REAL ESTATE AND THE FUTURE; A CHAT WITH REALTORS AND EXPERTS
It is no longer news that, the real estate sector is one to reckon with in the world today, as the sector is already paying its bills by providing homes and properties for those that desire them. Real Estate happened to be a sector that provides the basics of human needs and wants. This singular responsibility has made many to believe that the sector will make it big in years to come, just as it will continue to positively affect the lives of the people. However, despite being such an important moment in one’s life, the real estate industry as a whole has been slow to recognize and implement customer demands which has caused a lot of frustration throughout the industry. In the most recent years, as consumers demands have gotten louder, startups are recognizing the opportunity and jumping in to solve these problems. It is however in this background that EXCELLENT PROPERTY MAGAZINE (EPM) interacts with some experts in the field so as to know what the future holds for real estate and realtors, especially with the advent of technologies. These are what they have to say;
Alhaji Sikiru Kamarudeen, Chairman, Association of Property Developers, Shomolu/ Bariga Local Government Area said, at the time he ventured into the real estate sector over 13years ago, he already knew that things await the industry in the future. He said, “10 to 15 years from now, real estate will be more of a technology-driven, ecommerce experience with agents performing very much reduced role still centered on paperwork and compliances (i.e. contracts, state laws, etc).
While contacted, Mr Jamiu Oloyede, a real estate agent said, Real estate professionals with skills and knowledge of finance, investment, strategic planning and networking will survive the technological disruption in the sector, adding that over 70% of Millennial buyers/renters still prefer to hire a real estate professional, they expect agents/brokers to be their “trusted advisors”, bringing strategic thinking and creative insights along the way. He however disclosed that buyers will in the future, focus on properties with more space and cheaper prices in suburbs and smaller cities/towns, making agents commission to drop.
Mr. Bulus Jude, a real estate analyst told EPM that the broker-agent relationship as we know it now will be all but gone. He asserted that agents will pick a real estate all-in-one mega-platform, possibly a virtual coach and a few Facebook groups that essentially act as collective-conscious mentors for agents. He stated further that the Broker value will simply be experience, local market knowledge and connections, adding that unless Brokers provide the tech platform and leads, the value won’t be at 50/50, 70/30 or even 80/20 split. Mr. Jude added that the agent-client relationship will follow suit, with a new generation of clients who will not perceive the agent’s experience, problem-solving, local market knowledge and connections as a big enough value anymore. Instead, they will rely on the one-two punch of artificial intelligence and big data to not only greatly simplify the search process but to advise them on key aspects of the transaction.
In a telephone chat with EPM, a real estate lawyer, Barrister Charles Akinpelumi said, Real Estate in the future will not be a buy and sell industry but will be a lifelong investment into an asset that will have a life cycle from private use to investment to shared asset and back again. His words; “In 10-15 years, I believe we’ll see the following changes in the real estate industry: Most low- and middle-income homes will be sold through flat-fee online real estate brokerages. While traditional Realtors won’t be made obsolete, they’ll narrow to more specialty niches, such as selling unusual homes or working with investors. “More buyers than ever before will buy long-distance, never having seen the property in person. Virtual reality will lead to virtual reality, as it becomes possible to interactively “walk through” a home, open closets and cupboards, etc. But VR can go even further, in helping buyers see what the light looks like at different times of day and year, and superimpose furniture, art or even home repairs.”
Judging by the above opinions and inputs of real estate experts, it is safe to say that the sector is on the verge of a technology watershed moment. Although, it is not quite there yet as several things are still holding it back, including the current generation of Realtors themselves, purposeful proliferation of traditional ways of the market, monolithic and controlling real estate market heavyweights. Real estate will continue to be shaped by lifestyle, sustainability and technology. There will continue to be a move to city centers and a need for affordable dense housing near mass transit. Most of the process for buying, financing or renting real estate will be done through online platforms as online venues will serve as efficient and effective ways to conduct transactions and will reduce the necessity for human interaction with brokers and lenders. Home buyers with employment and OK to better credit will be receiving almost instantaneous mortgage approvals right from their smart phones while commissions will come down or rebates will become commonplace. Perhaps more clients will pay realtors by the hour to end the subsidy problem. Agents will have to align themselves with teams or brokerages that provide them with clients since they will no longer be able to get clients by schmoozing. Virtual reality will give tenants, especially larger tenants flexibility and choice with the ability to design their space with a menu of options for construction, furniture, design, etc. Lastly, there will be a growth in customization of lease terms. Landlord will meet smaller company tenants growing demand for short-term and flexible spaces. Landlords will pre-build spaces using moveable walls and demountable partitions, allowing tenants to quickly and cost effectively change the size or configuration of their space.