[caption id="attachment_56166" align="alignleft" width="409"] RealAs CEO Josh Rowe believes in an open and transparent marketplace[/caption]
Property price prediction platform RealAs, which also offers users a variety of services like mortgage providers and building inspectors, says it is about to launch online ratings to keep them honest.
CEO Josh Rowe says concept will work like Uber Transport and Airbnb, where users can rate each other in terms of overall satisfaction from both sides of the transaction.
Like Uber transport, he says, sellers (and buyers) with consistently low ratings on the site may face warnings and even disconnection.
Rowe, who says the feature will be added to the site during 2016 is just waiting for the right volume of buyers and service providers to make the process worthwhile.
“We have done some testing of the technology and we believe it demonstrates the way people respond to different services and their expectations about what should and shouldn’t be provided,” he tells PPW.
“Just don’t call RealAs the Uber of online real estate,” he quips.
Rowe, who joined RealAs in 2014, when the company’s price prediction tool and platform was still in development, says the rating system will be the key game changer for the site this year.
“The ability for buyers and sellers to interact through our marketplace will allow a more level playing field,” he says. “Co-rating in this way changes the traditional relationship, of buyer, agent, seller; where the agent was the key to the whole transaction.
“We see RealAs facilitating a new relationship between buyer, seller, agent mortgage lender, building inspector and a range of other services the platform can offer.”
He adds the feature will work in tandem with the company’s existing policy of vetting advertisers to make sure they are aligned with the RealAs culture of an open and transparent marketplace that connects buyers and sellers.
“Even with all its online players, we think the current market still puts sellers and real estate agents in a more powerful position than buyers," Rowe explains.
“Our price prediction tool, property services and the associated data we can offer will help improve this situation by making a wealth of information easily accessible to both sides of the transactional equation.”
Crowd sourcing price
While the property services offered by RealAs deliver the business its main revenue base through advertising, the company was originally formed on the back of its property price prediction tool, launched in 2014, which Rowe says is the company’s key differentiator.
When Rowe came to RealAs, its directors had been experimenting on a property price prediction algorithm, but they hadn’t yet brought it to market. Given they were only working on it part time, Rowe says they were yet to develop a strategy.
Having finished a corporate digital role at Medibank, Rowe was contemplating another, but was open to the startup scene. A chance meeting with a mate, Peter Williams from Deloitte got him hooked him up with the people behind RealAs, who needed a CEO to get things going.
The people behind RealAs are industry veteran former agent and buyers’ advocate David Morrell who came up with the idea of a price prediction tool, property industry lawyer Andrew Newbold, also a name in Australian football and advertising creative director Jeremy Press.
Rowe says he and the directors funded RealAs straight out of their own pockets —and they say Rowe interviewed them for six weeks before making the decision to join the company.
Now well and truly on board, Rowe says the RealAs home price predictor is the most accurate of any similar product in Australia, maybe the world.
“You can go to our website, punch in the address of a house on the market and get a price within five per cent of what it will actually sell for,” he says.
“We’ve tested our own results, but also had independent third parties test us against the competition and they’ve described us as a step ahead.”
Getting it right
Why is RealAs more accurate than the others?
“Most people ask me this question,” Rowe says. “The simple reason is that other property price predictors look at past results. They try to form a view of what’s happening using CPI and other similar indicators to predict where price is going to go.
“While we do take past results into account, our main difference is that we also look at what the crowd is saying.
“We ask anyone and everyone who’s involved in real estate, from buyers to sellers, real estate agents you name it we ask them what their view is on individual properties.
“They can submit their views through our website and that forms part of how we predict a price and why we are so much more accurate.”
When Rowe joined RealAs he says there wasn’t much out there in terms of price prediction data other than paid reports all about historical information which he says were mainly about lead generation for real estate agents.
“There was no real interest in the buyer, and to make a property transaction successful you need a buyer and a seller.”
“We thought this was a really important space to invest time and money in we understood that if we were able to build a critical mass of buyers that it would become a really strong niche audience for advertisers and our marketplace partners.”
The RealAs team worked with software developers from RMIT University in Melbourne over four months and delivered a website and app to the market a month before the spring buying season.
“That really caught the market by surprise and created a bit of excitement. Within a couple of months we’d already won an award from Westpac and BlueChilli for the most innovative startup in real estate,” Rowe recalls.
Over the next 18 months each of the competing real estate websites started to introduce their own version of RealAs.
“But we think even thought the likes of realestate.com.au have been around for a long time their price prediction tool is nowhere near as accurate as what we do,” Rowe asserts.
No property porn
Rowe says one in 20 buyers are using RealAs to predict the price of their property which he thinks is extraordinary given the competition and the lack of market spend they’ve had available to promote it to date.
“We typically engage buyers who are about to buy a house, rather than those who are just ‘browsing’,” Rowe explains.
“That means we also get high engagement for our advertising partners who provide those valuable services such as home loans and building inspections.
“A typical online real estate business might get less than one per cent take up of those services, but we’re getting 5 per cent. That makes it a very lucrative advertising channel, and something we can charge a premium for.
He adds RealAs does not do ‘property porn’.
“We don’t have any super sexy pictures of houses, the primary purpose of our website and app is to display price, that’s it,” he says.
In addition he says the social platform RealAs offers creates high engagement.
“We allow anyone to talk to anyone, there’s no restriction,” Rowe says. “You don’t have to go through an agent if you want to write about a property, we have buyers, sellers, agents and neighbors, all writing views on properties.
“We think the reason for the high engagement is our strong focus on price. On our mission is to provide that price without distracting people with other content.”
Investment and growth
Rowe says RealAs is currently talking to investors about the next stage of growth.
“We have good interest in the business both locally and internationally,” Rowe says. “It’s exciting. There are equivalent services overseas like Zillow and Trulia and we’ve looked at how our model and could be applied in the US marketplace.
“We achieve 90 per cent of predictions within 10 per cent off the sale result, whereas the other overseas services only get 40 to 60 per cent of predictions within 10 per cent off the sale price.
“So out predictions are more accurate. We believe we could apply our model in the USA and get the same kind of accuracy that we do in Australia.”
Rowe would like to see RealAs become the choice when buyers and sellers engage, not just on price prediction but also for property services.
“First, we want to be the ‘go-to’ in the Australian property market and second, we want to take our product overseas,” he confirms.
“We know our algorithm can be scaled and delivered in overseas markets, especially the USA, UK, New Zealand and any other markets that operate in a similar way to ours.
“That’s really where we want to go.”