Masterclass: The Future of Real Estate Agents: Navigating New Challenges in 2024 and Beyond

Greg Manship (BeachesMLS), Ryan Maurer (Cutler Real Estate), and Brian Tepfer (Propstream) participated in a panel moderated by Audrey Whittington (SVP Sales & Partnerships, Local Logic) to explore the impact of the recent commission lawsuits, which challenge traditional commission models, and discuss strategies for agents to provide differentiated value in a market flooded with information.

In this Masterclass, you’ll learn more about how to:

• Adapt to the changing dynamics of the real estate industry
• Understand and mitigate the impact of commission lawsuits
• Develop strategies to offer differentiated services to your clients
• Leverage market insights and technological advancements for success

Watch our latest Masterclass on “The Future of Real Estate Agents: Navigating New Challenges in 2024 and Beyond”:

Are changes to the industry beneficial to consumers, agents, brokers, and MLSs?

With consumer trends changing, recent commission lawsuits making headlines, and technology being adopted at a faster rate, there’s no denying that the real estate industry needs to adapt — but is it for the better or for the worse? Many wonder whether these changing dynamics will result in a mass exodus of realtors from the industry. While early signs point to such a trend, much remains to be seen.

Consumer perception of agents and their value has shifted, that’s for sure. Rather than resisting this change, embracing it is an excellent way to gain new perspectives and grow. There is now a unique opportunity for real estate agents and brokers to develop their skills and differentiate themselves to show their value beyond listing properties.

Are all changes good then? Not always. Forced change is not. Occasionally, outside forces will attempt to make judgments about the industry without fully understanding it. A deep knowledge of the industry is essential for driving new initiatives that are in stakeholders’ best interests. Change is beneficial for the real estate industry as long as it can improve the homebuying process in a positive, constructive way.

What does the agent do today that the consumer can’t do on their own?

Providing representation during the transaction

People are capable of doing everything an agent does — though not as well. The consumer can, for example, sell a house themselves if they wish. However, on a national average, the house will sell for $35K less. So, while a consumer could technically do anything an agent does, the question is not if they can, but if they should.

When it comes to homebuying, one of the many ways that agents provide value is through representation. Agents are responsible for the single biggest transaction of most people’s lives. Buying a home is an extremely stressful process, which can be made much easier for consumers when a fiduciary agent represents their interests throughout the entire process. If something goes wrong, the agent is the person that buyers can go to.

Aggregating high-quality data

The agent was the purveyor of information. Now it’s flipped. Today’s consumers have access to all sorts of data online, including a home’s value and details about its neighborhood. But how much of it is reliable? People assume that the data found on portals is updated regularly. However, the data might not be entirely accurate — it tells a story, but it might not be the right one.

That’s where the agent’s role is critical. Not everything on the Internet is true. The agent sifts through all the data that consumers are inundated with to determine which information is accurate and up-to-date. They also make sure that the information answers homebuyers’ questions — whether they’re seeking to understand the factors that determine the value of a home, where to buy, or where schools are located.

Offering local insights

An agent’s local expertise provides tremendous value when it comes to better understanding a particular market. While the media can provide national snapshots, it often leaves out more specific details about an area. Through hyperlocal data, agents can offer consumers a more comprehensive picture of what those markets are really like, adding clarification and context.

Buyer or seller agents: which is more important?

Since the market is driven by listings, traditionally the sell-side held more sway, and buy-side activity has become more lax. However, considering the impact of online inventory and the recent commission lawsuits, the buyer side will have to work harder now to show its value. 

The buyer agent is entirely responsible for the success of the transaction. Every little thing counts when you represent a buyer, from appointments and inspections to escrows and negotiations. Homebuyers will contact their agent for status updates or if something goes wrong. And how the agent handles the situation will determine whether the client stays with the agent. By offering exceptional services, buyer agents are hoping that if a client sells their house, they’ll come back to them. 

Ultimately, it’s a two-sided coin, and both sides matter. Clients who are buyers will eventually sell, and vice versa. So, agents on either side, buy or sell, must put in the work. And good agents are those who adopt a client-for-life attitude by keeping in touch with their clients, long after the transaction is done.

Which tools can agents use to demonstrate their value?

Local expertise in specific areas

Real estate is local. Many homebuyers who move across state lines don’t know where the best streets or schools are located in their new neighborhood. Even if they’re moving within the same area, local knowledge is very valuable. Roads are different from each other — just driving down the street won’t tell you if it’s quiet, for example. While homebuyers could do their research, agents possess in-depth knowledge of an area that online statistics cannot adequately convey.

The comprehensive tool stack offered by the MLS

A MLS’s primary responsibility is to provide great tools to brokers and agents and help them be more efficient. Yet, there is a huge usage gap with many MLS tools being underutilized. An agent should review their tech stack to identify which resources are already offered through their MLS and what they really need. Some agents have even invested in MLS tools they received for free, paying double for the same service.

Despite the fantastic integrations, automation, and advancements created by AI, the best tools remain the ones that are actually being used. Agents need to keep up with technology, but it can be overwhelming — so it’s the MLSs, brokerages, and technology vendors’ responsibility to make sure the tools they provide are accessible to agents.

How does the lack of inventory affect models and the role of agents?

Leveraging tools to search for low-inventory leads

What are the best ways to aggregate data from multiple sources to find low-inventory leads? How can agents look for leads that will become qualified listings and identify mortgage issues, closure risks, or family changes that may encourage people to sell?

Models come and go, depending on consumer demand. It doesn’t matter which model the agent is operating under — whether it’s flat fee, concierge, or full service. To overcome inventory challenges in 2024, data analytics, tools, and statistics will be crucial. There are still houses out there that need to be listed, and agents need to leverage the right tools to find them.

Bolstering the importance of personal branding

Branding is an important part of generating leads for agents. A solid starting point is for agents to set up their profiles on portals and keep them up-to-date. They also need to ensure that leads are sent to the right place, so they can reach out to and follow up with them to keep them engaged.

As the real estate industry shifts from a transactional to a relationship business, agents need to build relationships with their clients to stay top of mind with clients. Meanwhile, they also need to free up time to work on their business. Realtors are not able to do everything and that’s ok — that’s why tech and tools exist. 

Are digital businesses replacing traditional relationship businesses?

In the same way that the younger generation of buyers prefers to do their research online and save money, the new wave of agents is more likely to use tech tools than more established agents.

With efficiency in mind, customers won’t hesitate to move on if something doesn’t get done fast enough. So, maintaining a successful relationship requires agents to use the tools at their disposal to keep their clients as informed as possible during the transaction, while staying two steps ahead of them, going as far as setting up their utilities for them. That’s what builds loyalty. That’s what sets up future transactions.

Can more be done with tech? Yes, but automation is not a substitute for human interaction. According to NAR, 90% of buyers were happy with their agents, seeing them as a useful source of information in 2023. Purchasing a home is the largest purchase a person is going to make in their lifetime. It’s too big a transaction where too many things can go wrong to ignore relationships completely. While online research is helpful, it will never fully replace an agent.