Four years ago, at the height of the dot-com boom, technology companies raced to offer real estate brokers “the” online platform that would enable their associates to manage leads, track transactions, oversee closings, and stay in touch with clients through a system that manages post-closing services.
The rationale for having such a platform was the competitive advantage of helping your customers and clients at a markedly increased pace. It wasn’t uncommon to hear talk of eventually achieving all-electronic transaction processing that could speed closings to a matter of days or hours rather than weeks.
But, as suddenly as efforts to develop and market these platforms appeared, they disappeared from the radar screen. Dot-coms that had seen the industry as ripe for automation struggled to survive, their capitalization sinking under the collapse of high-tech stocks and their technology platforms failing to generate widespread interest in the residential brokerage community.
Among the companies that pulled the plug or scaled back were iProperty, maker of the Chorus transaction management platform, which ended its effort in early 2001; HomeAdvisor, which rolled its Realty Desktop effort into a division within its parent, MSN; and Homestore, which replaced its e-REALTOR® platform with a lower-profile initiative that goes by the name DealTrack.
But new players have put the spotlight back on electronic transaction management. They say their products reflect a better understanding of the business and appeal to a real need in the brokerage community.
Holly Quick, whose company has been using a product from Stewart Realty Solutions, is impressed. “Once information on a transaction is put into the system, I’m alerted to everything I need to do, when I need to do it, and all the tools are in place—letter templates, forms—for me to complete the tasks immediately,” says Quick, transaction manager with Jo Ellen Nash & Co., a small independent residential brokerage in Edwards, Colo. “It’s completely changed the way I do things.”
Quick manages transactions in a team environment, led by a broker who generates most of the business, a listing manager, and four buyer specialists. At any one time, she’s managing 12–15 transactions from the point at which the transactions are placed under contract to closing. That’s up from four to five transactions she was able to coordinate manually at one time, Quick says.
Quick’s enthusiasm is in sharp contrast to reactions to earlier systems, according to Mark Lesswing, vice president of the NATIONAL ASSOCIATION OF REALTORS® Center for REALTOR® Technology. In those days, “brokers had to spend too much customizing the systems to meet their needs.”
Although today’s programs still require some level of customization for each broker client, the systems now come with applications and documents that can be used more widely among brokers, whatever market they’re in, says Lesswing.
What’s more, the field has attracted big players with deep roots in real estate, including many from the title side of the business—Stewart, FNIS Real Estate Services, and First American Residential Group—that have the resources to stay in the game. “These big players are more likely to convince people to go with them,” says Lesswing.
But boutique companies, such as GURU NETworks Inc. and Wintrans Solutions Inc., are carving out niches by marketing directly to associates and independent consultants who do transaction coordination on a fee basis, Lesswing says.
Differing end uses
Another key difference between today’s transaction management platforms and those of a few years ago: The new generation isn’t trying to be all things to all people. Instead, players are touting particular strengths for three distinct end users:
- Associates. These systems enable associates to automate lead management and help them capture clients.
- Brokers and independent transaction coordinators. These systems pull together paperwork and manage a transaction to the point of closing.
- Settlement providers. These systems, offered mainly by title companies, manage the closing process
Few systems in the market today need to be limited to just one of these functions, and indeed, companies say their platforms can be customized to manage tasks throughout the business continuum if the client wants to go that route.
Whatever the approach taken, systems today tend to have many features in common. Among them:
- Browser-based interface. Gone are the days of proprietary software that users loaded onto their computer. Systems today are accessed via a Web browser.
- Multiple users. Systems have their licensed users—those who are paying money to use the system, typically associates, brokers, transaction coordinators, lenders, or title officers. But they also have multiple authorized users. These are the people—vendors, other professionals, and principals to the deal—who access selected pieces of information on the transaction. They typically pay nothing.
- Differing access. Licensed users dictate who can access which information, thereby keeping control of the transaction. They’re the ones who work with the technology provider to determine what the system will do, what other systems it will integrate with, and so on.
- Continuous support. When you adopt a platform, you adopt a system of support to go along with it. That typically includes upfront setup and training and ongoing technical support, usually accessible online or through a call desk.
- Variable pricing. You typically pay an upfront setup fee that varies based on the number of users and the level of customization you want and an ongoing monthly subscription or per-transaction fee that varies based on volume.
- RETS compatibility. Most of today’s transaction management platforms can be made compliant with new industry data transmission standards that have been backed by NAR, the Real Estate Technology Standards (RETS), once the demand is there.
A still-infant industry
Transaction management platforms remain a new idea that has yet to enter the mainstream of the real estate industry. No company offering a platform has more than several thousand licensed users.
Eventually, however, most transactions will be managed electronically, proponents say.
“I would never go back to managing transactions manually,” says Quick, who has used Stewart’s SureClose (now RealtyAssist) since early 2003. “If I were to go to a company that didn’t have a system in place, I would set one up.”
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