50: Virtual Real Estate
If you’re selling a house and primarily showing it via VR, you don’t have the cost or hassle of staging, and there’s no need to clean between showings.
About This Episode
The global pandemic has pushed business online in ways we've never seen before. Real estate agents had to adapt and learn how to work around new restrictions, but was COVID-19 a breaking point for remote work technology?
We explore the possible futures of real estate and how transformative new technologies like AR and VR might change industry as we know it.
Download a free ebook about VR: How to Use Virtual Reality for Real Estate Marketing
Download a free ebook about iBuying: iBuying What You Need to Know
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JON: If you’re like me, this was your fifth full month of remote work. Even for those who were already working remotely, COVID-19 has been a completely unprecedented event, to say the least. Many technology companies have been able to reap the rewards, as Apple nears a valuation of $2 trillion and Zoom has become a common app for Americans from all walks of life.
JON: So what is this doing to real estate? In many metros, the market is actually looking fairly healthy at the moment despite low inventory. An interesting side effect of everyone being confined to their home for so long is that the desire to change or leave that home has finally been acted upon. Many people have moved, thousands of homes have changed hands, and suddenly the suburbs are having their time in the spotlight as city dwellers seek more space to be socially distant in.
JON: Although home listings are hot around the country, coronavirus has made sure that many of our day-to-day activities will never look the same. In real estate, an industry that requires lots of opening of doors and touching of homes, the entire homebuying experience has been turned on its head.
JON: Hello and welcome to Shop Talk: The Real Estate Show. I’m Jon Forisha, and on this episode we dive into the virtual world of real estate, how it’s changing, and what the future of our industry may look like.
JON: Virtual reality isn’t a new concept, nor is it particularly complicated in theory. Even confined to the home you’ve come to know so well, you could put on a VR headset and be transported anywhere you want. Explore London, Paris, or Greece - or maybe even be transported off the planet entirely and walk on the moon or sword fight with orcs in Middle Earth. There are no limits, so long as a VR experience can be rendered into the tiny screens of your VR headset.
JON: Much like when the iPhone reinvented cell phones, it’s that blank slate aspect of VR that’s so exciting. The applications for VR are endless, especially when paired with the promises of ultra-fast 5G cell coverage. Couple VR with robotics and a highly-skilled surgeon could essentially perform surgery on anyone from anywhere. In real estate, it makes it a lot easier to buy a property remotely, since although you still aren’t actually seeing it, you are in some essence experiencing it.
JON: One side effect that’s surprised many is the amount of people leaving cities in the wake of the pandemic. It’s pretty self-evident why you’d want to get out of a tiny New York apartment and head for less congested spaces during a viral outbreak, but many people are wondering if the shift will last. After all, after the outbound migrations in the wake of 9/11 or The Great Recession, people eventually returned. Regardless of if they do or don’t come back to the big city, there’s a large swath of remote buyers at the moment, and the easier it is to get a feel for a property from a distance, the more people will take that route. According to NAR, in 1981 22% of homebuyers read newspaper ads to find a home. In 2018, 44% started their search by looking online. Who knows what that stat will look like in a few more years.
JON: There are plenty of dystopian views of how this or similar technology might further isolate us, but let’s instead spend this episode looking at the positive aspects. During COVID-19, it’s not possible or at least not advisable to be around many people in person, but no one’s ever caught a virus from a virtual setting.
JON: To tell us more about the current state of virtual reality, here’s Brett Van Alstine, Regional Content and Social Media Specialist at The CE Shop:
JON: So you recently wrote an ebook all about AR and VR. Is that right?
BRETT: Yes, I did.
JON: So could you tell us what is the difference between AR and VR?
BRETT: Yeah, for sure. So AR that stands for augmented reality and the best way to describe that would be, it's kind of, it's adding a dimension to the world that you're looking at already, if that makes any sense. So an example of that would be the newest filter on Instagram or Snapchat, or even Pokemon Go was probably the best example where the user will hold up their phone in a given area and a different Pokemon character will pop up and then they can touch it. I don't know, whatever, however, that works. That’s how that goes. And then VR is virtual reality. And that's probably the more common one that you hear about for this, this is a complete immersion experience into a different world where the world that you're in the current reality that you're in is completely closed off. With VR, you have to put on a device, you have to use a device that's not a smartphone. So that would look like one of those Oculus Rifts kind of had devices that goes over your eyes or one of the cheaper models. There's those Google cardboard cutouts. I think a lot of people may have seen that a couple of years ago, but those would be good examples of what VR looks like. And it's kind of hard to describe it because it's not like the Snapchat filters where everyone is using it and I have to put on a headset and really immerse yourself in that new world.
JON: Yeah. It's a little harder to do that in public, right? Cause you've got this big thing on your head.
BRETT: Exactly. And you have to move around and you're moving your hands, you're interacting. So you kind of need some space.
JON: So why are these technologies potentially such a big deal?
BRETT: Well, I think a couple of years ago, VR and AR was kind of coming out and people thought that this was going to be the next big thing in marketing. And then it really wasn't, no one was really using it. Maybe you could go to a trade show and at the booth they would have a VR headset that you could throw on and kind of try new immersion experience and then it kind of fizzled out. But now currently with COVID and everyone's lives kind of being put on halt and I'm going to stay at home a little bit more. There's been a real kindling of VR and AR, especially with real estate giving homeowners that safety of shopping around for houses from the comfort of their couch.
JON: As you say, a lot of tech companies have gotten behind this power Facebook, Google, Samsung, Apple, they've all in their own ways, sort of dabbled in these new technologies. Are there any big developments coming because of our current pandemic?
BRETT: So what I've read about so far is the newest developments are kind of just advancements within the device itself. So making it a smoother process making the visual quality a lot higher as far as what you're seeing in this new world and when you're interacting with. And then I think the coolest thing that people might be interested in is they're working on a treadmill that can be used in a VR world so that you're not having to worry about the space that you're working with. You can hop on this platform and really run around and walk around and kind of get a better sense for the world that you're in instead of having to have people kind of monitor where you're in another room so that you don't bump into the wall or knock the TV over or something like that.
JON: So how can real estate agents start to use this and their day to day business?
BRETT: So I think the biggest thing for real estate agents is that obviously right now there's a huge demand for homeowners to be able to safely shop around for homes. So real estate agents, the biggest thing is figuring out who that audience is for you and then figuring out what sort of needs you really need to be met. So do you need AR or do you need VR? Would AR be okay as far as being able to show a house and maybe show a homeowner, what pieces of furniture would look like in the living room, or do you need to deliver this full experience of immersing the homeowner in this new home that they've never stepped foot in that might not even exist? And that might be built in the future depending on what they would like feature-wise or appliance wise in that house. So I think it's important for real estate agents to figure out what their needs are. And then from there, figure out what companies in the area, or even nationally would be able to meet those, those areas of opportunity.
JON: Yeah. That's good advice. I mean, not, not to just go for the technology because it's there, but figure out what you need and then see how the technology can help.
BRETT: I think it's important obviously for the real estate agent to figure out again what their needs are for selling a home. Cause you might get a VR company to come in and say, this isn't what we usually work with. This is kind of the service that we provide. And then you've kind of dug yourself in a hole that you didn't need to be in, in the first place.
JON: Yeah. So do you think our future is going to be everyone meeting with clients entirely virtually all of us interacting in a virtual space wearing headsets?
BRETT: No, maybe for the next year, depending on social distancing guidelines, but I don't think real estate will ever be a contactless service just because people always want to work with people. And at the end of the day, I think that's how it works best.
JON: Yeah. Totally agree. Well thanks for joining us.
BRETT: Yeah, no problem, Jon. Thanks for having me.
JON: After the break, we discuss companies incorporating virtual reality in intelligent new ways.
JON: Virtual sales calls are fine, but virtual happy hours are a bit more tame than the old ones used to be. Not everything can be improved upon by taking place online, but you know what can? Completing your real estate education with The CE Shop. Instead of sitting in traffic or having to carve out that extra time just for travel to and from the classroom, you could sit back on your couch and absorb the essentials of a great real estate career. Right now you can save 25% on your real estate education at The CE Shop with promo code SHOPTALK.
JON: It’s telling that the mobile game Pokemon Go is still the best mainstream example of Augmented Reality, and that was released four years ago. While we wait for a genuine breakthrough of this technology, there have been plenty of companies trying their hand at getting AR and VR to catch on in smaller, more niche ways.
JON: You’ve likely come across virtual walkthroughs from companies like Matterport, which let a photographer scan a house’s entire interior, square foot by square foot, and then stitches it all together to create a seamless virtual experience. The effect is pretty neat, and can give a prospective buyer a good feel for a home. Sure, it’s not like standing in the living room, but for remote buyers this is an excellent new option that goes beyond the typical video walkthrough.
JON: RoOomy, with three o’s, specializes in virtual staging. The reason home staging can be so difficult is that every person has their own style, and just because the seller loves a beachy theme doesn’t mean the buyer will like it, and it may stop an otherwise great deal from going through. Virtual staging means that anyone can style a space however they’d like and really be able to see the potential the space provides outside of anyone’s questionable artwork or hideous couch.
JON: There are some Augmented Reality apps you can get on your tablet or smartphone that let you see furniture in your own space, and it’s becoming more common for brands like IKEA and Target to allow you to virtually see various products in your room through the use of your device’s camera. This could further erode that fear of buying online, that the thing you liked on a website may not look very good once you actually get it in your house. By seeing it in your house first, you’re less likely to return it.
JON: You might think that something as fancy as a fully-rendered VR experience would be prohibitively expensive, but it may surprise you. If you’re selling a house and primarily showing it via VR, you don’t have the cost or hassle of staging, and there’s no need to clean between showings. There are fewer marketing materials to create, and nothing to print. If VR is the focus of your listing, you can really put your efforts and dollars into making the best virtual experience possible.
JON: Like other forms of digital marketing, tracking the effectiveness of these efforts is second nature. In the past, you would buy time on a billboard or bus bench and you’d slap your face on it with your most charming smile, and you’d hope that people called you. Nowadays, it’s hard to justify spending on a billboard when Facebook advertising or a pay-per-click ad on Google can get way more targeted and show you immediate trackable results.
JON: VR is the same way. You’ll always know how many people viewed your VR creation, how long they spent checking out the house, and what features they were most interested in. Maybe you thought the kitchen would be the selling point but data shows that they’re all marveling at the master bathroom. Data doesn’t lie, and understanding where your potential buyers are looking can help you best set the stage for them to be wowed.
JON: As coronavirus makes us all accept our future of mostly remote work, some in the real estate space are better equipped than others. Much has been said about the rather new technology behind iBuying, and we actually have an ebook on the topic that’s linked to in our show notes. When you look at the financials, though, iBuying still doesn’t make sense for most sellers patient enough to wait through the usual buy cycle. The future may look like some blend of a traditional deal and iBuying, with particular focus on convenience.
JON: eXp Realty is a brokerage built entirely around remote work. Their big selling point is that you can work from anywhere and not travel to an office, along with their other non-conventional points like employee stock sharing. But the reason I bring them up in an episode about virtual real estate is that they have a little something called eXp World, and it looks suspiciously like a video game.
JON: Though it resembles The Sims or Minecraft, eXp World is actually eXp’s entirely-virtual meeting space. They hold large meetings in eXp World, they have a convention center where you might find The CE Shop, and they even have a virtual bar set up for virtual happy hours. While the rest of us struggle through unmuting at key moments on a Zoom call, eXp has embraced our virtual future and built their own world to cope with it.
JON: Now, is this the future? If you’ve been licensed a long time, you might view this with a skeptical side-eye. Bold predictions normally don’t pan out, after all, and as odd as things have been these last five months, we surely won’t be wearing masks for the rest of our lives. Looking at the data, though, COVID-19 might have been a breaking point for the adoption of remote work technology. A lot of these technologies aren’t new - Zoom is almost a decade old, for instance - but never before have so many people been subjected to them at one time.
JON: Where many before may have become frustrated with the limitations of remote work technology and walked away from it, during covid none of us could. It was either adapt and work with it or stop working altogether, and the latter is not a viable option so suddenly we all got better at video calls and emails and chats. Some large companies like Twitter have made very public statements about going fully remote for every one of their employees. CEOs who were leery of how productive their workforce could be while working remote have been forced to face the facts and see that many people are just as productive, if not more so, when allowed the freedom to work from wherever.
JON: It’s too early to say whether this trend has cemented the fate of our virtual work lives, and in real estate it’s simply impossible to go entirely remote. People are buying property, after all, and a key part of your business is to show that property. All the pieces of the job leading up to that showing, though, may very well be accomplished from the comfort of your couch.
JON: That’s it for this episode of Shop Talk, thanks for listening! If you enjoyed our glimpse of the possible future, please do subscribe to us and leave a review on your podcast player of choice. Shop Talk is a production of The CE Shop.