Consumers are being bombarded with a host of seemingly new home sales ideas/concepts. Companies like Homelight, Upnest, Movoto, Redfin, Offerpad, Homie, Compass, TopAgents, and Zillow have all become major media buyers. As a matter of fact, 3 more companies just got their Series A funding as I completed that last sentence. But, are any of these ideas actually, “new”?
The “i-buyer” movement is nothing more than a sexed up version of those hand-scrawled, “we buy houses”, signs from the side of the road. Low-ball flippers specializing in thin-coat gloss overs is NOT a new idea. It’s just now done on a massive scale. Legitimizing these types with tons of venture investment is the new element here. Cleans up real nice.
Many of the other “new” solutions equate to nothing more than commission cutting. Again, not new! It’s been 50 years since that new upstart ReMax first allowed their agents to discount commission percentages. Think of that—50 years and the industry is still waffling between 5% and 6%. WTF?
Another set of new voices confusing consumers are the “agent finders”. These companies all promote wildly unfounded claims of their sales agents selling homes quicker and for more money than traditional agents. Toeing the line of fraud, but somehow never crossing it? In reality, these companies’ team sales agents up, meaning agents who pay them, with random phone numbers, they call “leads”, in a strategy to extract a percentage of the agent’s commission. It’s a marketing trick. Sad, but certainly not new.
Developing the next big thing in real estate is made harder because the industry is so broad. Trying to create a solution that works across every way society chooses to live just might be a fool’s goal. Logic tells us change happens one step at a time. As a society, we rarely leap. Given that, what would be the segment of our industry representing the lowest hanging fruit for change?
The business rules of real estate were principally established for the buying and selling of single family homes. Absolutely critical to the development of suburbia. Such widespread deployment tells us, this is NOT the segment of our industry ripe for easy change. Hence the decades of stagnation. Look elsewhere.
Many franchise Realtors like to market themselves as their client’s “realty partner”. While this sounds great out of the “cliché-o-meter”, in truth, it’s kind of funny in an absurdist way. Bottom line; many of us actually have realty partners we aren’t really aware of; they’re called HOAs.
For most living in suburbia, HOAs are a pain the ass. It seems their entire mission in life is to make their homeowner’s lives miserable. For a large majority of us, news from the HOA is rarely celebratory. But not all HOAs are the same. Some HOAs are far more intimate with their members.
HOAs in hi-rise condominiums, act and function, very differently from the HOAs found in suburban swim/tennis communities. HOAs for small town home communities are far more critical to its members than any other type of housing.
People can buy single family suburban homes with little or no thought toward an HOA. People buying into small town home communities who don’t factor the HOA into their buying decision are taking huge gambles. The wild disparity in the roles of HOAs indicates market segments with the most to gain from radical change. Simply put, the more important an HOA is to a home seller, the more likely the need for change. Turns out, HOAs are the key.
Over the next 2 blogs we will be detailing radical changes for both the condominium and small town home community sales structures. Both of these types of communities require high-touch HOAs. The goal is to create a sales solution benefiting not only the home seller but the greater community at large. And yes, we are saying, the proverbial win/win.
The losers, real estate agents. At least some real estate agents. Condo’s and town homes have shared resources and common areas. Their HOAs are forever looking for cost savings and efficiency. Sales solutions for these market segments should incorporate that same mentality. Efficiency in real estate? Are you mad! If that were to happen, fewer agents would be needed. Well, that’s the point.
Next up: The Community Realty – The Hi-Rise Condominium