You can’t hold back progress and ultimately you can’t change human nature, although you’d be forgiven for thinking that you can when you listen to some of the recent debate around how the home buying and selling process could be improved.
Frustratingly, much of the talk is about proposed changes to save time and effort for Lawyers and Estate Agents, under the guise of reducing ‘failed transactions’, while ignoring the fact that consumers will generally (and rightly) act in line with their own self-interest. This usually drives the best overall economic result in other markets, so why should home moving be any different?
The answer is that it shouldn’t.
If a consumer believes that it is in their best interest to legally commit to buying a property, without knowing if it needs re-wiring or a new roof, and to lock themselves into a financial commitment, then that’s what they can do; but most won’t. If the emergence of a new higher offer shows that their property was under-priced, and taking the higher offer means that they can now afford their dream home, why shouldn’t they make that choice and accept the higher offer? Critically, if it’s in their interest to forego a reservation fee in order to pursue a better option, they most certainly will.
After most ‘failed transactions’, there are two winners (a willing buyer and seller) and one loser (the buyer or seller who has missed out on the deal). A ‘forced’ transaction, where parties commit early, without proper information, could result in one winner and one loser (a buyer, in hindsight, paying too much or a seller receiving too little).
The answer to frustrations about ‘failure rates’ lies in reducing risk by speeding up the end-to-end process, from offer to exchange; accelerating the availability of ALL of the information a consumer needs to make a choice, as well as speeding up the negotiation and advice needed to strike a binding deal.
And our customers can help. Consumer behaviour has dramatically changed in recent years, and online self-service is preferred by many customers across a range of industries. Receiving more of the information about a case earlier and in digital form opens the door to accelerating other processes, using automation and ultimately Artificial Intelligence. This will increase the speed and reduce the risk of the conveyancing process – but only if the right balance is struck between technology and the trusted, personal service that is still highly valued by many customers.
Technology can’t currently create the blend of emotional intelligence and legal expertise needed for a trusted, personal service, but it can certainly make it easier for those dealing with customers to deliver it. As the industry works towards implementing changes to make our processes quicker and smarter, the opportunity and challenge will be to ensure that we truly understand customer behaviour because, to paraphrase James Carville, “it’s the customer, stupid”.
So let’s focus on fixing the things we can fix, delivering what customers want and not harking back to bygone days where the home moving process revolved around the professionals, such as lawyers, rather than the other way around.