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Op/Ed

What will disrupt real estate next? The answers will likely surprise you.

Watching for what will disrupt your industry is key to survival, and there are many shifts on the horizon that most aren’t even considering yet.

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disrupt real estate

The real estate industry has always been a conundrum. On the one hand, we are still doing business the same way we always have. In a simplistic view, Realtors market properties and put deals together. On the other hand, the industry operates on an amazing concept of “coopetition” that is not found in such a large scale in any other industry.

Recently, I was asked how the real estate industry worked… a loaded question if I ever heard one. To explain, I used buying a car as an example. Imagine if every car dealer in your local area put all the cars they had for sale on one website and allowed salesman from other dealerships to sell their cars. Someone from the Ford dealer could walk onto a CarMax lot with a buyer and “sell” them a car.

Actually, that sounded like a good idea to me the consumer, but auto dealers would never go for it. But in real estate, that’s what we’ve been doing for decades. I cannot think of another industry that cooperates and competes on the same playing field, at least on the same scale as real estate.

The real estate industry also adapts quite well to tectonic shifts caused by changing consumer expectations. When buyer agency came to be a consumer expectation, the industry shifted. When the Internet achieved mass appeal, the industry adapted. When the public shifted attention to large aggregators, Realtors® were right there… still marketing properties and closing deals.

Where We Are Now

Currently, we are in the final stages of the Internet Infiltration and in the 4th quarter of the Portal Party. These are simply business cycles that will cease to be big deals once they have reached maturity.

The Internet has matured from a disruptive technology to a basic utility. Portals or aggregators have made it through puberty and are now in those difficult teenage years. Soon they will be leaving the house as mature adults and we won’t see them as much. Frankly, I can’t wait.

While there are lots of technology changes on the way that could disrupt the industry as much as the Internet did, to see the next change, you need to look to consumers. Consumers wanted to be represented in the transaction, so we gave them buyer agents. They wanted on-line access to property listing, so we gave it to them and instead of being satisfied, they asked for a better experience… enter the large aggregators.

No one knows what’s next, but looking at changing consumer expectations will give us a glimpse at the possibilities.

So what’s the next big shift in the industry that will cause industry watchers and doomsayers to predict the end of real estate as we know it?

Here are a few possible consumer frustrations that might foster the next disruptive expectation:

Artificial Intelligence (AI)

While AI has been around a while, it is just now starting to reach the mainstream. This matches perfectly with consumer expectations of quick responses from Realtors®. Unfortunately, these consumer expectations are NOT being met today.

Some will predict that AI will replace the need for Realtors®, but we’ve heard that song before. Instead, I look for the industry to embrace AI as a way to solve the speedy response expectation gap. When a consumer sends an email or text asking for more information, instantly a computer using AI will respond. And when I say respond, I mean better than any agent ever could. AI will know more about the property than the MLS or agent and will use big data to know more about the inquiring consumer than a human ever could.

Like any new game-changing technology, this one will scare most folks at first and there will be resistance. Consumers are already starting to move past the “creeped-out” phase of this technology and soon advantages of AI will out-weigh the fears. As we have with other new technologies, the real estate industry will embrace this as soon as it becomes a consumer expectation.

Mortgage Malaise

To find future consumer expectations, you only need to look at current consumer frustrations. AI will help with the consumer’s expectation for instant responses from Realtors®, but the frustrations over mortgages are more complicated. While AI may help solve the problem, the real problem is human’s displaying artificial (as in fake) intelligence. To keep this editorial from turning into a novel, can we all just agree that Congress and regulators have completely screwed up the mortgage industry, making it painful for consumers to get loans?

Since you probably have your own horror story about the mortgage process, I’ll spare you by not sharing mine. Instead, let’s focus on the seemingly remote chance we find a solution to this consumer frustration. The beauty of capitalism (including the real estate industry) is that entrepreneurs generally find solutions that fill the gap between consumer expectations and reality. Eventually this will happen with mortgages.

Currently, consumer expectations are low with obtaining mortgages. Having been beaten down by the financial crisis, over-correcting government regulations, and sluggish home prices, consumers expect a difficult experience when applying for a mortgage. When the overall housing market heats up next decade thanks to favorable demographics, we can expect consumer expectations to change.

Hopefully we will never return to the days of 125% LTV’s, and No Doc Loans, but consumers will expect an easier, faster experience. It is hard to imagine a mortgage process that can be completed in a week or less, but why shouldn’t consumers expect that? If you have good credit and income, why do you have to wait in the same line with those who don’t? The current process penalizes everyone and rewards no one. Capitalism does not support such a business model for long and will figure out a way to fix this silliness.

Here are a few thoughts to consider that don’t require the regulators and politicians to fix things: Why do we have to wait until a contract is accepted to do appraisals, surveys, title searches, and even home inspections? Also, why does the buyer have to wait to apply for the loan until they find a property? Finally, why don’t we give buyers with good credit an express lane that rewards them?

Changing Demographics

The other significant emerging consumer expectation is more related to demographics than current frustrations. Currently, cities are seeing an influx of young homebuyers and renters. Next decade, that group will shift to the suburbs in search of better schools and lower taxes. Baby boomers followed a similar migration pattern decades ago.

The difference between the Millennial generation and the Boomers is their expectations, especially related to technology. AI will not creep them out and smart homes will attract them. They will also expect better pictures and videos of properties that put them in control of deciding which properties are worth the time to actually go see.

Drones and smartphones have created better opportunities for Realtors® to improve video images for homes they are marketing, but unless the industry takes a major step forward in this area, the expectations of the Millennials will not be met.

While Realtors® have been impressive in embracing technology in the past, the bar will be raised again by the emergence of the Millennials as the primary force in the real estate marketplace. Realtors® will need to raise their use of technology in communications, service, and marketing to stay relevant with the next dominate generation in the marketplace.

The wrap up

While only time will tell which of these three (if any) will cause a tectonic shift in the real estate industry, we can be certain that there will be a shift. It could be caused by something that we can’t see coming, or by something that has yet to be invented.

Based on history, we will embrace the shift and remain relevant. We’ll figure out how to use the shift to create a better way to market properties and make deals happen. In real estate, the more things change, the more they stay the same.

Dave is a 20+ year veteran in Realtor® association management and leadership and is currently the CEO of the Pennsylvania Association of Realtors®. He is a writer, speaker, strategic planner, and life-long learner with a passion for creative thinking. Dave has published his first novel For Reasons Unknown and will be publishing his second by the end of the year.

Op/Ed

Why delegation of work doesn’t always lead to productivity

(OPINION / EDITORIAL) Delegation is tricky, and can end up creating more work for yourself if it isn’t done well. Here’s how to fix that.

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Man talking on virtual meeting, using delegation to get more work done.

Delegating work is a logical step in the process of attaining peak efficiency. It’s also a step that, when executed incorrectly, leads to a huge headache and a lot of extra work for whomever is delegating tasks—not to mention frustration on the part of those asked to complete said tasks. Here is how you can assign work with the confidence that it will be done quickly and effectively.

Firstly, realizing that a “one size fits all” approach doesn’t work can be a bit of a blow. It’s certainly easier to assign tasks across the board and wait for them to be completed; however, when you consider how much clean-up work you have to do when those tasks don’t end the way you expect them to, it’s actually simpler to assign tasks according to employees’ strengths and weaknesses, providing appropriate supports along the way.

In education, this process is called “differentiation”, and it’s the same idea: If you assign 30 students the exact same work, you’ll see pretty close to 30 different answers. Assigning that same piece with the accommodations each student needs to succeed—or giving them different parameters according to their strengths—means more consistency overall. You can apply that same concept to your delegation.

Another weak point in many people’s management models revolves around how employees see their superiors. In part, this isn’t your fault; American authority paradigms mandate that employees fear their bosses, bend over backward to impress them, and refrain from communicating concerns. However, it is ultimately your job to make sure that your employees feel both supported and capable.

To wit, assign your employees open-ended questions and thought-provoking problems early on to allow them to foster critical thinking skills. The more you solve their problems for them, the more they will begin to rely on you in a crisis—and the more work you’ll take home despite all of your delegation efforts. Molding employees into problem-solvers can certainly take time, but it’s worth the wait.

Finally, your employees may lack strength in the areas of quality and initiative. That sounds a lot worse than it actually is—basically, employees may not know what you expect, and in the absence of certainty, they will flounder. You can solve this by providing employees with the aforementioned supports; in this case, those look like a list of things to avoid, a bulleted list of priorities for a given project, or even a demo of how to complete their work.

Again, this sounds like a lot of effort upfront for your delegation, but you’ll find your patience rewarded come deadline time.

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Op/Ed

Why men are called ‘creators,’ and women ‘influencers’ (or not)

(EDITORIAL) A sh*tstorm has been brewing regarding why men are supposedly referred to as “creators” while women are called “influencers,” and it gets complicated before it simplicity is revealed…

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creators v. influencers

According to a recent WIRED editorial, a woman is more likely to call herself influencer, while a man is more likely to call himself a creator, because, “Generally speaking, women consider themselves part of the product, while men separate their notion of self from their labor, considering themselves its “creator.”

Besides being no more founded than “generally speaking” though, this sort of notion first assumes creators and influencers encompass the same job description, with the only delineating factor being gender.

In fact, one of the earliest assertions made in the editorial notes, “Really, the only way to guarantee that people will think of your online celebrity as ‘influence’ is to be a woman.”

When ”really,” there is a world of women who identify as creators and men influencers; the differences can be seen in their varying job descriptions, history, and business needs that each fulfill. Therefore, the issue at hand should not be “why men are called creators and women are called influencers,” but “why we should call influencers ‘influencers,’ and creators ‘creators’.”

And that is what we will explore today.

First, let’s understand what an “influencer” is and what a “creator” is.

Before getting into explanations, and differences, it is important to note that influencer and creator are most always a term people use to identify themselves, so the true meaning of the word is specific to each individual.

Generally speaking though, today’s influencer is someone who has educated themselves enough to be considered an authority in their niche (or can at least present themselves as informed). They use this authority, along with their personal brand,to persuade and inspire their following for gain, which can be monetary, or in the form of free products, and/or free publicity.

Influencers often make their gains by partnering with brands to promote their product, or from creating a product themselves, and selling it to their following directly.

For an influencer, a larger audience or following is linear with gains, so a large amount of their focus is on the numbers – followers, website visitors, comments, and likes. The rest of their focus is in making sure those followers are influenced enough to consume whatever is being promoted.

Why businesses tap into influencers’ networks today.

The sole reason businesses hire influencers is for exposure. We’ve all heard “what good is your product/service if no one knows it exists?” or something similar, and for brands, that is exactly what influencers are hired to help with. They act as distribution channels by bringing more eyeballs which, if done properly, translates into more money.

A creator, on the other hand, is more concerned with the finished product of their work and the creation process it took to get there.

So, what is a creator?

Depending on what they are working on, a creator is an artist, producer, maker, writer, or composer who gets paid for captivating work. This person is usually more passionate about design, brand collateral, video creation etc. than persuading the people who will consume their work.

More followers, higher monthly reach, and increased engagement rates don’t excite the devout creator like strategy, composition, and contrast does. For them, one superior piece of work (think one overall cohesive brand package) is more satisfying than producing a mass of mediocre work.

Promoting themselves like an influencer isn’t as important as showing their work. Take my close friend, Chad as an example; he produces a podcast that boasts over a million listeners, and averages 20k views on each Instagram video, which you’d never know by looking at his personal profile. There, he has 2.5k followers, posts every four months, and gets most of his comments from old college friends – all of whom work for him. His virtue, like a lot of creators, is in the quality of his work.

Why businesses hire creators.

Creators do for businesses what a boutique ad agency would do, typically for a fraction of the cost. They use their art to build brand assets, establish brand identity, and create campaigns. While influencers are used as “the face,” a creator could be used as a “face” or the behind the scenes person who you never see. In a sneaker campaign for example, a creator might be tasked with taking cool pictures of other people’s street style, while an influencer would promote themselves in the shoes.

Creators and influencers are different and fulfill different business needs, but they are not mutually exclusive.

A creator can do influencer work, and there are influencers who create magnificent work without them in it. It’s a matter of self identity.

Influencers are also inherently tied to monetizing their content or, “…building a platform with he intention of being used by brands for marketing purposes,” according to Natasha Hunes, a Youtuber who self-identifies as a creator. Hunes adds that a creator is in for the self-expression, not money, adding “I don’t think the claim that most women don’t identify as creators is factual.”

Let’s dissect the history of the two terms.

The biggest factor in establishing the difference between creator and influencer is the history of the two. In a response to the WIRED piece, Taylor Lorenz gives an in-depth history of how “creator” predated “influencer.”

It all started in 2011, when YouTube wanted to replace the boring term “YouTube Stars” for a more inclusive way to describe their multi-talented content creators.

“These people were more than onscreen tales,“ said Tim Shey, a former employer of YouTube, “They could write, edit, produce, do community management, and were entrepreneurs.”

During the search, YouTube forged a partnership with Next New Networks, a multi-channel network specializing in viral content, and started a program called the “Next New Creators” program. This program was designed to help independent YouTube stars grow their audience to the point of monetization. The program became such a hit, the word “creator” stuck at YouTube and began to be the phrasing of choice for their press releases, and future programs.

They went on to open a number of “creator hubs” and studios for YouTube creators to collaborate with one another.

From 2011 to 2016, the video platform continued to promote their new world of creators and hit the sweet spot in 2015 after launching a massive creator ad campaign. This campaign plastered different creators’ faces on billboards, taxis, buses, and subway stops all over New York and L.A., as well as in magazines and commercials. All of the language referred to the people in the ads as creators, and that’s when the term became mainstream.

Not long after, other platforms caught on – in 2015, Tumblr also began referring to their power users as creators and launched a division called “Tumblr Creators Network.”

Influencers went mainstream in 2017, two years after creator did, and according to Lorenz, was the response to the rise of Instagram, Twitter, Pinterest, and sponsored posts.

As the “new kids on the block” influencers were initially stereotyped as less worthy than traditional YouTube creators, who had spent years establishing their base on an older platform, and a larger platform than IG, Twitter, and Pinterest. Therefore, Lorenz believes the distinction between creators and influencers are not gender related, but more so “platform-agnostic.” This means you’re more likely to find YouTubers identifying themselves as creators, while IG, Twitter, and Pinterest users typically identify is influencers.

And while I do understand Lorenz’s “platform-agnostic” argument more than WIRED’s position that it is a gender-based distinction, I believe that the differentiation as self-assigned terms are a lot simpler than we think.

Man or woman, YouTube or Instagram, people just want to be called what they identify with.

Creators want to be called creators because they relate more with creating, and influencers want to be called influencers because they enjoy interacting with and influencing their following.

Remember my friend Chat, the podcast producer? I asked why he identifies with creator and not influencer, despite some of his work being influencer-based.

His answer?

“I feel more like a creator.”

And I felt THAT.

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Op/Ed

5 ‘lies’ HGTV tells viewers that impact the housing market

(OPINION EDITORIAL) HGTV has long been a fan favorite for renovations and home searches, but is the information they portray accurate? What influence does this really have on consumers?

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Man watching HGTV show on tablet device.

It’s no secret that reality television very often does not, in fact, depict reality. One of the most frequently viewed “reality” television networks is HGTV, which features a wide range of home renovation and DIY shows that cater to a variety of home improvement enthusiasts.

While HGTV wants you to get lost in the latest episode of House Hunters, you may be surprised to know that these episodes are in fact, at least partially scripted.

Although there is nothing wrong with enjoying a good home improvement show, especially those ever-addicting home flipping shows like Fixer Uppers, there are a few things HGTV portrays that are less than accurate. Here are five of those things you may want to consider, or have your clients consider before embarking in the home ownership process yourself (or with a client).

Consider the following…

1. Realtors work a lot harder/longer than people think

Unfortunately, HGTV often portrays real estate agents as people who do the bare minimum for their clients, when in fact most Realtors® go above and beyond for their clients.

According to CheatSheet, Sissy Lapin, author and co-founder of ListingDoor, stated shows like House Hunters “make the agent look like they’re just these lazy people who show two houses and negotiate $1,000 off the asking price,” rather than showing the whole host of duties a good agent performs for their clients.

Good agents tackle the whole home buying process; informing clients about what they should consider when selecting a home, negotiating a better deal, and making sure that they do their very best to ensure nothing goes wrong throughout the entire process from start to close.

This is not the impression a potential homebuyer would get from HGTV alone. Realtors are an amazing asset to have on your team when you’re considering buying or selling a home, and they do a lot more than HGTV portrays.

2. Over-emphasizing the importance of new features

HGTV shows make a production out of showing homeowners frantically searching for the “perfect home” with all the “must have” features. In all fairness, sponsorship from the latest and greatest in home innovations is how they make some of their money. While it’s certainly understandable that most homeowners have a list of things they want in a new home, worrying sellers into thinking they won’t be able to sell their home unless they have these highly coveted features is an entirely different thing.

Lapin commented, “I can’t tell you how many times that I go into a house and they’re like, do you think it would add more value, or do you think it would sell faster if I put in granite countertops?” In fact, like many other trends in homes, consumers are moving away from granite to other sustainable materials. But you would never guess this if you believe everything HGTV is promoting on their shows. Again, the key is to do your own research. Consult a professional and inquire as to what would increase your home’s value.

3. Downplaying the expense of renovations

If you took what HGTV shows to heart, you’d be inclined to believe that major home renovations can be completed in mere hours for a few hundred dollars. If you’ve ever seen Property Brothers, you know the brothers function on extremely fast renovations schedules and very low budgets. This is likely not the situation you’ll encounter if you decide to renovate your own home (or a project home). Even contractors have complained that these types of shows are giving people an inaccurate picture about renovation expectations.

“Remodelers say that shows such as Love It or List It and Property Brothers, which often cram whole-house remodeling projects into too-small budgets, give clients the wrong impression regarding pricing and time constraints,” notes Tim Regan, writer for Remodeling.com. Also, according to CheatSheet, some renovations may not even be up to code.

One couple who appeared on Love It or List It are suing the show’s production company stating their home was “irreparably damaged” and a that a licensed architect was not hired.

To ensure your next project goes smoothly the best thing you can do is consult with a licensed, bonded, and insured contractor. They will be able to give you a time table and price range that is more realistic than what you see on HGTV.

4. Location, location, location

While not as important as the other factors on this list, in my opinion, it is certainly something to be considered. HGTV shows like House Hunters very rarely focus on the importance of location with the home buyer.

Lapin stated in one episode, she watched as a couple chose a home because of its stylish features even though it meant they would have to make a 45 minute commute to work. While everyone is entitled to make their own choices, Lapin makes a good point in stating that she would have “made [her] client make that drive to work three days in a row” to see if they would still enjoy the location of their new home.

This is one of the many benefits to having a Realtor® on your side: they know the ins and outs of home values, location, and more. Getting your information from a Realtor® will take you a lot further (and very likely save you money) than the information you can get from HGTV programming.

5. Buyers know more than some think

Contrary to what HGTV would like you to believe, buyers are not naïve. For the most part, buyers are real-world savvy and have a good idea about what they need and the price range they can afford. This is the age of digital technology, and most buyers are putting that technology to use, researching before they set out to buy something.

Sites like Zillow give buyers an idea of what’s available for how much, and they can even see what the home looks like without getting out and driving to the location. HGTV tends to show buyers that don’t know what they want or how much they can spend.

This is likely done to make their professionals seem more knowledgeable, but in reality, as Lapin states, “the buyer, the consumer, is very savvy and I feel like that’s not portrayed. Buyers have a lot of confidence now.” This isn’t to say most buyers don’t still welcome guidance from a professional, but they do have a general idea of what they want and what they can spend, by and large.

Instead of viewing HGTV as an example to follow, or representative of the market as a whole, it should be treated as entertainment.

While there are some aspects of the show that may be useful to some viewers, such as window replacement and selecting new flooring, it definitely shouldn’t be held as the gold standard for service or the home buying experience.

Consumers’ best bet is to consult an industry professional who can give you a more realistic picture of cost and time.

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