What Technology Can’t Do For Us
Every year, new real estate companies appear on the New York scene. Often they fail. One way or another, they tell us in their promotional materials, they are going to revolutionize the industry. First Foxton’s came in with their ultra-reduced commission model. They could not get traction in either the broker or the exclusive marketplaces: good agents did not want to go to work for them and so they were unable to list good properties. Soon they were gone. Then there was a wave of firms whose differentiating allure was a radical and pumped up approach to marketing. While mostly these firms and their CEOs were savvier, they too did not fundamentally alter the marketplace (although seller expectations about marketing have become more sophisticated in recent years.) Some of these firms are still around, some not. For many, it has been easier to penetrate the rental than the sales market, rentals being much more transient and less relationship-focused.
The newest round of companies trying to alter the traditional brokerage model are technology-based. They believe that technology is the answer to everything, and that therefore there MUST be an on-line formula through which agents can be disintermediated. Maybe I am old-fashioned in saying this, but I just don’t think so. Our industry has certainly been changed by technology, mostly for the good. There is much more transparency. The consumer is far better informed. Agents have had to clearly define how they add value, which has sharpened our skills. But for a number of reasons I don’t believe the agent is replaceable in most residential sales transactions.
First, there is the emotional component. No technology can provide the support and encouragement of a good agent in getting a deal done. This is particularly true in co-ops, the purchase of which requires both a complete understanding of what Boards of Directors require and an enormous attention to detail, combined with the hand-holding that makes the self-revelation, if not palatable, at least bearable. When a client is making such a big decision, a good agent is like a supportive friend with a lot of expertise.
Second, there is the issue of negotiation. Few of us negotiate effectively on our own behalf; we are either too aggressive or too accommodating. I have seen this in myself and in many other agents whose skills when representing others are enormous. An agent can help you both not to overvalue what you have and not to undervalue what the other person has; these are the pitfalls into which sellers and buyers most often fall. And no-one can help as much as the agent when a deal is down to the wire and one participant or the other threatens to blow it all up because the short term desire to win clouds the long term desire to find the right home!
Third, there is no fuzzy logic program which can expand buyer horizons like an experienced agent. We listen. What we hear then informs how we guide the process. When we listen carefully, we may even understand more about how to satisfy our buyers’ dreams than they understand themselves. So we can steer them to a neighborhood, or a building, or a property size they would not have considered on their own because we can sometimes intuitively KNOW that the right thing is a little off the beaten path.
Agents are slower than computers. Technology can be dazzling, while often we are not! But when the big decisions are on the table, Barbra Streisand had it right: people need people.