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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

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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Op/Ed

Career breaks can close doors, but may open a new window

(EDITORIAL) A job pause can be maddeningly frustrating, but they can also open new opportunities to grow or start anew.

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Career change

What’s worse than stand-still traffic?

The start-stop traffic.

In a standstill, you know where you stand… still. In stop n’ go n’ stop again traffic, you have no clue. You go from 5 to 50 again for all of three feet, then back to 5. Eventually, you don’t even care about getting to your destination anymore, just so long as the tedium ceases.

My jobs went almost exactly the same way.

Retail work, career work. Retail work, career work. Retail work, career work. And each time I had to take a pause, I didn’t have enough time, money, or interest to keep up with the rising trend of ‘content creators’ who can film, edit, script, photograph, edit THOSE, AND do blogs and emails replacing copywriter positions. So I just stayed scrambling until I could ‘relax’ into a career gig that ended shortly for one reason or another.

Even though I left each advertising job under different circumstances, in late 2019, I realized, ‘Okay, maybe it’s ME. Maybe if I’m this frustrated with the traffic, I need to pull off the road.’

The last shift saw me go from copywriter, to house cleaner, to heavy metal head shop gal, to moderating freight brokerage in the span of two months. Hell of a detour…

Of course now that I’m out of full-time work in the field I sold my credit score to break into, the guilt of having left a career I soured on to break into a field I didn’t need to go to college at all for is… crushing. And new beginnings, with wages to match, are hard no matter who you are.

However, this shame and heaviness is all coming from the inside. My parents are proud, my friends are happy for me, and I have yet to hear anyone actively dumping on my decision to purposely exit the salaried copywriting field. And even if everyone sucked about my choice, it wouldn’t change the fact that so far it’s the best one. At some point, you gotta shake yourself by the shoulders, borrow from Mrs. Knowles-Carter, and scream: Suck on my job cause, I’ve had enough.

Why deal with a stigma when you could deal with stigmata, right? Those are way cooler. And I’m pretty done with wounding myself either way.

Multiple small, panicked hiatuses taught me something. Some things. First thing: truly powerful screaming comes from the belly, not the throat. Most relevant thing: I don’t want to write for other people, nor for brands that can’t use some variant of my own voice.

I thought I was a copywriting mimic octopus who could change colors, shapes, and textures to suit an environment, but this whole time I’ve been a chameleon— always keeping my funky fresh shape, and only changing colors to suit how I feel, or to attract mates.

I’m not going to act like career pauses are some great thing in which to discover yourself and do some eat, pray, love BS. I quite literally almost died of a bad infection during a time I was on a pause with no heath insurance. The pauses were financially and mentally draining, and if it weren’t for extreme strokes of good fortune in several places, I wouldn’t be in a position to write this piece.

What I will say is that I was able to bid the misshapen phoenix cycle that I was on a frantic farewell, at least I think so. Anything’s liable to change, such is life.

For now, there is only to bag up the ashes and try to use them in fertilizing my next steps.

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Op/Ed

Love can turn your passion into a successful business

[EDITORIAL] You don’t always have to turn your passion into a business, but if you do, love can improve your chances of success.

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When it comes to finding your career path (whether you are a business owner, FTE, or budding entrepreneur), recent and current generations have been beat over the head with the advice to follow their passion. The idea of this is great – it makes sense that you want your work to be aligned with what you are interested in.

The challenge is that we are typically passionate about our hobbies and while sometimes those perfectly line up with a career (cake decorating leads to owning a bakery, horseback riding leads to teaching lessons to kids with disabilities, reading leads to being a librarian), there are times that it is OK to separate your interests and hobbies from work. The real question is how to identify where you are in life and how this lines up with your professional pursuits.

You may be in a place where you need to absorb all you can from formal education. You may need to work at a job on a product that you have no interest in, but are able to see how that company thrives and excels. You may launch a new product that you felt was needed in the world, only to learn that consumers didn’t feel the same.

Money makes the world go round… but love? Love makes it all worth it.

Once we accept that we are all on a human journey, we can assess where we are in that moment, and figure out how our work and personal lives collide. I think that is when we find our purpose, and are able to accept that we don’t always know how to turn our passion into a sustainable paycheck. If you can love your family, friends, and yourself… your work can lend to providing a life for you and them that feels like a full-circle.

I do think it matters that whomever you are working for has true love for their business; you need to find true love in your role or in what you are promoting if you are a business owner. If not, I think there’s a shelf life to what you’re doing that will show itself eventually. And that’s actually OK – every step is progress towards a life full of love and business.

Resource that can be helpful: Designing Your Life Workbook: A Framework for Building a Life You Can Thrive In

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