Over the last 20 years, a phenomenon has taken place. A huge percentage of commerce, and therefore, the world has moved online. Today everything from fresh produce to cars is being bought online, often sight unseen. The key to this transformation — besides near exponential advances in computing power and cloud storage — is convenience. Purchasing property still remains highly inconvenient from the consumer perspective. To many, it begins to feel like a full-time job. Real estate transactions still rely on physical paperwork, notaries, numerous stakeholders and face-to-face meetings.
Tradition has trumped efficiency thus far in the world of real estate transactions, but it won’t be like this forever. Real estate transactions online are coming sooner than you think. That may be music to the ears of consumers, but to many real estate professionals who are entrenched in (and highly efficient at) the current way of doing business, it may seem more like a death knell.
From our experience working with real estate service providers that conduct every process point in a real estate transaction, we have some intuition about how this will all come about. Here’s what you need to know.
From Many Portals to One
As it stands, all the parties in a real estate transaction use relatively new cloud-based portals that save time and money. Most of these tools didn’t exist 15 years ago.
Consumers use listing portals like Zillow and Redfin to find homes and get in contact with real estate agents. Lenders and title companies use title and escrow software like Qualia or ResWare to collaborate with one another to streamline the closing.
Yet, these portals are not connected with one another. Each stakeholder uses technology that makes their small part of the real estate transaction easier, but the work from each system must be combined and moved from stakeholder to stakeholder in a manual fashion.
These various portals will be stitched together along with a digital mortgage platform so that consumers can do everything in one place: find a home, compare real estate agents, apply for a mortgage, etc. In the long-run, consolidating the real estate transaction into one platform will also be beneficial for real estate professionals.
What the platform will look like and who will create it still remains to be seen, but we would put our money on a tech giant like Amazon or Google teaming up with a tech-savvy mortgage giant like QuickenLoans. The need for such an all-in-one portal all but assures that one will be created, and whoever does will have won real estate 2.0. Stay tuned.
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