Why should you care about the real estate gig economy?
It’s easy to assume that the gig economy doesn’t matter to our industry. Real estate is a deal based business, where third party contractors are nothing new, right? Wrong. Take a closer and what you see won’t just surprise you, it will make you want to get ready. Because the world of work on-demand has expanded far beyond TaskRabbit and Odesk. If you’re in real estate, the gig economy should be on your radar now, because whether you’re a broker, an investor or an investment professional in the space, the gig economy is coming for you. Here are just a few ways that it might affect you…
Brokers, you will die if you don’t diversify.
From Hightower to HomeLister, tech companies are chipping away at traditional brokerage from all angles. Brokers won’t necessarily become obsolete, but as components of the role become digitized, only the brokers who evolve will survive. You live and die by the loyalty of your clients, but you know that loyalty requires more than the property and your megawatt smile, as fantastic as it might be. Clients will stick with the broker who makes life the easiest – say, for example by bringing together the team they need (from the appraiser to the surveyor to the financial analyst who can provide a true projection beyond the BOV) through an on-demand talent platform. Any broker worth his or her salt knows that driving the process can make the deal. Rest assured that if you’re not taking the time to provide additional services like this to your clients, there’s another broker out there who happily will. As real estate tech changes the face of our industry, it’s the brokers who can evolve into a one-stop-shop that will survive, and thrive.
Listen up, large employers: Exclusivity is a thing of the past…if it ever existed.
There’s good news and bad news for global investment firms. The bad: About 75% of real estate gig economy workers (at least through our platform) are employed full-time, and only gigging on the side. And they range from analysts through MDs and beyond. Whether for an old boss or through an on-demand platform, it’s nothing new. You never really had exclusivity with employees, and you knew it because you understood their predisposition toward investments outside of work (which is why exclusivity clauses in our industry are so rare). And you knew that if they had time to run a marathon or raise a family, they also had capacity for gig work. But there’s also good news: Your employees recognize that the real estate world is small and incestuous, so their likelihood of accepting a conflicting side-gig is about as high as their likelihood of committing any other form of career suicide. In other words, if you trust the judgment of your team, you’re fine. And if you don’t, you’ve got bigger problems.
Now, the other good news (and the part you should focus on) is that the gig economy isn’t just coming for you – it’s here for you. Your team just expanded worldwide; way beyond your expensive in-house generalists. Your payroll became easier to manage. Your team became less likely to extrapolate a general investment thesis across the globe and lose you money in the process – because a vetted local expert is now a click away. So the quicker you can shift your focus, from preventing outside work to leveraging the world’s best investment talent on a project-basis, the further you can get ahead of the game.
A tip for top talent: If aging out of the market doesn’t concern you, pricing out of it should.
Experience is obviously of value, but we all know that everybody’s looking for a deal, including in the hiring of talent. Well, this is twice as true in a down market. So as you progress in your career, you gain experience but lose immunity to the possibility of a layoff. What’s the best way to recession-proof yourself? Establish yourself as an expert in something; someone who can be called on, whenever the need arises. The larger your pool of potential consulting clients, the lower the chance that your inbox will ever go empty. Ask senior friends who have left major firms and you’ll quickly discover that high-level consulting engagements are traditionally few and far between – almost as rare as the right full-time fit at that senior level. So getting into the gig economy, whether through your networks, a talent platform, or considering a board position, is the only way to truly prepare yourself for the one inevitability in a modern-day real estate career: a downturn.
The truth is that on-demand in real estate isn’t a trend; it’s a shift in perspective. We are witnessing a sea change in the way that employers hire, manage and value their talent — and in the way that the talent agrees to work. The question is not when the gig economy will come to your corner of the real estate universe (Spoiler: It already has.).
The question is: Will you be ready?