COVID-19 Is A Time Machine
“If My Calculations Are Correct, When This Baby Hits 88 Miles Per Hour, You're Gonna See Some Serious S***.” - Doc Brown, Back to the Future
In many ways, the outbreak of COVID-19 has been a lot like putting the foot down in the DeLorean and rocketing toward our own professional futures.
Take the very popular video conferencing application, Zoom for instance. Since February, Zoom’s share price has doubled to US$150 per share, valuing the company at almost 42 billion US dollars.
Just think about that for a second… Stock markets around the globe are plummeting and this tech company, Zoom adds $20 billion to its market capitalisation. Why?
If you said “working from home”, you’d be partially correct. The other thing to remember is Zoom’s addressable market (in or out of lockdown) just got a whole lot bigger. Every customer acquired during lockdown is likely to remain a customer after lockdown, too.
As far as real estate goes, there are some interesting trends emerging that I think are worth considering if you’re running an agency.
Passive vs active marketing
Applications such as Soho seem to be occupying an interesting place between “on-market” and “off-market”, targeting buyers and sellers, with or without agencies. They also seem to have sprinkled some social media elements and smarts into their offering too, adding “swipe” left or right, which ultimately help the application learn buyer preferences.
This is an interesting proposition for agents and gives them another arrow in the quiver when having listing conversations and discussing potential sale strategies with owners. Running a five or six week auction campaign may not always be the best strategy. The property may be unique and require a certain type of buyer and a longer time on or off-market, as the case may be.
Outsourcing (with technology)
One way of viewing a sales agent and property manager is through the lens of a project manager, as they’re usually the most consistent reference point in a real estate transaction. Something I’m seeing lately though, is better adoption of technology that’s allowing sales agents and PMs to step out the dog’s body role and into one with better customer engagement.
On the sales front, having tools like Homepass can harmonise your team and manage open homes and private appointments.
In property management, it’s nice to see tools like Snug take the hard work out of tenant applications screening, allowing PMs to do more with less (more managements per PM).
Working smarter, not harder as the old saying goes.
Virtual everything
Today I was forwarded a deal sheet for a private placement in a small company, Asset Owl (ASX:AO1). Their flagship products are Inspector Asset and Inspector 360, which seem to be two very sophisticated virtual inspection apps.
You would think in a market like real estate, where the commodity couldn’t get more physical, that virtual inspections just aren’t gonna take. Well, thanks to COVID-19 the stock price of this company just took off!
Having just exchanged on a new property myself, I can tell you screening and pre-screening is critical. The less open homes and private inspections I have to go to, especially with a pandemic going on, the better. The benefit for sales and leasing agents is this technology is better qualifying the buyer requesting physical private appointments.
Virtual auctions is another COVID-19 adaptation that I’m damn impressed with. Even after lockdowns lift, I think we’ll see it continue to be a feature of the buying landscape. AuctionNow, Anywhere Auction and Openn Negotiation are doing a great job at facilitating this with video conferencing, bidder registration and a bidding framework for when the auction is underway.
Notwithstanding COVID-19 I think the great thing about virtual auctions is there will always be out of town bidders and those that can’t get to the property or auction room. Auction rooms can also be intimidating and whilst it might create competitive tension can have the opposite effect, when first time buyers are paralysed by the pressure of the room.
As always, food for thought.
