In an effort to expand its offerings, Amazon has entered the US real estate market by teaming up with Realogy, one of America’s largest brokerages. Through this partnership, potential homebuyers can complete a questionnaire on Amazon’s platform to specify their requirements for a home. This information is then promptly shared with a local Realogy agent, who can provide further assistance.
Once the buyer has purchased a property through the agent, Amazon connects them with relevant services and experts in their area to help personalize their new home. As an added bonus, the buyer receives complimentary Amazon Home Services from Realogy, valued between $1,000 and $5,000. This comprehensive value-add model completes the “service loop”, providing buyers with a more comprehensive experience than what they’re accustomed to.
Among the services offered are various Amazon Home Services such as removalists to assist with moving, deep cleaning for a fresh start, or a handyman to assemble furniture, hang pictures, install shelving and more. Additionally, the buyer receives smart home products installed by Amazon or Amazon-vetted professionals.
Considering the household name and the added benefits that Amazon provides to buyers, this method of purchasing is likely to become very popular in the near future.
How will the market be affected by this?
Realogy, the largest brokerage in America, is set to become a significant player in real estate lead generation on the buyer side of the market following its partnership with Amazon. This move puts Realogy in a league with other major players such as Zillow and Redfin.
The collaboration between Amazon and Realogy is a positive development for the latter, as it leverages the power of Agents without posing a threat to the real estate agent model. However, it is important to bear in mind that this is just the first step. Once Amazon has established itself in the real estate space, it may use this initial initiative to launch Agent-like services or offerings that cater directly to buyers and sellers. This is the way of innovation and disruption, particularly when driven by a company as dominant and influential as Amazon.
It would be unwise to assume that some of these new real estate services will not be aimed directly at consumers, bypassing the need for Agents altogether. Therefore, caution is advised when assessing the long-term impact of Amazon’s foray into the real estate industry.
How is the real estate market in Australia faring?
The impact of Amazon Prime’s potential partnership with a large network group on the Australian real estate market remains uncertain. It may take several years before such a partnership materializes due to Amazon Prime’s gradual expansion in the Australian market.
Nonetheless, Realogy, a prominent brokerage company, has two major brands in its portfolio – Century21 and Better Homes and Gardens (BHG) – which are well-known in Australia. When Amazon Prime is ready to extend its joint venture, it will have an easier time doing so with these established brands.
Real estate professionals should remain vigilant for updates and be prepared to adapt their strategies. Given the significant influence of digital technology and empowered consumers, changes in the industry can occur rapidly and should not be ignored.
