[00:00:00] Zach Hammer: Welcome to the Real Estate Growth Hackers Show. I’m Zach Hammer here with my buddy Charlie Madison, again. We’re coming to talk to you about AI today, we got

[00:00:10] a pressing question here that’s on everybody’s minds and it’s, will a bot take my job? And what is the future of AI in real estate?

[00:00:20] That’s what we’re talking about today. What do you think about that topic, Charlie? It’s pretty interesting, exciting topic?

[00:00:24] Charlie Madison: I like it. I’ve got a lot of thoughts on it. My stepsister just got her license. That’s a question that she’s got that’s a question that a lot of people have.

[00:00:33] What is real? What is not real? Where will it help? Where will it hinder?

[00:00:37] Zach Hammer: Right. Yep. And so yeah, that’s what we’re gonna dive into. Let’s get right into it. First off on this episode we’re gonna cover a pretty wide swath of this question we’re gonna talk about for lack of a better term, the good, bad, the ugly as well as breaking down where AI is making an impact, where it maybe isn’t making an impact.

[00:00:56] What elements of the real estate profession are safe, what [00:01:00] elements are at risk or need of being adapted to, and really what would have to happen for this to be an existential crisis for real estate agents. And yeah. So that’s what we’re gonna dive into. Before we actually started recording, Charlie, you had mentioned five things that require skill.

[00:01:16] In the real estate world that essentially make or break a good agent. And before you get into those the reason why we’re starting here is the simple answer to this question. I’ll just close this loop right away.

[00:01:27] It is my belief that real estate agents are not going away, that there is too much emotion, too much humanity that’s involved in a real estate transaction that real estate agents are definitely needed still in that process, Isn’t taking that away. There are things that AI is disrupting. There are aspects of the real estate profession that I think are changing, do need to change much of it for the better of consumers, especially the home buying and selling process.

[00:01:52] There’s a lot of things that this improves but it doesn’t get rid of the need of the real estate agent.

[00:01:57] Now, keep in mind the average [00:02:00] consumer may not understand the real estate transaction well enough to think about this the same way that you and I do here. So in their mind, they may be thinking that they don’t need a real estate agent because of some of these tools.

[00:02:10] And so there might be a little bit of extra work and marketing and communication that’s needed to really show where a real estate agent fits in this AI driven world right now. But, at the crux of it, when we look at that reality of, do people still need the real estate agent, the real estate professional to help them successfully navigate that process of buying and selling a home? Simple answer to me is definitely yes.

[00:02:35] So let’s dive into some of why we think that, and that’s what we’ll get into these five things. Charlie, go ahead and and walk us through those five things. Let’s start with the first one and let’s riff on that a little bit.

[00:02:46] Charlie Madison: Yeah, I found there’s five things that separate a successful real estate agent from an unsuccessful one. Everything else is eye candy and these are hard things that AI’s to be [00:03:00] really hard to replace.

[00:03:01] So the first one is converting a contact to an appointment.

[00:03:08] Zach Hammer: Right. Yeah, that, that makes sense. That’s the whole process of you’ve got somebody in your database, somebody that you could talk to a name, an email, a phone number maybe a social contact, however you are going out into the world and getting people to actually, come and talk to you.

[00:03:23] But, doing that is a pretty hard process. I am seeing that there is some traction in the vein of AI possibly being able to replicate some of this pretty effectively, pretty quickly. If only because a lot of the reasons why people are looking to buy or sell start to become pretty consistent.

[00:03:40] And the reality is we know if you could follow a script and get a result, then AI could probably follow that script as well, if it’s adaptable enough. So we are starting to see there are some tools coming out that are making a difference on this, but out of the list of difficulty.

[00:03:56] This is definitely still one of the higher ones of, it’s gonna be hard for AI [00:04:00] to replace this. I do think we will likely see a scenario where a lot of the work of lead follow-up can actually be put on AI, but hey honestly, that just ends up being better for the real estate agent, if that makes sense.

[00:04:11] So it makes your life easier rather than making you not be needed. Okay. So that’s our first one, getting the lead to meet with you. What’s this? Go ahead.

[00:04:17] Charlie Madison: And I would say I think that’s the one that’s the easiest for AI to duplicate. And I think also a lot of times that’s where AI working with media and letting me taking one video and splitting it into 12, like the truth is a lot times my clients, they already know me and so they’re going to come to me. In a lot of ways they already know they wanna hire me before they wanna reach out to me.

[00:04:43] So I think that’s probably easiest one that the technical part AI can replace. But the part of having client view you, trust you, that’s gonna be the hardest part that AI can not replace.

[00:04:59] Zach Hammer: [00:05:00] And this fits into a vein of kind of how I talk about AI as well, which is whatever you are, AI is really good at amplifying it. It’s not really great at like fixing all of your, If you don’t have a point of view, if you don’t have a unique reason why somebody should hire you, having AI doesn’t fix that.

[00:05:22] But if you do, if you have great ways to help people, you could show that you’ve got a track record, you’ve got reasons that makes sense for people to help you or for people to hire you because you could help them. Then AI could actually can help shine a light on that could help guide people through a process conveying that information to that like that, that is starting to improve.

[00:05:40] But if you’re coming in and you don’t have a unique point of view, you can’t just click a button and have AI start fixing all of that for you. If the reality is everybody has access to AI. So if it was as easy as just pressing a button and it does it for you, that means everybody else has the same thing, which means it’s not going to be effective if [00:06:00] everybody is using the same exact thing, it stops being a way to stand out.

[00:06:02] So having that unique point of view, using your human creativity is still a big part of that, but the legwork to leverage the creativity is being made easier by AI, for sure. For sure. So what’s the what’s the second aspect that’s core to being a successful real estate professional?

[00:06:18] Charlie Madison: Yeah, so step one is converting a contact to an appointment. Step two is converting the appointment to a client.

[00:06:25] So, getting the person to hire you. And I think it’s with the caveat, like, I know of one agent, he says, we’ve got a, like 95% success rate with new agents converting leads to clients. And the reason is they charge $700 for a listing.

[00:06:43] So, do it for free, if you’re a flat listing, if you know the it’s easy for AI to do that as well, but if you want to, make a career out of this, if you wanna charge enough to make a living, then it [00:07:00] takes real sales skills to convert that appointment into a client.

[00:07:06] Zach Hammer: And ultimately people end up getting some level of experience through the market. I don’t even know how to describe this, exactly. But the reality is low grade services, flat fee services were not done right, not done correctly.

[00:07:18] You end up in a category of either somebody has figured out the right technological mix to be able to do a great service at a low cost, and in which case they should totally win. They should totally be able to win off of that and likely will. Or what we tend to find is that most people lean on price when they don’t have skill to offer and when you’re, it doesn’t matter what you’re paying, if you’re paying little for a bad product or a lot for a bad product, it’s a bad experience regardless.

[00:07:47] And ultimately people start to discover when you hire somebody who doesn’t actually charge what they need to in order to make that process work well, they end up seeking the ones that can’t. And you typically, you everybody [00:08:00] knows the phrase, you get what you pay for that people either learn that by working with good people on the front end, or they learn that through experience working with poor performers.

[00:08:09] And what we’re gonna see is as we go through this, a lot of the process that comes after you get the client is the real part that’s hard. And AI might be able to help with a lot of the lead up. A lot of the helping, you talk to people, get them to book appointments, might even be able to make it so that most of the work is done by the time they meet with you.

[00:08:29] I don’t think we’re yet to the point where you could have somebody who is actively working with you, leveraging exclusively AI. Chances are something right now, person to person, they’re going to want to talk to another person. They might be mostly sold by the time they get to you, but you’re still gonna have to be there.

[00:08:44] They want to experience a human being before they make an agreement, sign up and become a client. So, there is some human element that’s gonna be necessary there for sure. Possibly AI can do a lot of the leg work leading up to it. But okay.

[00:08:57] So, we got somebody hired. What’s the next place where the [00:09:00] real estate agent really has to develop a skillset in order to be successful?

[00:09:04] Charlie Madison: So the third step is if you’re working with a buyer, that they’re willing to write an offer that will get accepted if you’re working with the seller, that they’re willing to list their house at a price that is in the market or that they will accept. They’ll accept an offer that’s in the market rate, ’cause every buyer wants to pay less, every seller wants more. And it takes leadership, it takes knowing the local market, like sometimes just one street over can affect a 25, $50,000 difference or more.

[00:09:42] And there’s a lot of emotion, a lot of coaching, a lot of leadership that I’ve found to be able to get someone to actually get the house under contract, whether they’re a buyer or a seller.

[00:09:55] Zach Hammer: Right. Yeah. And this, honestly, this is our first one where there’s [00:10:00] arguments that could be made on the first two, and g etting the lead to meet with you, getting the lead to hire you where you can make a solid argument that AI can start taking care of a lot of the heavy lifting there.

[00:10:08] And that you don’t necessarily need a ton of skill in order to actually get somebody to work with you. Again, right now we’re not quite there. AI hasn’t made this super easy yet, but on the near horizon, we’re seeing that being possible, like, I could envision that.

[00:10:20] This is one of those areas where we really hit the key point of contention where the emotion, and our current what’s the word for this framework point of view. Paradigm’s the word I’m looking for.

[00:10:34] Our current paradigm of how we think about these types of transactions. I don’t think the average person is ready to accept an AI doing this job yet. Where giving good, solid recommendations of pricing giving good, solid recommendations of where to list that, how to list, how to price, all of that. Like being able to go through the process of getting somebody to be on the same page. And like you said, that [00:11:00] leadership that’s required, that’s more than just an AI process.

[00:11:03] And even if it wasn’t, even if you could download the best leadership and the best knowledge, and you put that into an AI. I really have a hard time believing that a person knowingly interacting with an AI or knowingly interacting with software is going to consistently trust that and move forward. ’cause that’s what it takes, right? It takes, the person that you’re working with, the seller, the buyer, they’re in control, they get to decide to move forward or to stop, et cetera at any, provide resistance any step of the way.

[00:11:32] And if they’re not bought in , It ceases, it stops, it stops moving forward, it stops progressing, and that causes the real estate transaction to not progress as well. And so it really is at these points of both writing an offer, how to write the offer what homes to write the offer on, all of that. And then on the other end listing your home at a price that makes sense for your house.

[00:11:56] What offers to consider, what offers to accept. Like all of that becomes a really [00:12:00] emotional thing. That without, right now, human guidance and a solid real estate professional there to serve in leadership to that clients and to that transaction, that it falls apart right there.

[00:12:12] Charlie Madison: And even.

[00:12:13] Zach Hammer: And so, that’s, go ahead.

[00:12:15] Charlie Madison: I’ve even found like, when my clients listen to my guidance on what they need to do to stage their home. Like, a of times they don’t even have to spend money. Maybe they spend a grand, most of the time, but the way to make things look. What to do, what not to do, I’ve seen my clients that do those things, like they usually get about 10% more.

[00:12:39] At least here in Nashville. That’s what I found. And it takes leadership to, just coach ’em and encourage ’em, it’s a lot of work, to get the house stage ready and set expectations and just that right there is a lot.

[00:12:53] Zach Hammer: Yeah, absolutely. And so we get through that process, right? Like we figure out working with [00:13:00] sellers they’re listening to coaching on staging. They’re listening to coaching on pricing. They’re listening to coaching on timing of when to enter the market, what that marketing strategy looks like, all of that, right?

[00:13:08] All of that is leadership. That could be aided with AI potentially, but still takes I think, a human to deliver it, convey it and work with a person. Similarly, the buyers what homes to look at, what homes to consider, what homes to make offers on how to make those offers, how to be successful with those offers.

[00:13:25] All of that. Again, AI, I might be able to help with some level of it to make that process easier. But still you want that human to be conveying that and working with you through that in order for somebody to be bought in to move forward through the process. So now we get to the next part of the part.

[00:13:39] Go ahead and take us through step four. What’s step four where really requires skill as a real estate professional?

[00:13:45] Charlie Madison: Yeah, once you’re under contract, then it’s removing contingencies and that can be, the three main ones are one, the financing contingency and the lender has a lot more to do with that. And there’s some ways where, AI, [00:14:00] blockchain will make that easier. But there’s a lot of it too, where I tell my clients the underwriter always wants more paperwork. When you think the lender cannot ask for any more paperwork. They’re gonna ask you for more paperwork, and it’s frustrating, it’s exhausting.

[00:14:17] And so just setting that expectation, getting them through there, hitting the right timelines, that’s one contingency.

[00:14:26] The second one, which is a big one, is the inspection contingency. Most of my clients, they get a home inspection. The list comes back with this long, crazy list. What is important, what’s not on both sides, the buyers and the sellers, and this is where emotions can really get into play. And you’ve gotta be able to, from what I’ve found, you’ve gotta have a good trusted team on what’s important, what’s not.

[00:14:54] One of my favorite stories was I had a client, that was buying this beautiful house[00:15:00] here in Mount Juliet, and the inspector said the window’s broke. It won’t open. You need to replace it. And it was this giant window and my contractor was there he looked out and there was a nail in it. He pulled out the nail, the window worked just fine. Now, a lot of times, the home inspector, they find stuff with the HVAC, the roof, like, they find lots of stuff. And so to be able to get the emotional buyer, the emotional seller, to be able to meet at a place within the right timeframe.

[00:15:34] Because there’s some stuff that you literally won’t be able to see when you first walk through the house. That’s the purpose of the inspection. And then there’s a lot of stuff that, I’ve got one right now, there’s plumbing issues that we didn’t know about, and we got money to get it fixed afterwards.

[00:15:49] So the second one is the inspection and then, the third contingency, the big one is the appraisal. What happens if the home comes under [00:16:00] appraisal? Does the buyer have the money to bring the difference? Do you actually contest the appraisal and try to get the appraiser to change the value? That doesn’t work a lot, but it does sometimes it makes it closer.

[00:16:12] Do you get the seller to just drop the price? I’ve done that. So all of that, like that’s, and that’s not negotiating. That starts then that’s really negotiating that started when you first get under contract, like building that rapport.

[00:16:28] If I’ve got a client that can’t bring any additional money. Like, I put that on the contract. Hey we’re getting a 95% loan. All of that stuff helps. What I’ve found is inexperienced or unsuccessful agents fail three outta four times on those three things. Those are big things. A lot of emotion. You’re dealing with all three of them a lot of times at the same time. And so I think that’s going to be very hard for AI to solve with all of the emotions [00:17:00] in this tight timeframe right there.

[00:17:02] Zach Hammer: Right. Yeah, absolutely. I mean that that’s the key. Is there potentially an argument to be made that that AI could could help somebody navigate that could help somebody maybe step out of their emotional frame and step into the logical solutions oriented and get ideas and be assisted.

[00:17:19] Absolutely. I think that’s one of the areas that AI is really good and really powerful on, is being able being able to think in a way that we struggle to think through something given our current frame mind. For instance, if I am pissed off, it’s gonna be really hard for me to write a friendly email.

[00:17:37] But I could put together the basics of my thoughts and have AI write an email that actually comes across the way that I need to professional et cetera. So I could move forward and leverage AI to gain power in that, but I still have to know what I’m doing. And then further, the only reason that is actually accepted either by the other agent that you’re talking to, by your client, by their client, et cetera, is because again, [00:18:00] they are perceiving it as coming from an empathetic human who is, like, they understand how that works, right?

[00:18:07] Right now, we don’t have any level of AI that we believe is empathetic, that we believe actually cares about our goals, our needs, et cetera. If that comes along, if that develops and people believe that and trust that, that starts to have more power.

[00:18:19] But right now, we’re not there. It’s not on the near horizon. What we see right now is more akin to regurgitating patterns that we see similarly. And so it’s useful as a tool, but it’s definitely not the same as like sentience and empathy and those kinds of things. So yeah. Absolutely. Absolutely.

[00:18:35] And so then , I love the way that you word this last one. ’cause really it’s a combination of all sorts of the other ones, right? But it’s a very clear, specific time where this happens. Talk me through the fifth thing that a real estate professional needs to navigate in order to be successful?

[00:18:51] Charlie Madison: We call it the last three days. We call it the green zone. And I’ve gotten to now where I actually tell my clients upfront, I say, [00:19:00] now, you’re probably not gonna remember this, but when we get through this transaction, the last three days, something’s gonna come up.

[00:19:07] That’s crazy. And it’s gonna seem like something insurmountable that there’s no way that we’re gonna be able to get through it. I just want you to know. That’s why we get paid. ’cause we always solve it. And the truth is, and it doesn’t always have to be the last three days I’ve had, sometimes it happens 10 days out, 12 days out.

[00:19:26] When that happens, I just tell the clients like, Hey, this is really great news. We usually have 72 hours to solve this. We’ve got two weeks. This is amazing. And but something, just something off the wall, my title girl, she’s been in the business 30 years, probably two outta three times, whatever it is she has never seen before. Think about that. She’s done, without a doubt, tens of thousands of deals. Like she does 10 to 40 a month for 30 years.[00:20:00] That’s a lot of deals.

[00:20:01] Zach Hammer: Right.

[00:20:02] Charlie Madison: And 66% of the time, she’s I’ve never seen this before, Charlie. you don’t know what it is. And you’ve got the buyer agent, the listing agent, you got the title companies you’ve got the emotional buyers, you’ve got the emotional sellers. If it’s a first time home buyer, it might be the buyer’s parents involved.

[00:20:24] You’ve got all of this, and then if you’ve I had one a few years ago. I had a client was buying a house and the people that he was buying the house from, they were buying a house in North Carolina. In North Carolina at a certain day, your earnest money is non-refundable, was a lot of money.

[00:20:43] And we had a, within those last three days. And the buyer of my client’s house, ’cause they were selling theirs, was an agent. And 72 hours before the agent’s, Hey, we need to extend, ask how long. He said, I’m not [00:21:00] sure. So I had to get on, and it was a lot. And so I had to get on the phone with the agents in North Carolina and say, all right, here’s what happened. Here’s what we’re doing. You should stick with this deal because yes, your money’s going to be non-refundable, but we are going to close this and here’s why. And if they would’ve backed out my client, like the whole deal would, would’ve all fallen through if I couldn’t have convinced them. And that’s a normal three day thing. So that’s gonna be really hard for AI to solve.

[00:21:39] Zach Hammer: Absolutely. Absolutely. Yeah. And I love that. I mean that like our last three points on this, they all go to illustrate. Like the thing that technology seems to be moving toward trying to solve is mostly the easiest part, which is finding the home and getting people into houses to see them.

[00:21:57] It’s yeah. All right, great. You’re doing a great job solving [00:22:00] what is earliest in the process, and it’s the least difficult part of the process. Awesome. Like it’s good that we’re trying to solve that, but it doesn’t do much for it, but really the hard work of real estate and why real estate agents do deserve to get paid for the skill that they bring to the table is everything that happens once you’re actually working with somebody.

[00:22:16] The emotion, the chaos, and yeah, that’s not going away anytime soon as far as I could see. And those are the key reasons to me, definitely. Why a robot isn’t about to take your job. I don’t see that as being on the immediate horizon. Again, like we said, there are definitely some elements where AI or software where technology is disrupting the field and definitely making you have to adapt to stay competitive in the current landscape.

[00:22:40] And so don’t take this as a saying. You don’t have to change anything ’cause you do . There’s a lot of impact that’s happening from AI, but the core fundamentals of helping keep a transaction together, of helping connect people to the thing that they want and really helping most people to be able to get past, to get through the emotions that would prevent [00:23:00] them from being able to do it.

[00:23:01] That’s the key value of real estate agent. It’s a, 99% therapist and 1% actually dealing with real estate itself, right? Both for yourself and for your client.

[00:23:11] Charlie Madison: Yeah.

[00:23:12] Zach Hammer: But yeah. So let’s talk about, there are some things. So let’s move into the next phase of this. There are some things that would, I think allow AI to replace a real estate agent. So if we see these things shift in the market dynamic then yes it does become possible. And these aren’t impossible things. Like, these are somewhat possible things. They aren’t things that I see happening on the horizon.

[00:23:35] There isn’t a clear, Hey, technology is heading this way. This is definitely happening. These are more like, if things shifted enough in a way that is unexpected and these things happen, then sure. AI could start to, replace the real estate agent in a transaction.

[00:23:49] And the first one that comes to mind, A lot of the motion of a real estate transaction really is beholden to the size of a transaction that it’s if it was a smaller transaction, people would not be nearly [00:24:00] as emotional, and so it wouldn’t be as hard to navigate. If you’re buying a used product and it’s got a slight dinging to it.

[00:24:07] That doesn’t typically make the difference between you buying it or not if the price point is below a certain point, right? That’s something that people are often able to comfortably deal with and expect when you’re buying a used product. But man, when that thing is, that like hundreds of thousands, millions of dollars those minor inconveniences add up to potentially being major cost inconveniences as well as experiential inconveniences.

[00:24:32] And so, it goes back to money. Now if for some reason real estate became a cheap transaction, if it was. The equivalent of a sub hundred dollars transaction for most people then man, there’s a lot less emotion involved, right? So if it becomes either through manufacturing supply shoot if there shoot in terms of overall scenarios and dealing with supply and demand if something happened that wiped out 90% of the population overnight, Then maybe real [00:25:00] estate becomes a lot easier to do because there’s drastically more inventory than there is people able to buy it, right?

[00:25:05] So unless somebody’s aware of some sort of really crazy scenario on the horizon I don’t see that happening anytime soon, or at least not in a predictable way. And so as it stands right now Market prices might fluctuate and there might be some level of increase in prices, decrease in prices, markets are gonna market.

[00:25:21] But I don’t see housing going to that level where, shoot I don’t even see it going into the level where it’s like automobile pricing, like cars I don’t even see it going that low.

[00:25:34] Charlie Madison: 50,000. Yeah. That would still,

[00:25:36] Zach Hammer: Right.

[00:25:37] Charlie Madison: You don’t have all the people involved for that. That’s usually, you go to one dealer. Yeah.

[00:25:42] Zach Hammer: Exactly

[00:25:45] Charlie Madison: Yeah, I would think even if there is a place where they find, ’cause they do have 3D printed homes, they’ve got technology’s amazing. I love that.

[00:25:54] Zach Hammer: Right.

[00:25:55] Charlie Madison: If people can, there’s gonna be people that want custom homes still,[00:26:00] that’s normal.

[00:26:03] Zach Hammer: And even still, then you just find the other bottleneck, which is land. And typically the desirable places also have a limit on land available. So, even if the house of the price of the house becomes cheap, the house of the land just comparatively goes up in value and you end up paying for the spot rather than paying for the home.

[00:26:20] And, Still, you’re still gonna have it be a fairly scarce, fairly scarce resource compared to a higher percentage demand. And the price is gonna stay stay high. ’cause it is, at least at this point, basically impossible to just manufacture in mass new great places to live.

[00:26:38] Maybe the buildings become easy, but you can’t sh shoot, I live full time in an RV traveling the country with my family. Even just the experience of being in Nashville versus Dallas versus Austin, versus Southern California versus the Pacific Northwest.

[00:26:57] The National Parks area of California, the [00:27:00] deserts, like all of these places are really unique in their own ways. And even if they wanted to rubber stamp one of the other locations there’s a certain organic growth that comes to create, like the spirit and feeling of an area.

[00:27:13] And that uniqueness is gonna have its own demand as well and be impossible to just replicate with technology. And so, I think, it is incredibly likely that real estate stays as a high value price point, which to me necessitates that a human is involved in that transaction for a long period of time.

[00:27:32] There is one other thing that could potentially decrease the need for humans, even in that world, even acknowledging that the price point stays high. And really it’s combination of two things. One, human confidence in allowing AI and robots to guide and dictate decisions needs to become the norm if that was going to happen.

[00:27:51] The average person, when you ask ’em on the street, whose opinion would you trust more in regards to this human that you trust or this AI you [00:28:00] giving you results from an algorithm? We would need to move to a point where people literally don’t have resistance to that. Where they feel like I would either, just as readily or more so trust the AI opinion than I would, the human.

[00:28:13] And I think there are things that we are moving toward AI being able to give that sort of recommendations and guidance too. Things that, for better or worse tend to be a fairly, just a process driven, you’re following it. It’s, more practical than it is systematic.

[00:28:29] Honestly, that’s happening with with doctors. I think we’re seeing AI very readily impacting transportation because when we’re driving, we’re not making. The goal is to reduce the emotional decisions that are being made, right? We’re trying to make that process as unemotional and repetitive as possible.

[00:28:47] And hopefully removing the emotion out of it and the human inadequacies out of it. Similarly when it comes to when it comes to doctors and medical most of the time what’s happening is it’s input of data and an output of here’s the flow chart process.

[00:28:59] [00:29:00] Here’s the way to interpret this data. And, it’s very possible that we’re gonna see some of that start to shift to change. But even still, I think it’s gonna be a while before somebody fully accepts like an AI driven diagnosis compared to a human giving it kinda that final step of saying, yeah, in all my years, all my research, the arguments that I’m seeing here, I agree with this, let’s move forward.

[00:29:18] And those are things that are fairly logical and repetitive. We’re dealing with real estate transactions. Let’s be honest. Most of the reason for the decisions that people are making is, it’s emotional , right? It’s we’re talking about a collection of wood minerals and polymers, coming together, right? Like you can get your collection of wood, mineral and polymers all over the place. The reason why this has significance and value to you is really all a matter of the subjective, right.

[00:29:49] Charlie Madison: So unique, right. Each plot of land is unique, even if it’s a cookie cutter house, the truth is each connection of polymers are unique. ’cause you’ve got [00:30:00] subcontractors, but then you know, you’ve gotta think what else is unique?

[00:30:03] The other people that you’re connected with in life, you want to be at a certain location ’cause you want to, drive 15 minutes to the grandparents you wanna drive 10 minutes to work and you want to drive 25 minutes to the volleyball field or pickleball.

[00:30:17] Zach Hammer: Right

[00:30:18] Charlie Madison: And there’s just so much. And every part of it is unique to each individual. And then, every house is unique, every land is unique. So you know, it’s not something that AI can really just have one playbook and run.

[00:30:36] Zach Hammer: Right. Exactly. Exactly. And so that’s really the key. The thing that potentially gets AI to the point where it could step in and be able to run that process well is, it is sentients, right? Like AI gets to the point of actually being able to exist, have its own framework, its own emotions.

[00:30:55] If we could believe that AI is 100% and truly acting in our best will, [00:31:00] and we believe that it has the capability to do by fully understanding our lived experience, by being able to understand the circumstances, and sure, you might be able to get somebody to trust the transaction, but I’m telling you where we are in current technology, we aren’t looking at Sentients right now.

[00:31:14] We’re looking at, really, we don’t we might be looking at Sentients. We don’t know. We don’t know exactly what Sentients is. So, it’s possible, but we’re not looking at a scenario where we’re thinking, yeah, give it five years and we got AI’s that are essentially their own people.

[00:31:28] We’re not looking at the landscape that way. We’re looking at we see that a lot of what we thought is really complex intelligence maybe was us running a kind of frameworks consistently that AI is actually able to do pretty well. But that Sentients aspect, that emotion, that like true ability to have empathy and know that you’re talking to another person that has a lived experience that’s even somewhat related to you that, that thing I is still part of what makes a real estate transaction [00:32:00] successful and therefore when somebody is looking for who they’re gonna work with for that it’s an important element. And we don’t have that in AI and we’re not seeing that come anytime soon. It is possible. ’cause again, we don’t completely understand it.

[00:32:10] And who knows if it happens, but I don’t see it on the near horizon. And further not only does that impact real estate, that impact, impacts everything.

[00:32:21] Charlie Madison: At that point it becomes your subconscious almost.

[00:32:24] Zach Hammer: Yeah. We get sentient AI. We’re not looking at professions even in the same way anymore. We’re yeah, like, that’s an ontological change in in humanity. That’s a big one. Anyway. So, those are the things that I think really keep the real estate professionals solidly having a true place of value in the real estate transaction.

[00:32:43] And what would have to happen for that to change, which hopefully you could see is not, greatly likely. So the final thing that I wanna explore before we end this episode, is just some of the ideas of what AI is able to replace, what aspects are impacting the industry, what things should [00:33:00] we be aware of and at least either deploy for ourselves, know that they might be shifting our workflows that sort of thing.

[00:33:07] And really anything that is just a matter of data, just a matter of processing that data and following a process. Those aspects can likely either be replaced by AI or leveraged by AI, right? So improved automated maybe the human has a final pass, but but where AI could be deployed, so things like home search, right?

[00:33:28] I expect that there will be tools coming along where people aren’t typing in, I want this many beds, this many baths. Like where it’s input like that, it’s, and it likely starts to become more of a conversational, more of a the way that a human would be able to connect somebody to properties is likely AI can start to do that as well pretty soon, I’d say.

[00:33:48] So I’d be looking at technology that’s moving that way that I think can be powerful. I think the scale of follow up, the scale of marketing those things can start to be being leveraged by AI. If you’re not deploying technology [00:34:00] in that, in those veins it’s less that AI is gonna replace you and a lot more likely that other humans leveraging AI will be the ones to replace you. So those are the things that you should be looking at for sure. And so all of those aspects.

[00:34:14] Go

[00:34:14] Charlie Madison: The one that excites me is personalized content. You’ve got the ability where you can just change someone’s name by typing it, it’s partly automated, partly personal, it’s you, but modify it a little bit.

[00:34:31] And then I think the biggest what I am excited about is we can create content like this and then we can use AI to create little edit clips. So we can, because people want to consume, 2, 3, 4 minute clips. They’ve got more time to do that. And so this lets us basically create little commercials through AI that lead to the longer thing.

[00:34:56] So I think it’s to basically exponentially[00:35:00] increase you do one thing and now it’s 12, 13, 14 things that you could hire an editor, but it’s much more scalable now.

[00:35:12] Zach Hammer: Yeah. And I think there are things that will especially on the customization, I think we will enter some changes in terms of what people expect. I think if somebody feels like you were trying to come across as reaching out to them personally, but weren’t actually doing that’s gonna have big trust ramifications moving forward. So I think we gotta be careful how we navigate that.

[00:35:37] But I think, there’s an interesting thing. One of the tools that I use, it’s called a recast, what’s it called? Recast. It’s about .FM.AI? I forget anyway. But what it does is it allows you to take written articles online.

[00:35:50] You click recast and it gives it back to you as if it’s a podcast, but specifically not just audio, it gives it back to you as if it’s like a conversation between two people.[00:36:00] So, it changes the flow of the content where you’re still getting all the content but it’s given to you in a podcast sort of style.

[00:36:08] And what’s interesting is all things being equal I prefer that way of consuming content. ’cause for whatever reason, it does connect in a way that I enjoy consuming more than just like listening to a summary or or even just having the audio version of something, and so I think that there’s something at play in the future where I think this kind of interesting element of something being customized to a person, but they’re in on it and they understand like the customization is less about trying to appear like it was done for you personally, and more about just making that a better experience for that one to many marketing.

[00:36:46] If that makes sense. I think we’ll start to, hopefully the same way, like I go into a video game and I play the game. I don’t expect that that the game designers literally develop the whole game just for me, specifically I expect that there’s some level of [00:37:00] interaction with the game that’s unique to me, but still, Top down, inspired by the game designers and their creativity. So like it’ll replace the character name with my character name and those kinds of things, right? I think in the same way maybe as this technology becomes more pervasive, people will start to expect like, Why does this email say, Hey there, it should say, hi Zach, and it should mention that it’s Thursday and give me the weather and whatnot.

[00:37:24] I’m just gonna start to expect that, ’cause everything else will feel weird, if that makes sense. So yeah, so I think those kinds of elements are at play for sure. You mentioned one that I hadn’t talked about or I hadn’t thought about until you had mentioned when we were talking earlier.

[00:37:36] Yeah we’re really big right now on AI when it comes to l large language models, image generation, those kinds of things. But one of the other places where AI is being making major strides is, the AI that’s being used to automate cars driving and the technology.

[00:37:50] So in the real estate space, definitely there’s some good potential ramifications around making a real estate agent’s job easier. You wanna elaborate on that?

[00:37:58] Charlie Madison: Yeah. I think [00:38:00] Driving around looking at homes is probably one of the least valuable parts from my perspective. Like right now, it has to happen, One way that AI can help is, you walk through a house and you record it, and like you’re using while you’re using technology and they get to walk through the house that way, or you have someone else to do that. Or, another option is, which, like in Tennessee we can’t do this yet because of the way the rules and the combination locks work and everything.

[00:38:31] But I could see if you have self-driving cars, I could very easily have a self-driving car. Pick up my clients, take ’em to the houses, open door offer pad. They let people go into the houses by themselves now. We are getting there.

[00:38:51] But you know that could change the game because that’s one of the biggest. I think that’s one of the reasons a lot of successful agents aren’t buyers agents [00:39:00] is because driving is the biggest bottleneck.

[00:39:03] So I think, you’ve got a great opportunity there to, keep your skills, but not use that time suck. And, how great would it be for buyers, they just pull up the phone, they wanna see these three homes today, and they’re just taken to it.

[00:39:23] Zach Hammer: Yeah. It’s instead of the book a showing being just a digital thing, it’s book a showing is like, when will the car pick you up? And how, this is approximately how long your showing session will take. And this is, when it’ll be over like all of that, where it’s like literally you could see the time commitment.

[00:39:41] You could get a feel for that. Yeah. I think there’s a lot of power that could come from that really, it makes the experience better for everyone. The more that we can leverage technology to replace the aspects where humans aren’t needed. That that’s a good thing.

[00:39:52] Let’s keep the humans doing the creative human side where we need humans, where we need the things that are uniquely human, are uniquely us to [00:40:00] be present in that process. And chu let’s let technology and AI do the rest. That sounds great. And then one of the other things that we talked about, two I see AI and technology in general.

[00:40:10] So this is a little bit bigger than just AI. Potentially making some of this process of contingencies, finance, title search, some of that a little bit easier by having more of these things that are uncovered through the title search through through those sorts of things that, that it really.

[00:40:25] Some of the problems that come into play are, it’s a holdover from a paper era . And as that stuff starts to get digitized and we start to maybe move into things powered by like blockchain and some of these better technologies that we’re seeing where essentially homes are maybe NFTs instead of or like the ownership of a home is an N F T rather than being a record that kinda has to be digitized and figured out in, closed databases and stuff like that.

[00:40:50] Anyway as those things start to become more available, things like AI are gonna be able to leverage that better to detect issues, detect things [00:41:00] clearer, et cetera. I think we’re still probably a far way off on that, that’ll be a long-term undertaking of moving that direction.

[00:41:06] But but yeah, those are things that are definitely, what I’m looking at, like where can technology impact this? What are some of the things. That either improve or shift the real estate game. Those are some of the big areas that I look at for sure. But but yeah.

[00:41:17] Any any other places where you see AI impacting the game or replacing things?

[00:41:23] Charlie Madison: I think those are the main ones. Possibly with paperwork, like we’ve got transaction coordinators now and a lot of the paperwork we have to deal with is because people want someone to take responsibility, and then lot of the paperwork is, covering your butt.

[00:41:40] I’m a realtor, but I’m not a roofer, all of that stuff. I could see the efficiency with the paperwork being a place where it’s going to have help sooner rather than later.

[00:41:51] Zach Hammer: Yeah, that makes sense. That makes sense for sure. So I mean, that’s the key to me. So the short idea in all of this the T L D R is a robot about to take your [00:42:00] job if you’re a real estate professional?

[00:42:02] Charlie Madison: No, I don’t think so.

[00:42:03] Zach Hammer: Is a robot hopefully gonna make your life easier, help do some of the stuff that was not necessarily all that enjoyable in the first place.

[00:42:10] And maybe let you focus more on the key area where you have provided value in the past. Yeah, I think that’s the case. I think technology would have to change drastically more than what we’re seeing on the horizon. I think there are things that do impact the industry. And I’ve touched on this early in the in the episode.

[00:42:26] I do think, the average consumer may not have thought through all of these impacts, and they may have a perception that a robot could just as easily do your job. And so there is some level of what’s showing up in your marketing, what’s showing up in your conversations that reiterates where the value is in what you’re doing and how you actually help people.

[00:42:43] I think if you don’t, Have those conversations. If you don’t make that information part of what you’re doing, then you might get blindsided by somebody thinking again, I think wrongly, but thinking that they’d be better off with technology than with you. And so it is on you to have that leadership to be able [00:43:00] to get out there and explain really what a real estate transaction is.

[00:43:04] ’cause it’s not what most people think it is. They haven’t fully considered. That process and what that looks like. So having that leadership and reminding people, this is what I help people do. I help people navigate the complexity of the emotion really, that happens after you’ve found the home that you want or after you’ve decided to sell rather than, everything that leads up to it, which is all that most people have in their perception of what real estate is.

[00:43:26] They see H D T V and really that just talks about the interesting parts and not the emotion of what actually goes on in a deal. So there you go. The short answer is no. I don’t think AI is gonna take your job. I don’t think robot’s gonna be doing the work of real estate anytime soon.

[00:43:41] I think we will see technology helping folks out, but but overall there’s still a lot of opportunity especially if you decide to be amongst those that are leveraging AI to have an in bigger impact, to be able to maximize your time in the most efficient, or, the most effective areas that humans can interact with in the real estate space. Any [00:44:00] any other final thoughts from you, Charlie, on this on this topic?

[00:44:03] Charlie Madison: I think we covered quite a bit and I learned some things and I feel pretty complete on it.

[00:44:09] Zach Hammer: Yeah. Awesome. Awesome. Thank you so much for joining us in another episode of A Real Estate Growth Hackers. I’m Zach Hammer, this has been Charlie Madison with me. Until the next time we’ll we’ll catch you on the next episode.

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