Blog ImmoScout24

Digitization in the Real Estate Industry - Challenges and Opportunities

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1. Michael, tell us a bit about your living situation. Where do you live and what’s your definition of a perfect house or apartment?

Michael Bütter

Michael: I live in Wilmersdorf, a West Berlin neighborhood. My ideal living space would be a very spacious apartment but with only 3-4 rooms. It should also have a sun terrace, fire place and less furniture than average.

2. You have been active in the real estate industry for almost 18 years now so you know the market like the back of your hand. What do you see as the biggest challenges in the industry?

Michael: Like many other industries, digitization is transforming the way the market and its value creation functions, unleashing new opportunities and enabling the emergence of new business models. Primarily, digitization transforms the classical communication between companies and consumers. This way digitization has also contributed to the transparency of the real estate market and I see this as an opportunity, not an obstacle. For me it means that we need to become more innovative than ever before. In addition, I think that the traditionally conservative real estate industry needs to professionalise more and to embrace change, in every aspect of the business and there is huge upside if young talents could be attracted to be part of the sector.

3. How do you see the role of ImmobilienScout24 in the real estate industry?

Michael: We see ourselves as the digitization partner of the real estate industry. Our core business is to match and connect supply and demand, creating a digital marketplace where commercial property owners, owners and potential tenants and buyers can make their real estate decisions. So we see ourselves as a partner for all stakeholders in the real estate market. In addition, our comprehensive market know-how is based on a large data source and this enables us to make valid statements about the development of the real estate market and to identify trends at an early stage. Through our data-driven algorithms and our deep market understanding, we know our customers and their needs like no other. Consequently, we can offer them individual solutions or let them discover something new.

4. How can ImmobilienScout24 support its customers to benefit from digitization?

Michael: The real estate sector still has a long way to go to catch up with digitization in contrast to e.g. retail in fast-moving consumer goods. At ImmobilienScout24 we develop information and communication tools to help agents digitize their business particularly to raise awareness for their brands. As registered customers they can be qualified as a premium partner of ImmobilienScout24 and will be enlisted in the industry directory which is the first and largest digital directory of its kind. This entry allows them to add additional info to their profiles and thus enhances the reachability of their business and generates more leads. In addition, we also offer our registered customers the possibility to join our knowledge exchange platform Campus which bundles all relevant industry topics that a real estate professional needs in his or her daily business.

Since spring 2016 we have also been driving the implementation of virtual reality. Our recently conducted survey shows that around 80 percent of apartment hunters would use virtual tours to get a better picture of the space distribution of the property. At the same time almost half of all surveyed agents are sure that virtual tours can save time because the searcher can already make a picture before the inspection and decide which real estate he or she wants to see live. As of today, several thousand real estate exposés with virtual tours can be seen on our platform.

As for real estate provider agents, we make it easy for them to create virtual tours by offering the app Virtual Tours: ImmobilienScout24, a useful and self-explanatory tool that helps consumers experience properties not just emotionally but at any time.

5. This also means that digitization has significant impact on the workforce in the real estate industry since it requires new skills?

Michael: Yes, the impact of digitization on the real estate industry is even more comprehensive than it may seem at first glance. Some fear that digitization and algorithms will replace humans but they overlook the big potential of digital processes that make people more productive. In fact, the real estate sector needs a new personnel policy to keep up with the changes. In the future, personnel recruiting will also become more difficult as new talents with “digital skills” are in demand on the labor market and in other sectors. We are living in the digital age where data are considered as the key to success. And that is also true for the real estate industry. This means, for example, that the employees are asked for data competency and the professional handling of software products to analyze large quantities of real-estate market data. Consequently, real estate companies need new job profiles for their employees and the industry has to invest in an even better education. At Scout24, we count on talents who have industry know-how and data driven expertise. And we also focus on a modern leadership model going hand in hand with a lean organizational set-up. Today, the market changes so quickly because of accelerated digitalization so that decision-making in a company should be as close to the market as possible. So at Scout24, we rely on an organizational model in which a leader doesn’t have to know everything, but should be open to learn it all. Above all, he or she should coach and empower his or her team instead of applying a command and control structure.

Want to know more about Michael? We also did a video interview with him as well. Check it out (in German):

https://www.immobilienscout24.de/unternehmen/news-medien/magazin/detail/digitization-in-the-real-estate-industry-challenges-and-opportunities/
https://www.immobilienscout24.de/fileadmin/user_upload/Scout24_Logo_Stacked_Solid_w3000px_RGB_93.png
2017-06-07
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