Why Zillow Will Never Replace the Traditional Real Estate Agent
Over the past decade, the Internet has infiltrated the housing market by way of online real estate marketplaces. As they rope in a portion of the home buying market, these startups often undercut standard agent commissions. In some cases, they even offer online transaction platform that eliminates the need for an agent altogether. Still, despite making obvious inroads, websites like Zillow aren’t likely to wrestle away command of market share anytime soon.
According to the National Association of Realtors, about 90 percent of consumers begin their real estate journeys on the Internet. Zillow and other online platforms have parlayed this tendency into millions of dollars in profits. At first glance, these electronic marketplaces look similar to the ones that defeated travel agents, print classifieds, stock brokers and car dealers. In reality, however, they haven’t managed to dent the fortunes of agents.
Recent surveys found that, although 42 percent of buyers find their home using the Internet, 89 percent use an agent or broker to make the purchase. Not only have agents withstood the barrage of Internet attacks, but they seem to be doing better than ever. According to the research firm, Real Trends, average commissions remain above 5 percent of a property’s value and have actually increased over the past few years.
Agents Still Necessary
While agents continue to hold their ground against rising technology, there’s no doubt that sites like Zillow have changed the role of the professional. In the past, an agent’s role was to provide access to an exclusive database of information. Now that this information is out in the open, buyers see the same things as the professional. That said, because real estate is such an expensive, emotional and personal transaction, there will always be a need for an intermediary.
Real estate continues to be a relationship-centric business, and algorithms and scripts cannot replace these relationships. At the same time, to thrive in a shifting landscape, agents will need to adapt. The ones who do so successfully will be the ones who fulfill their roles as trusted guide and fierce, honest guardian of a client’s interests.
Likewise, since Zillow and other online information has made modern consumers better informed about the real estate process, agents must know key market statistics like the backs of their hands. They must also master the things outside of a computer’s capabilities, including sensitive situations, conflict resolution and other challenges that demand an intuitive, personal touch.
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