I have a keen interest in behavioural psychology and recently read ‘Thinking Fast and Slow’ by Daniel Kahneman. His explanations for intuition and confidence highlight, I believe, the route cause behind why proptech lacks engagement with some estate agents.
I simplify dramatically, Khaneman explains that intuition is merely pattern recognition built up from past experiences that our sub-conscious mind retains and accesses continually. Our intuitions are correct most of the time! However, we all experience times when our intuition was incorrect and generally this is because our mind fails to differentiate between experiences that have a high validity, where feedback is sufficiently regular and where they don’t.
Using a typical experienced estate agent as an example, their intuition around house valuation and the state of local market is likely spot on as they are continually receiving real time feedback. However, their intuition will be far less accurate regarding projected future values and market conditions, but they will believe their intuition in both cases equally!
Confidence however, is a sense we feel through the cognitive ease of our mind being able to create a cohesive story based on our associative memory (what comes easily to mind) this process usually suppresses doubt and evokes ideas and information compatible with the current dominant story. We therefore achieve high confidence much too easily by ignoring what we do not know!
Put the two together and we can see that an estate agent uses their intuition regularly in their job, whether it is regarding valuation, local market, buyer, or seller intentions etc, they get lots of real time feedback and they rely on their intuition. However, when looking at or evaluating new proptech their intuition will be based on limited feedback of past experiences which may not even relate to the new proposition. They will continue to rely on their intuition as though it is as equally reliable.
Add to the mix an agent existing cohesive story, for example.‘Proptech is rarely useful, it’s a pain to implement, it will be costly, the last offering didn’t even solve a real problem’ etc (the type of thoughts that easily come to an agent’s mind) and you can see why so many agents dismiss proptech solutions so confidently, often without even a glance. Their confidence ‘high’ on the cohesiveness of their existing story rejecting proptech thinking confidently ‘they know’ long before they have sufficient information to reach a proper evaluation.
What can be done to overcome this?
Other than raising the awareness on both sides, proptech needs to understand the agent mindset and agency needs to become less confident and more inquisitive. A good first step would be a agent led formation of a cohort of willing agencies to be available to proptech start-ups to evaluate early stage ideas. A second step would be the formation of a database of willing agencies who would be prepared to trial successfully evaluated ideas put forward from the cohort.
Agree, Disagree, Let’s here what Proptech and Agents have to say?
Max Fuller is the creator and founder of Mutual Pre-Portal Property Platform