Navigating the New Normal: PropTech in the Post-settlement World

By Joe Schneider | August 19, 2024

As we speed towards the end of a tumultuous and challenging year for real estate, we prepare to transition to an industry-wide revenue model centered on increased consumer transparency and the ability for agents to express their value to those consumers. 

 

Without having to subject everyone to a mind-numbing recap of the result of the industry lawsuits (you should know this by now), I’ll sum it up: buyers will now be choosing agents based on two factors - what they can afford, and how much value a buyer's agent can add relative to their competitors. This tip-of-the-spear for real estate transactions has been redefined, and as a result, the relationship dynamics in any real estate transaction have also shifted. 

 

The bottom line: buyer’s agents need to demonstrate value to consumers. This presents an opportunity for PropTech companies uniquely positioned to enhance, display, augment, or otherwise increase the value that the buyer’s agent offers to the consumer. 

 

Technologies helping Buyers agents in the new normal

 

With the PropTech industry's massive growth and scaling over the past decade, there has understandably been a massive amount of verticalization and segmentation in the space. While all verticals solve important needs, not all solve for the opportunities that lie ahead of us with the practice changes. 

 

Since the initial framework of the settlement agreement was revealed in May, industry incumbents have taken big leaps to help speed up the transition to the new normal. Both Zillow and eXp developed new agreements that agents could use to help usher in the new compliance rules and bring agents closer to their orbits. 

 

In addition to these practice changes, the agents who will win business in the future will be the ones who go above and beyond and consistently justify their value by providing their clients with a world-class experience that prioritizes transparency, efficiency, and added value. 

 

Agents who utilize technologies like collaborative home search, advanced, in-depth property and market reports, interactive transaction management platforms, and any other tools that enhance the client experience will create a process that clarifies every step of the home-buying journey. 

 

These agents will meet and exceed client expectations by offering transparency, efficiency, and personalized insights. By leveraging these technologies, agents can foster trust and confidence, ensuring that clients feel informed and empowered throughout the entire transaction process and differentiate themselves from the agents who have not embraced these technology changes. 

 

Connecting the Right Technologies to the Right Brokerages 

 

While agents and brokerages should be rushing to research, source, and ultimately integrate these technologies into their business, the sheer volume of available PropTech solutions can be overwhelming. So, how can your PropTech solution stand out to brokerages when purchasing?

 

1. Demonstrate Immediate ROI:

Brokerages are looking for technologies that can immediately impact their bottom line. Whether it’s through increased efficiency, better client engagement, or streamlined processes, your PropTech solution must clearly communicate the tangible benefits it brings.

 

2. Offer Scalability and Flexibility:

Brokerages need solutions that can grow with them and adapt to changing market conditions. Highlight how your technology can scale across different markets, accommodate various team sizes, and integrate with existing systems without causing disruptions.

 

3. Focus on User Experience:

A user-friendly interface and intuitive design are crucial. Brokerages will prioritize technologies that are easy to adopt, minimize the learning curve, and provide a seamless experience for both agents and clients. Demonstrating how your product enhances user experience can set you apart in a crowded market.

 

4. Highlight Compliance and Security Features:

With the new compliance rules, brokerages are more cautious than ever about legal implications. Ensure that your PropTech solution addresses these concerns by offering robust compliance features and strong data security protocols, making it easier for brokerages to stay within regulatory boundaries.

 

5. Build Strong Support and Training Programs:

Even the best technology can fall flat if not properly implemented. Offering comprehensive training and ongoing support will reassure brokerages that they can rely on your solution long-term. Demonstrating your commitment to their success can be a key differentiator.

 

6. Find the Right Distribution Channels:

Selling to brokerages can be a daunting task, to say the least. Brokers and agents are notoriously busy and rarely stationary enough to catch them at their office. Meet them where they’re at, the MLS. Many progressive MLSs have partnered with great tech companies to promote their products and services as a member benefit. If your product is solving a problem that its members are experiencing, most MLSs will jump at the opportunity to partner with you and solve that problem. 

 

Leading the Charge with PropTech

 

As the real estate industry continues to evolve in the post-settlement world, the role of PropTech in driving success cannot be overstated. Agents and brokerages that strategically adopt and integrate the right technologies will not only adapt to the new normal, but also lead the charge of setting new standards and client expectations for the industry.

 

By focusing on the agent’s ability to deliver value, enhancing client experiences, and ensuring compliance, PropTech companies can become indispensable partners in the future of real estate. As we progress, those who can effectively connect their solutions with brokerages' needs will be best positioned to thrive in our new normal.