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Online vs traditional estate agencies
Digitalisation of Real Estate Summit | March 2020

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About me
● I’m John Murray
● Technologist & software engineer
● 13 years in software, 4 years in real estate
● CTO at Leadhome
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About Leadhome
● A next-generation, tech-enabled real estate company
● South Africa’s first hybrid estate agency, founded in 2015
● Focused on residential property sales
● 70% market share of “non-traditional” estate agencies in SA
*based on active listings
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Let’s talk about
Online estate agencies

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Let’s talk about
Online estate agencies

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Where does technology and
estate agencies meet?

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What problems can
technology solve?

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Some insights into real
customers...
*Based on internal customer research at Leadhome

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What do buyers & sellers want?
● A good result
● Expertise - this is my biggest asset I’m trusting you with
● Convenience (no hassle)
● Good, consistent service
● Someone to guide me through this stressful time

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Pain points with traditional agents
● Poor or inconsistent service
● Tedious, fragmented process
● No transparency (“what’s going on?”)
● High fees

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Technology eats these
problems for breakfast.

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Why has real estate lagged behind other
industries when it comes to technology?

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Why haven’t estate agencies been
“disrupted” by an app?

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Image credit: Mike del Prete

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What really counts in that upper
right quadrant?

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Informed, contextual advice.

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Technology sucks at doing these.

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Real estate is
a physical asset

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Real estate is
geographically bound

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How do we build for such challenges?

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For the majority of the market,
online-only is not sufficient.

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Local property experts (agents) have a key role
to play in most transactions.

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So, if it’s not online,
then what is it?

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Hybrid
TRADITIONAL ONLINE
USE OF TECHNOLOGY
HUMAN INVOLVEMENT

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Hybrid
TRADITIONAL ONLINE
USE OF TECHNOLOGY
HUMAN INVOLVEMENT

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Hybrid
TRADITIONAL ONLINE
USE OF TECHNOLOGY
HUMAN INVOLVEMENT

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Each provides different combinations of
technology, human contact and fee
structure.

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What does a (traditional) estate
agent actually do?

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● Marketing themselves
● Canvassing
● Building relationships &
trust
● Knowing the local market
● Market valuations &
pricing guidance
● Giving informed advice
● FICA
● Photography
● Listing and advertising
property
● Responding to buyer
enquiries
● Vetting potential buyers
● Arranging viewings
● Conducting viewings
● Offer negotiation
● Contracts & legal
...and more

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No one can be an expert in all of that.

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Agency franchises provide varying,
but limited support to agents.

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As a seller, all my eggs are in one
basket.

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Let’s look at that again.

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● Canvassing
trust
pricing guidance
● FICA
● Photography
property
enquiries

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Considering the unique skills of
an estate agent,

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Which of these jobs
can only be done by an agent?

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Which of these jobs
is best done by an agent?

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● Canvassing
trust
pricing guidance
● FICA
● Photography
property
enquiries

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Agents are not obsolete, but
what they do can be optimized.

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What is the most efficient, most effective
way to do each of these jobs?

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A smart combination of
humans and technology.

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Local property experts
(estate agents)
Enabled by technology

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Other humans
(specialists)
Enabled by technology

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Online customer self-service

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A carefully designed customer experience
ties it all together.

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What does this look like at
Leadhome?

62 www.leadhome.co.za
Where we are
● 120 people
● 40% are Local Property Experts (estate agents)
● 20% are Technologists
Over time, we expect the proportion of agents to increase, as our
technology is able to scale.
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63 www.leadhome.co.za
What have we built?
● The most advanced estate agency tech in South Africa.
● ~75% of traditional agent work is automated, semi-automated,
done by clients themselves, or done by specialists.
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The average Leadhome agent sells
4x as many properties per year as
the average agent in SA.
The top agent sold 92 properties in 2019.
*Based on data from Leadhome, the deeds office and the EAAB

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1 in 5 properties
sell at or above asking price.
Compared to 1 in 50 on average
*Based on data from the FNB Property Barometer

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Properties sell 31% faster
68 days at Leadhome vs 99 days average
*Based on data from the FNB Property Barometer

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Customers seem to like it.
Hundreds of 5-star client reviews

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Strong growth trajectory -
310% growth in listings since 2017

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Strong growth trajectory -
417% growth in sales since 2017

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Significant investment in technology is
required.

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Technology is not easily transferable from
one market to another.
Software built for the US doesn’t work well in SA.

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There are no off-the-shelf solutions.
You need to build your own.

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The most impactful piece of tech is your
CRM.

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Data is everything.
You can’t improve what you can’t measure.

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Humans and technology is one system.

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Local micro-markets means
a cookie-cutter approach doesn’t work.

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Getting the right agents is important.
Agents needs to be tech-literate and open to change.

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Online vs traditional
is a false choice.

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The future of real estate is tech-enabled,
delivered by clever humans.

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Leadhome @ Digitalisation of Real Estate Summit

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Leadhome @ Digitalisation of Real Estate Summit