Looking for a lucrative real estate strategy? Start local.
In the past, realtors had something their clients didn’t: an in-depth knowledge of what properties were available, and exclusive access to valuable statistics that would help potential buyers make informed decisions.
But now, the internet has made all of this real estate information publicly available: access to listing prices, property ownership history, mortgage maturity date, and other property data is readily available to buyers online. They can filter searches to find information on zoning, location, price, and even floor plans. With thousands of listings literally at their fingertips, many potential buyers no longer feel that they need realtors to do the footwork for them.
Does this signal the end of traditional real estate sales? Hardly. But it does mean that to survive in the digital age, realtors need to fundamentally rethink the value they provide to consumers.
The Challenges to Traditional Realty
Credit for the public’s newfound real estate savvy is primarily owed to companies that are helping people access data that homeowners would historically have had no idea how to find, much less interpret without an expert’s guidance.
Take digital real estate databases like Zillow, for example. By breaking housing data out of the MLS (not to mention complex, hard-to-navigate municipal data portals), they’ve put the house hunting power back in the hands of consumers. Reonomy — one of the best-funded CRE tech startups — is another great example of a user-friendly platform that “lifts the veil” of commercial real estate for lenders, brokers, and investors.
With access to these comprehensive databases only a click away, it’s no wonder that For Sale By Owners are increasing — 25% of people who sold a home in 2016 did so without the help of a full-service agent, and 15% of people sold using a limited service agent. Companies like Clever Real Estate even offer a full-service realtor experience, but for a flat fee instead of a percent commission.
How to Adapt Your Expertise
But even while these changes put pressure on realtors’ margins and traditional revenue streams, they also create major opportunities.
More people are moving to new cities than ever before. Of course they need access to real estate data and lists of available properties — but they also need the human touch (and on-the-ground insight) of a realtor who can help them choose a great community in which to purchase a home.
That’s why, for today’s real estate professional, it’s so essential to think local. Intimate knowledge of a local market — the block-by-block kind that can’t be found in a spreadsheet or searched on the MLS — will become the new value-add for savvy agents. Realtors who are able to communicate their local knowledge and share their insights on local trends will see success despite the changing landscape of the industry.
Agents should embrace these consumer-centric changes, and focus on branding themselves as hyper-local soft-knowledge bases. Get your message out there, and you’ll be surprised by what a big impact staying local can have.
This article originally appeared on REALTOR® Magazine.
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