Cloud-based virtual real estate brokerages, offshore labour, and designing and building emotionally and intellectually intelligent buildings will dramatically change the way agents work in the future, experts say.
The days of real estate agents existing solely in a bricks-and-mortar office are already dissolving, with US cloud brokerage eXp Realty hitting more than 10,000 agents and uplisting on the Nasdaq Stock Market late last month. The agency crossed the $1 billion market cap on its first day of trading.
Technological advances will see agents work from their homes, their cars and even overseas at increasing rates, while some areas of sales could be completely automated or sent offshore, as is already happening in property management.
The traditional real estate shopfront may also undergo remarkable changes; not only in the way it looks, but in the way it operates and thinks.
“Building design is not only about bits and bytes, but ﬂesh and bones.”
Yes, you did read that correctly. Our buildings are already beginning to analyse third-party and sensor-gathered data, such as weather forecasts and employee movement patterns, to automatically adjust things like temperature control and lighting.
Chris Rolls, Managing Director of PieLAB Venture Partners which invests in late-stage start-up businesses, particularly in the property industry, says real estate is “ripe for change”.Chris Hanley
“The real estate industry is in for massive change, brought on mostly through technology,” he says.
“In 2012, $221 million was invested, worldwide, in real estate-related technology. In 2016 that figure was
$2.66 billion and the figures for 2017 are rumoured to be about $8.4 billion. That’s aggressive growth in investment in real estate-related technology. The future of work is going to change everywhere.”
Chris believes the use of offshore labour and the automation of certain tasks, such as booking inspections, will increase significantly in coming years.
He says some property managers looking after Australian rentals are already located in the Philippines, and machine learning will also improve and take tasks off the to-do list.
“We’re already starting to see a lot of the manual, repetitive, low dollar-productive things head overseas. The outsourcing market in the Philippines is growing 17 per cent per annum. That’s across a whole range of professions, but I would argue that figure is greater in the real estate industry.
“Tenant contact, completing contracts, scheduling of routine inspections and lease renewal are all things that can be done overseas for a fifth of the cost. It’s good quality labour and it doesn’t have high turnover.”
Chris says personal assistant roles, including in sales, are also ripe to be pushed overseas, with tasks such as
CRM data entry, copywriting, trust account administration and management of marketing campaigns all able to be completed offshore or automated.
“When I had Rental Express we invented online inspection bookings … which automated the process for viewing the property to lease it,” he says.
Chris says the traditional real estate shopfront will also gradually disappear.
“Commissions as a percentage are declining, which means agencies won’t be able to afford the expensive rents and overheads that come with High Street frontages. Previously people had to come into an office to at least sign paperwork, but that doesn’t happen now.”
Founded in 2009 with just 25 agents, eXp Realty now has more than 10,400 agents spread across 49 US states, in addition to the District of Columbia and the Canadian provinces of Alberta and Ontario.
It is an entirely cloud-based brokerage with no bricks-and-mortar shopfronts.
“eXp Realty’s virtual office environment, compared to the traditional real estate office, allows agents to collaborate and learn together – no matter where they might be located,” eXp Realty President Vikki Bartholomae says.
“Our family of agents build their own businesses while having the opportunity to also establish a direct ownership interest in eXp World Holdings, eXp Realty’s holding company, as a shareholder and partner.”
The brokerage’s growth has been staggering, with the number of residential sales hitting 25,299 last year; up 212 per cent on the 8,100 properties sold in 2016.
In dollar value $6.1 billion worth of property was sold last year, up 209 per cent on the $2 billion sold in 2016.
“We don’t have the overhead costs of running a bricks-and-mortar brokerage, so we can invest that money in technology and support for our agents,” Vikki says.
“Agents no longer have to drive across town to the office to track down their broker or attend a meeting … everything is in the cloud and available wherever the agent or team is located.”
In Victoria’s Beaumaris, Diana Dugan Property is about to close its first sale through its virtual office, selling a property in the beachside suburb for a vendor in Indonesia.
“We have never met in person,” Director Diana Dugan says. “The first time we saw each other was in the virtual office and through that portal I have been able to introduce her to our staff members and meet her family.”
While she’s not ready to drop her shopfront just yet, she’s excited by the technological advancements in the industry. In her virtual office, clients see a two-dimensional floor plan complete with staff offices, a boardroom and reception. She’s also able to bring suppliers, such as financiers and interior designers, into the office simultaneously.
“The real estate industry is in for massive change, brought on mostly through technology.”
“When I entered the industry I spent most of my time out looking for sales leads or in people’s homes, and buyers and sellers rarely came into the office,” she says.
“With the introduction of the internet and cloud-based computing, it seemed a natural fit for real estate transactions to take place in a virtual office. To me, this was the way of the future.”
While most experts agree that real estate professionals will continue to work from varying, mobile locations, they also say the traditional office space is not dead yet.
Aurecon Buildings of the Future leader Peter Greaves predicts shared office spaces will become more popular in the industry, with multiple agencies in the one building or even on the same floor.
“This is something that will really work from an economics point of view,” he says.
Peter says designers often get caught up in putting technology in buildings for the sake of it and forget who the building is for people.
“Building design is not only about bits and bytes, but flesh and bones. We need to take a step back and remember that humans are at the centre of everything we do.”
“Agents no longer have to drive across town to the office or attend a meeting … everything is in the cloud.”
He says future buildings will likely include movable internal walls so spaces can be reconfigured, standing meeting rooms, greater use of natural light and technology that delivers feedback to users.
According to Aurecon’s Buildings of the Future: People at the Centre report, when its Melbourne base was designed it contained digital platforms to connect sensors throughout the building, walkways, bike racks, recreational areas and plants. The data collected allows the company to compare stair and lift use, measure bike facility use, monitor indoor air quality and optimise daylight, temperature and humidity levels.
“High tech is only high value if that same technology enhances human experience,” Peter says. “Research has shown that building design has a huge impact on staff motivation, satisfaction and retention.”
First National Byron Bay is currently redesigning its office space internally and will include configuring one team member’s office around the use of a kitchen table.
“Tara had her second baby in January and her team found out, through going to work at her place, that they were productive around her kitchen table,” Director Chris Hanley says.
“So we’re going to emulate that in her work space, with a kitchen table in the centre and individual desks around the outside. The bottom line is most people don’t do work at work. They get distracted. You need to provide and create spaces for people to do as much work at work as they can.”
Mr Hanley says creating a warm, inviting and collaborative culture within a workplace will become increasingly important in the future and a key driver of this will be the employment of women.
“Women collaborate much better than men; they’re competitive, but collaboration is logical to them. I think the future of work for more and more business owners and franchisees is to understand that if they build and maintain a great culture they will attract staff who stay longer and who are more productive.”
Compton Green Managing Director Adrian Butera says that, from a human resources perspective, the future of work involves allowing employees flexible working hours and even working from overseas.
“It started 12 months ago when we put a [social media] post out; we wanted to challenge the status quo. We wanted to let people know that if you need to pick the kids up you can, and if you can’t work every day of the week that’s OK too. You only needed to be able to work Saturdays. It has worked really well for us.”
Adrian says a salesman who fell in love with an intern who came to work for Compton Green from Berlin was able to work for the company after going to Germany for paternity leave when they had their first child.
“He could still work his database, call clients, log on and work remotely. It was offshoring with a difference. While he wasn’t physically selling he would send us leads and maintain all of those relationships. If you are disciplined and responsible you can work from anywhere you like; you don’t need a desk.”