The real estate industry was moving towards normalizing digitized processes well before the coronavirus pandemic struck. According to a 2019 Profile of Home Buyers and Sellers report, released by the National Association of Realtors, the internet has become the most common resource for buyer hopefuls looking to purchase a home, overtaking the previous norm of finding a home through a realtor or an agent. Breaking down this reality further, 52 percent of recent buyers actually found their home while searching online. That number is up 50 percent from 2018.
COVID-19 and its effect on the real estate industry
In the early days of the pandemic, many of the traditional ways of conducting real estate transactions were deemed non-essential. In an interview with Toronto Storeys, Michael Collins, President of the Toronto Regional Real Estate Board, stated that the TREB implored their 56,000 members to refrain from face-to-face real estate practices.
This regulation had trickled down from the Real Estate Council of Ontario (RECO), amidst other best practices for conducting business during COVID-19. The organization forecasted a variety of digitally-inclined changes to business as usual, including video-conferencing meetings in lieu of face-to-face meetings, virtual home tours and video walk-throughs, electronic document transfers for such things as contracts and property information, and the use of electronic signature tools for finalizing agreements.
Though it’s important to note that the real estate industry was already headed in the direction of digitization, the urgency to adopt digitally enabled services was very much so driven by the onset of the coronavirus pandemic and the closures and regulations it ensued.
The shift towards virtual listings, showings, and staging
Throughout the early stages of the COVID-19 pandemic, open houses were suspended by brokerages across the country. Prevalent realtors’ associations such as RE/MAX Canada and Sotheby’s International Realty Canada were among the brokerages strongly urging realtors to suspend conventional open houses. That said, on the whole, real estate has always been considered an essential service, leaving those immersed in the business to explore safer (and techier) alternatives.
The Toronto Regional Real Estate Board and The Canadian Real Estate Association were amongst a few that introduced live-stream listing tools—compatible with platforms such as Facebook, Zoom, YouTube and Instagram—allowing realtors to conduct virtual showings consistent with health and safety best practices.
There are two types of 3D virtual tours. Interactive or live visits (mentioned above), simulate the experience of traditional open houses. They can be hosted on a range of platforms, including Facebook or Instagram Live, FaceTime, Google Hangouts, Zoom, and Skype. These methods allow for engagement with agents, sellers, and prospective buyers. Alternatively, guided visits work similarly to Street View on Google Maps, in that buyers can view properties digitally and maneuver them freely from various angles. They can be fully virtual or 360-degree videos, captured with a panoramic camera. In an interview with Toronto Storeys, Matt Danison, CEO of Rentals.ca, states that the pandemic has resulted in a huge increase from landlords and property managers from across Canada requesting to use Rentals.ca’s Matterport 3-D virtual tours, which offers users “dollhouse,” floor-plan, and street views.
Physical staging is another facet of traditional real estate that may also be on its way to becoming outdated. This is thanks to virtual staging platforms, such as StageMyHome.ca, offering to create a custom first impression without actually purchasing a stitch of decor.
In addition to lending heightened safety and privacy to the realm of residential real estate, these kinds of virtual developments will allow consumers better chances to find the right spaces for themselves, without having to step foot outside of their homes.
The demand for digital-first amenities
This shift towards digital services has not only affected the real estate industry as far as transactions go. Today, we’re seeing that digitization is also changing what we expect from the up-and-coming properties that are positioned to remedy the GTA’s housing supply shortage.
So, what does this mean for the new supply that’s underway in the GTA and surrounding regions? Though it’s tough to gauge what will stick and what will be subject to further advancement, digital-first products, and experiences, and amenities are well on their way to becoming commonplace. Think: on-demand delivery and concierge services, virtual communities, and contactless access for residents, guests, and maintenance staff.
As more digital-first products, and experiences, and amenities are adopted by those immersed in the real estate industry, there is a stronger and stronger likelihood that digital offerings will become the status quo, creating brand new revenue streams and better meeting the needs of all parties involved.
To end, according to a new poll commissioned by the Ontario Real Estate Association, nearly half of Ontarians who plan to buy a home in the next two years say that they are willing to close on a home they have only viewed virtually. This says a lot about where the industry is headed and how it’s poised to appear in the years to come.