September 24, 2009
A University of Toronto Professor I was speaking with the other day told me she thought real estate agents may become obsolete. She said the utility of agents as ‘connectors’ remained indispensable to society due only to the information they possess. In a nutshell, people have employed real estate agents because agents have had access to the most information. Now, the internet is displacing agents as the best source for information. She then went on to speak about how travel agents have been displaced by the internet – Expedia, Kayak, etc. for similar reasons.
The conversation made me think about what the future of acquiring and selling real estate really is. There are definite parallels between the travel industry and real estate and there are also differences. The most notable being the scope of the transaction – real estate transactions are incomparably larger, more complex and entail greater due diligence and negotiation. For this reason the industry shattering shift that has already occurred in the travel industry has to yet to arrive in real estate.
Nevertheless, I have the following prediction to make with regard to the future of real estate transactions. I’ll give the date of my prediction as 2015 – just over 5 years away and this is how it goes:
Sally is a successful entrepreneur who’s looking to purchase a new condo in downtown Toronto. One day while on her way to a Maple Leafs game she spots a construction pit on a street she likes and across the road from her favorite restaurant. She aims her Blackberry Evolve at the project and her augmented reality browser tells her that it’s the new Tridel 52 storey condo called ‘Bright’ that has 42 still available units starting at $388,000 – she asks her phone to remind her about it when she’s home later that evening.
At home later that evening a tablet monitor, which sits on her kitchen table and is wirelessly synced to her phone and computer, reminds her of the new Tridel development ‘Bright’. She puts on her 3D headset and logs on to her favorite real estate portal. She then browses high def 3D renderings of the development and interior layouts and then using Google Streetview 3.0 takes a virtual daytime stroll around the neighborhood. Later she checks out social media generated reviews of the developer Tridel as well as industry expert opinions and ratings of the project – all within the same real estate portal. She asks some questions in the community forum such as the advantages of upgrading her kitchen appliances and within minutes she has received responses by individuals researching the same development – as well as an answer by the online social media director of Tridel.
The next morning (which is Saturday) Sally visits her favorite real estate portal again, fills out a quick questionnaire about how she feels about balconies, time spent in elevators, favorite views, price range, etc. and it tells her that the most ideal unit for her is PH22 at a cost of 1.1 million. She is informed that its the last unit of its kind left and that the automated system has pre-approved her for a mortgage at 5.8%. If she puts down $90,000 the unit will be hers. All she needs to do is authenticate herself by using her tablet’s fingerprint scan and the transaction is complete.
This is where my prediction ends. The question is does she now contact a realtor or does she complete the transaction online – we’ll find out in just five years.