2020 was a year that forced a number of industries to modernize and adopt technologies that had been otherwise underutilized. For the housing economy in particular, tech helped to solve many of the challenges that COVID presented and allowed the industry to not only sustain, but prosper.
“In 2021, technology will no longer be a ‘nice to have,’ but a must for building trust and standing out amidst an abundance of competitors in the wake of the pandemic,” said John Berkowitz, CEO of OJO Labs. “With the right tech stack, agents and brokers have access to rich market insights at their fingertips, the ability to provide virtual home tours…and a deeper understanding of what consumers really want in a home.”
According to Berkowitz, those that embrace technology will distinguish themselves as stand-out industry leaders, while those that remain ambivalent will struggle to meet consumer needs.
OJO Labs, a real estate artificial intelligence platform, is a 2020 Tech100 Real Estate award recipient. The Tech100 Real Estate awards recognize the companies that are driving innovation in real estate. Nominations close this Friday, December 18.
HousingWire reached out to Berkowitz to learn how real estate tech is playing a role in the current housing boom and what homebuyer trends will look like in the new year.
HousingWire: What kind of real estate market do you expect to see headed into 2021?
John Berkowitz: In 2021, the housing market faces yet another year of uncertainty. From the new administration to the promise of a COVID-19 vaccine, there are so many forces at play that significantly impact the industry at large; it’s impossible to predict for certain the state of the market in the new year. In fact, our Chief Real Estate Officer has a completely different take than my own, so we’re preparing for anything and everything.
However, I do believe that we will continue to see a significant housing boom through 2021. With the virus spiking and new lockdown orders, I don’t foresee significant change in fiscal policy or the record low interest rates we’ve encountered throughout 2020. What’s more, coming off an election year, it takes time for new government policies to come into play with the turnover. As such, ongoing low rates will spur demand into the new year, even when it would typically slow down. With all of these factors taken into consideration, the housing market is trending towards continued growth.
Meanwhile, the impact of COVID-19 on homebuyer trends and habits will also fuel a strong market. Today, there are more platforms than ever before to access and buy homes, and agents and consumers alike have leaned on technology to identify and sell the right properties. Additionally, homebuyers continue to look for new homes to be closer to family or meet new preferences, such as bigger backyards or more open space within the home. Paired with the fast turnover rate, these preferences will continue to drive high demand.
HW: What can brokerages and agents do to make sure they’re staying competitive?
JB: While there are differing opinions internally at OJO Labs on how the market will play out, there is one thing we all agree on: 2021 will be the year of the tech-enabled agent. There’s tremendous opportunity for brokerages and agents to differentiate themselves as they guide consumers through the unknowns of the pandemic, a new administration, and an evolving market.
In 2021, technology will no longer be a “nice to have,” but a must for building trust and standing out amidst an abundance of competitors in the wake of the pandemic. With the right tech stack, agents and brokers have access to rich market insights at their fingertips, the ability to provide virtual home tours made necessary by the pandemic, and a deeper understanding of what consumers really want in a home. What’s more, the way consumers and agents communicate has transformed, with text, email, and digital apps more important than ever before. Our research found at the onset of the pandemic, 41% of people who still planned to purchase a home reported an increase in remote communication with their agents including text, email, phone, and video. Consumer expectations for agent accessibility and outreach are high, and will carry on through the new year—agents and brokers need solutions that will connect them with consumers within seconds.
Ultimately, those that embrace technology will distinguish themselves as stand-out industry leaders, while those that remain ambivalent will struggle to meet consumer needs.
In addition, I fundamentally believe that challenging times provide a unique opportunity for outsized growth. Once core survival is secured, identifying ways to capitalize on a crisis can accelerate your business. Staying competitive is a precursor to thriving – and agents and brokers who take risks and make moves that others can’t or won’t make are going to be best positioned to come out of this even stronger.
HW: How is a strong focus on real estate tech especially important during these times?
JB: As real estate technology gained momentum over the last decade, industry experts were concerned that new innovations would displace or diminish jobs. But that’s not how things have played out. Instead, the need for a great agent is stronger than ever. Buying a home is one of life’s biggest decisions—both technology and industry experts play an important role in helping consumers make the right decision.
Even amidst a pandemic, consumers want to find a home that fits their needs. And their desire to make more confident decisions hasn’t changed either. Yet, it’s likely preferences and needs have evolved — concerns about commute time may be less acute, while there may be increased worry about mortgage costs. Real estate tech can help surface those nuanced signals and arm agents with the insights they need to support buyers along their journey.
Technology is also able to fill many of the gaps that emerged from the pandemic. The number of virtual tours will only continue to rise. We’re already seeing this play out. Take Austin, for example, where the availability of traditional virtual tours grew by 147% between March 2020 and August 2020, while the use of enhanced virtual tours grew 1147% over that same time period. Many of these use cases have emerged due to social distancing and shelter-in-place orders, and I expect that many will transform the way we buy and sell homes in the long run.
This year has significantly accelerated technology adoption and real estate tech will continue to play an important role in 2021. Homebuyers and sellers have come to expect a seamless, on-demand experience in normal times or otherwise. Thus, agents and brokers will continue to leverage technology to find a home that fits in today’s remote-first world, and beyond.