Real Estate Automation? 🤖 – TBG Update 10/2
This week I had a conversation with a potential seller who believes that real estate will get automated and computers/websites will make real estate agents obsolete. As a person who passionately does real estate well, there’s no way you can eliminate the human part of the house selling and buying process and get the same result.
I was doing a showing yesterday with a lovely couple who stayed at the house for a really long time studying every inch of the property with careful thought. As they were walking through the living room one last time on their way out, they shared that they just had a surprise third baby and they now need more space for the large family they never planned. They were studying the spaces and picturing the life the present sellers have in the house. They stopped and smiled at the elaborate gift wrapping station with clear labeled boxes of so much colorful ribbon, musing that the current owners must be super generous people to dedicate so much space set up to wrap so many gifts. They toured the house for over an hour and then they made plans to come back with parents and maybe other relatives to keep thinking and processing how their lives would look if they were to move neighborhoods and living spaces. Buying a house is too emotional, personal, involved, and human, for humans to be cut out of the process.
Our listing at 606 N Martel is an example of the classic way we represent a property for sale. The staging is fabulous, the house shows incredibly well, and we’ve been honored with showing after showing every single day for more than 30 days. So many people came, so many people liked the house, and so many people were circling and giving it thought. Until the day one person decided to write an offer, and then another and then another and we ended up with multiple offers and more than one person deciding they absolutely had to have the house…more than a month after the house went on the market. That whole process is so high contact, high touch, and high effort. The sale happens with so many showings and so many human to human conversations, and keeping track of all the people and their thoughts, and then sharing and processing and evaluating and connecting all the dots and pieces. Cutting out the human parts and automating all of that would end with a very different result.
Early this year, I represented a buyer who bought a house off market. The seller chose not to pay a real estate commission or to wait on the market for a buyer to get a loan, or to prepare his house for sale. He sold his house off market, all cash, to my buyer for 2,000,000. After the purchase closed, my buyers discovered that a different house would suit their needs better and they chose to sell the house they just bought so they could buy another house instead. As sellers, my buyers chose to sell the very same house a different way – with preparation, marketing, expert representation, and a long wait for a buyer to get a loan. We closed the sale of this same house this week for 2,270,000. The real life difference between doing it fast and cheap vs doing it paying commission and costs of preparation and time of sale was 270,000. Most people don’t buy and sell the same house in a short period of time, but it’s interesting to see the financial difference between doing the sale of the same house in the same condition and the same location in different ways. There’s too much financial value we add for computers to automate a job done well by a competent professional human.
As a real estate agent representing other people’s houses for sale, it’s a valuable experience to have my own house on the market for sale and to step into my client’s experience of my service. Like all my clients I’m a true fan of my house. The design is a representation of me – navy, black, & white, clean architectural detail and so much light everywhere. It has all the things I like in a house – center hall plan with high volume, four large bedroom suites upstairs and one down, a big combination kitchen/ family room/ breakfast room that opens to a large deck with bbq island and then grassy yard with pool, a two car garage that’s super easy to access with a direct quick path to the kitchen to unload groceries, a cool ADU with extra high ceilings and so many windows, and a basement with movie theater, wine room, huge storage/laundry room with dog washing station. I spent 10 months researching and evaluating the most comprehensive way to waterproof an existing Hancock Park basement and then 5 months and a huge amount of money waterproofing the absolutely right way with a lifetime warranty on it. It took almost a year to get HPOZ permission to add a 2 story addition to the main house, it took another year and a half to get HPOZ permission to tear down the one story original garage and to build a new 2 story ADU, and it took so many months to get DWP service for the new ADU given that all the electrical wires are buried underground in Hancock Park. I think the biggest benefit of buying a house that’s remodeled with so much effort is not having to live through all that construction yourself. Given my beliefs that houses attract people who belong in the house the same way the owners belong there, I can’t wait to meet the people who are drawn to my effort laden project!
Before Covid 19, almost all buyers chose to see houses during public open houses instead of by private appointment. When we hosted open houses, buyers often chose not to give their names or their information or to share very much as they walked through the house. Now that open houses aren’t allowed, all houses are shown only by private appointment with a signed form declaring that people don’t have symptoms of disease before they can enter with a mask. There is no anonymous breezing through houses any more. These days, people come and they ask so many questions and they share so many thoughts and the process is completely different. It’s all way more high contact and high connection. Everyone wants to know about the sellers and their story. Everyone wants to know about the neighbors and the block. Even though the house buying process was always inherently human, it stepped up a level and it became so much more human during this Corona period.
When we hire service professionals as consumers to guide us through an experience that’s both high stakes and laden with emotion, we need a combination of high level competence and high touch caring in the people we choose to represent us. Computers can never accomplish high touch caring or replace human to human negotiation by connection. I find that most buyers walk into a showing and immediately say some expression of wishing they could shake hands or give a hug or connect in a closer way than we’re allowed during Corona. And so I conclude that a computer will always just be a machine and no machine will ever replicate the priceless and wondrous creativity, spirit, and heart of a human.