The National Association of Realtors protects the 6% commission model while fragmented MLS systems and state licensing laws written before the internet make it nearly impossible for startups to compete. AI chatbots could answer property questions without violating licensing rules, offering better information than many agents.
Chapters
On that note, as far as, you know, specifically operating in the kind of real estate and housing markets, you know, are there any kind of specific challenges, you know, with that that maybe that you like to share with the, you know, founders in here in the community that might be building in this space?
Yeah, I think really the biggest, there's a number of challenges being in the real estate space. You know, there's a lot of the incumbent players have an awful lot of power and influence. The National Association of Realtors, Is the second largest lobby behind the National Rifle Association. So the NRA, so the NAR's right behind the NRA. People like to protect those 6% commissions and it, it, the whole multiple listing service is, some of you may know, it's not just one, it's, you know, dozens and dozens of them around the country and they're all different. They've got different technologies, different rules. They make it very hard to do business across state lines because of brokerage laws. So our model, when we were really leaning into the retail model, we had, you know, we were probably active in 35 different states with homes and people would, you know, a lot of it was done online, but oftentimes they wanted to engage with somebody to learn more. And we couldn't have people talking about homes in states where they weren't licensed. And that made it really hard because we were, it was the, what we were trying to do was break down the geographic barriers to investing. And these real estate laws make it very, very hard because, oh, but you want to talk to someone in Alabama? Well, I'm going to have to transfer you to one of my colleagues. And they're like, well, this is not a great customer experience. So for those people who are very self-sufficient, it was okay. But those laws are somewhat antiquated. They're all written before the internet was a thing, people weren't thinking about buying properties, you know, way across the country. So those are some of the things that, you know, over time maybe some of these laws change. A lot of them are, you know, subject to some interpretation. So you have to sort of in some ways take a little bit of risk when it comes to that. Because if you followed that to the letter of the law and you'd never have a single conversation. So We would train our people to work with those customers and answer the questions they could about these other houses. But this is one of the applications I think for AI sort of chatbots that could be very helpful too. A lot of the information could be served up that way. And it's, you know, it's probably a way you could get around some of these licensing laws. If it's just information that's being provided. Reminds me a little bit of back when I was at Zip Realty and everyone was complaining about putting MLS listings online. They wanted us to show 'em in person, which is ridiculous. I think now the idea that you couldn't have a chatbot answering questions about everything about a home kind of seems silly, right? It's probably going to be more accurate and certainly going to be more accurate than many real estate agents in describing and doesn't have a bias. So, um, so anyway, so there's, there's some of the applications of the technology that, that could help break down some of these, these barriers.
