, so migration of your current site would be pretty painless.  

Lenn, what may seem like tricks are actually strategies.  We're experiencing an unstoppable movement into a new era of real estate, an era dictated by a more enlightened consumer, whether this is a good thing or a bad thing is irrelevant, it is the thing.  

 

 

Mar 12, 2008 12:44 PM
Claudia Field
Baird & Warner, Barrington - Barrington, IL
A bit much to digest, but a lot of interesting things to think about. Smaller bites would help, but I will be returning to your thoughts to work it all through.
Mar 12, 2008 12:54 PM
Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

I'm getting ready to do a series on Redfin... It hit me this afternoon, and I can't seem to lose it. 

But, you have a few points.  The one difference I would point out is that the innovators are starting to pay attention too.  I think Zillow has had a major change in purpose, and I think Trulia is moving to a different model than before.  Redfin...  Well, they have to pray that they are only barely successful.  If their stated purpose comes to pass, their business model fails.  

Mar 12, 2008 01:13 PM
Rob Lusk
Habitatboom.com - Charlotte, NC

You can do all of this on www.habitatboom.com!  It is designed for you to exclusively own your region and control the advertising in it.  You can generate infinite possibilities using this site and this system. 

Please, please, please email me if you want a rundown on this system.  I cannot find a better way for Realtors and Loan Originators to fill their databases, pipelines. 

The system works.

Rob Lusk

Rob@Habitatboom.com

 

Mar 12, 2008 02:12 PM
Stephanie Moen (Lazcano)
Champions Real Estate Group - Houston, TX
Commercial Property Manager and Leasing Agent
Linking back to your site is very important
Mar 12, 2008 08:22 PM
Kent Simpson
Realty One Group Mountain Desert - Tucson, AZ
Real Estate Is About People
You know, I've bookmarked a lot of the places you mentioned...and then forgotten about them.  Thanks for putting me back on track.
Mar 14, 2008 01:34 AM
Obeoman Glade Jones
www.obeo.com - Salt Lake City, UT

Jeff,

Very info-dense post, but well worth chewing through.

Just wanted to ask you what you thought of Amerisave - they are talking about Relators selling their own mortgages. Not a new idea, but how do you keep it transparent?

Steve

Mar 16, 2008 07:58 AM
Jeff Corbett
BoomTown - Charleston, SC

Bad idea...

Each is their own industry...both require different skill sets, depths of knowledge and relative experience.  

I owned a mortgage and real estate brokerage simultaneously, and never met an individual who could perform both duties effectively (usually disastrously)...  

Having a real estate professional try and 'sell' mortgages too would (further) diminish the quality of the current pool.  

 

Reversing the question: What do you think about mortgage brokers selling real estate?  

Mar 16, 2008 08:16 AM
Sharon Alters
Coldwell Banker Vanguard Realty - 904-673-2308 - Fleming Island, FL
Realtor - Homes for Sale Fleming Island FL

As Steven said - very info-dense. Many realtors resist Zillow and I admit to having resistance because of the inaccuracy of their Zestimates. But you make a valid point - it is a paradigm shift like it or not. We might as well join it because we sure aren't going to go backwards!

Your post reminds me of a quote from the book of Daniel where he is seeing into the future and talks about knowledge increasing very quickly. That's what is happening, isn't it? Love your observation about that and the types of people :)

Oct 02, 2008 04:11 PM