Unless you can articulate why you are essential to your clients, and what value you provide that big data metrics and Artificial IntelligenceI cannot, you will be out of business. Very soon. This is the case for many residential real estate brokers. But not me.
Big data metrics provide facts and statistics. Average and mean prices, for example, and asking and selling prices of particular properties. It can spot trends. And can help with home search; input the search criteria and out comes listing options.
AI can be used to write web descriptions ("ChatGPT - write me web copy for a $20,000/mo 2 bedroom rental in Hudson Yards") and to generate personal reference letters for a coop board applicant.
So, do consumers really need residential real estate brokers? In a word, YES!
For the same reasons they need good wealth advisors - to understand the nuances of the market and how it affects them
For the same reasons they need attorneys, CPAs, mortgage brokers, photographers. architects and contractors - to leverage their knowledge and experience and guide them through the process, get better results and to complete the job most efficiently
For the same reasons they need any professional - to help understand a client's changing needs and to find the best solution, given the consumer's unique circumstances.
To save time and money.
Speaking of time - big data metrics and AI do not have any way of knowing what's happening in the market AT THE MOMENT. Statistics are delayed months until either closing or contract signing. Brokers understand the immediate flavor of the market as soon as a property is listed, from attendance at the open houses and the enthusiasm or lack thereof by prospective purchasers.
Big data cannot understand the nuances of the statistics or the subjective nature of why a property is more or less valuable. Why, for example, did a property sell for so much more (the buyer paid a premium to be close to a family member) or so much less (it was on the same floor as a heavy smoker), or why certain buildings sell better than others.
Computers cannot fully understand the specifics of a client's situation, or effectively analyze how a client will be affected by market conditions. Computers don't know which homes smell good and which ones have better views, nor do they have experience negotiating the best deal for a client.
The Secret Sauce to good real estate brokerage and successful transactions, with minimal stress, involves the following skills that AI does not provide -
A. Asking the right questions to empower clients to make smart choices
- The usuals
a. What is your budget?
b. When do you need to move?
c. What are the parameters of your search?
d. What are your favorite features of your home?
- Questions that cause clients to stop and think
a. What is your decision making style?
b. Who in the household will the move be most difficult for? Why?
c. What is your negotiating strategy?
d. Who is your target audience, and how do we reach them?
e. How risk averse are you?
f. How do you intend to coordinate the logistics of moving?
g. Who are the other professionals who will guide you through this process?
B. Really hearing a client's answers
- reading between the lines
- interpreting body language
- catching the tone of voice
- asking probing follow up questions
a. Why is that important to you?
b. Tell me more.
C. Recognizing that during a transaction, a client's priorities emerge and change.
D. Customizing advice to the client, the circumstances and the timing.
E. Validating a client's perception
- that the property and the deal is the right one, or not
- that the deal will actually make it to the closing table, or not
F. Being empathetic, understanding, compassionate and kind
G. Understanding the subjective - how big is big enough; what is a client's aesthetic style
Big data metrics and AI are tools that help when used properly. We need to leverage technology to our benefit, making us more efficient and smarter. And our clients need the human touch of a smart and skilled broker, and not machines, to REALLY listen and effectively advise them through their most important of life's decisions.