I read an article today in Forbes written by contributor Bruce Kasanoff entitled "Residential Real Estate in 2025: A Sneak Preview of Disruption". Go check out the article, but please come back for my rebuttal....
First, let's just say Bruce has a tendency to discredit REALTORs, agents and real estate brokers. He wrote an article last year declaring that real estate professionals were "obsolete".
His new article back-tracks that view a bit and predicts most brokers and agents will be reduced to menial, low-paying jobs like taking pictures and providing access to homes, while the majority of real estate transactions will be automated.
If you're familiar with the Zestimate, you'll know that automation of real estate doesn't work. The Zestimate assumes cookie-cutter status of homes and real estate while at the same time wildly mis-pricing many homes. Here's an article I wrote comparing Zestimates to actual sold prices- its very telling.
I've got news for you people: Every single home or piece of real estate is different! Even tract homes vary from unit to unit. When Henry Ford built the first assembly line, it was with the intent of making every car and part exactly them same. Using automation on real estate is like using the same response to everyone that talks to you!
Could you imagine?
Friendly encounter: "Hi Todd, How are you doing today?"
Me: "I'm good, thanks for asking."
My wife: "Todd, will you please pick some milk up before you come home?"
Me: "I'm good, thanks for asking."
Grocery store clerk: "That will be $4.64"
Me: "I'm good, thanks for asking."
Police detective investigating a murder: "Todd, where were you on the night of October 16th?"
Me: "I'm good, thanks for asking."
Yeah, I don't think so...
Remember in the 80's when everyone kept saying we'd be traveling in flying cars in 20 or 30 years? Nope, still driving around on the roads in my four-wheeled Chevy! Technology is great, but people, like this "contributor" mistakenly over-estimate its capabilities, or at least the future time-frame of its capabilities. Anyone remember the premise to the Terminator movies?! Nuclear war should have been waged by a smart computer over 15 years ago!
Look, real estate is not like the travel industry and how travel agents were replaced by websites. It is so much more complicated than that. And with new laws, rules and regulations hitting the real estate industry every year (which vary from state to state too!), brokers and real estate agents will become more educated out of necessity, and hence hold their value to the real estate transaction.
By the way, this blog of mine actually started as a comment on the Forbes article, but then I thought "Why am I helping their article rank on Google? Instead, I'll share it with my ActiveRain brethren."
My favorite part of this article was "Bidding, for example, could be handled by an automated system that includes legally-binding documents that would be instantly accessible to each party’s attorney."
So, we're going to dump real estate agents for attorneys? Yeah, that seems cost effective.
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