The 2019 Home Buyers and Sellers Generational Trends Report is out, and there’s lots of good news for agents. Eighty-seven percent of all buyers purchased their home through a real estate agent, and 92% of those buyers 28 and younger did. That’s a tiny increase over last year’s figures and continues a growing trend over the last decade plus, despite the rise of consumer-facing portals and DIY tools for buyers and sellers.

National Association of Realtors

Agent Use Continues to Climb

Unsurprisingly, the most coveted benefit for buyers was the guidance and advice sought regarding the home buying process, particularly among younger, first-time buyers. Rounding out the top benefits…


Would you ever agree to pay your server 20% before you’re seated at the restaurant?

In the past, we’ve talked about the compensation model for brokers (here and here). As Redfin continue to grow, the fixed-fee/discount model is continually positioned as a superior one. There’s REX and its $2,000 fee, Homie and it’s $1500 fee, and a slew of others who are hitching their wagon to the trend that fixed-fee aligns best with the incentives of the client: why pay more simply because you spend more?

The issue, as is well documented, is that there is often a stigma with ‘discount’ that implies lack of quality services provided when compared to the traditional brokerage model…


What Are the Potential Implications to NAR, MLS Associations, Brokers/Agents, and Software Companies?

First of all, if you haven’t been watching Hot Ones on YouTube, you really should. I have been a late adopter but it’s been my go-to time-killer the last month or so. With that in mind, I’d like to break down the implications of the recently (and very fiery) filed class action lawsuit within the United States District Court in the Northern District of Illinois (hello, Chicago!) on Wednesday, March 6th, 2019 by generating some potential outcomes on a scale of mild to armageddon.

But First, The Case Brief

The class action lawsuit names the plaintiffs as “all persons who paid a broker commission since…


What’s in Store for This Year and Beyond?

Over the past five years, venture capital has poured into the real estate sector creating exciting new technologies, establishing new brands, and expanding the abilities for both professionals and consumers. Chief among them are the integration of artificial intelligence, growth of Compass, additional lines of business for Zillow, and proliferation of a consumer-first attitude when it comes to technology development.

Backed by a ten-fold increase in VC dollars, there are significant trends that have lots of wind in their sails. Here are some of my predictions for how this will play out in 2019 (and beyond):

  1. Consumer Engagement Takes Center…


Is Zillow More Valuable As the Sum of Its Parts?

We recently wrote a piece that looked at the lifecycle of marketplace startups, specifically as it relates to real estate technology. A key theme is that the incumbents, most notably Craigslist, spawned a slew of companies that focused on a single vertical and benefitted by going deeper to provide a better consumer experience.

Today, there exists is a similar emergence when looking at Zillow: successful companies and applications are being developed by focusing on certain features within its platform. The question is, are companies that offer more singular value, but perhaps do those few things better, better off than a…


Hyperlocal is back in style. How long will it last?

In The Beginning, There Were Brokers

A not long, long time ago, real estate was a hyperlocal affair. Brokers owned the keys to the listing vault, were known around town, and built businesses based on genuine trust and relationships.

Old school marketing, like newspaper ads and bus benches, were the norm, and generally worked well. As is still true today, referrals are a lifeblood. What appeared to be a rather sleepy industry was shaken up with the advent of the internet and the birth of portals and consumer-controlled tools.

From A to Zillow

The disruption that Zillow (and its peers) were supposed to cause was largely overblown. Agent use has…


When should buyers make an offer? When should sellers accept?

The 37% Rule

How many people should you date before you commit to one? What about candidates to interview before making a decision? Parking spots to pass by before choosing?

How many homes should you look at before submitting an offer? How many offers should you review before accepting?

As with any decisions where comparisons are being made, committing is scary. If you commit too soon you risk out on a better option down the road. Too late and you may have passed up the optimal choice. …


What Took Them So Long?

I noticed Redfin has done some updating to their website design. In addition to properties placed on ‘cards’ in the map view, Redfin appears to have fully defaulted the ‘Recommended’ listings to that of their own. The question is, why did it take them this long?

Protect Your Own

As its own brokerage, Redfin has some unique abilities its public rival Zillow cannot claim, namely, it can afford to alienate some non-Redfin brokers by pushing its own listings. With a 1% listing fee and excellent technology, this is a powerful combination, and one that the company obviously hopes will lead to more business.

Redfin listing stands out and is listed first under Recommended


What’s With “Platforms”, “Networks”, and “Marketplaces” in Real Estate Tech Talk?

Andrew Chen and Li Jin co-authored a fantastic piece entitled, What’s Next for Marketplace Startups? that details the ascent of platforms as a business model, starting with “unmanaged horizontal marketplaces” like Craigslist through the “Uber for X” era and into today’s fully-fledged consumer platforms like OpenDoor.

Below I’ll walk through a paraphrased analysis of their work and apply it specifically to the real estate industry to take a peek at what lies around the corner for brokers and home buyers/sellers.

The Birth of Software as a Service

The marketplace for goods has been well documented, thanks to the meteoric rise of tech giants like Amazon and eBay…


And that’s good for consumers

The basic tenants of home buying and selling have remained unchanged for over a century. However, new models are emerging that redefine the role of the agent, offer alternative buyers to sellers, and provide new channels for both consumers and professionals to interact.

“Disruption” is a trending word throughout the industry — but how disruptive are these new business models? I’ll cover two well known challengers, discount/fixed-fee brokerages and For Sale By Owner (“FSBO”), dissect a trending third, the iBuyer movement, and enter a fourth, platforms, into the competition.

The Incumbents

Discount and Fixed-Fee Brokerages

I am going to lump these two business models together as…

James

Founder | Homebloq | Real Estate Technology & Marketing

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