Property AI Report 002 - Self-Employed Agents, Meta v Cats, ESTAs

In this week's PropertyAI Report, host Mal McCallion covers the significant growth of self-employed estate agents, focusing on brands like eXp and Yopa, and examines the challenges faced by these agents, including rising platform costs. 

The episode features some wild predictions from Sam Mitchell, CEO of Purplebricks, about the company's market expansion goals. The report also highlights the ESTAs awards for property market excellence and developments in PropTech, such as Jitty's pivot to a home-buying platform. 

Technology news includes scepticism around Elon Musk's robots and developments in AI with the views of Meta's Yann LeCun's on AGI. The episode also explores the impact of AI avatars in Zoom meetings, aiming to streamline workflows and improve efficiency. 

Finally, it previews potential changes in the UK budget that could affect the property market.

Chapters

• 0:45 Property Market News
• 13:35 PropTech News
• 15:32 Technology News
• 17:52 AI News
• 22:06 AI Tool of the Week

Transcript

  Hi there and welcome to the second edition of the PropertyAI  report. Here we will have a mix over the next 20 25 minutes of property market news, prop tech news, AI news and some tools of the week. Our intention here is to arm you with information about everything. You need to know this week for about property and AI.

I'm your host Mal McCallion. I have been involved in the property market for the last 25 years on the technology side, and now running an AI startup and having a lot of fun doing it. But also absolutely obsessed slash geeked out by all that is happening in these particular areas of property and AI.

Let's start first of all with some property market news. 

So what's been happening out there in the property market very much focused around this some stats that came out last week about the self employed agent side. Big numbers talking about, plus 20 percent in terms of overall uplift year on year growth in numbers of exchanges done by What we're calling self employed agents.

Now that number obviously is from a relatively low base. The one thing that I do think we need to just be very very clear on and really just be careful about is it says, and these are stats from 20, a highly respected company that provides stats and all sorts of different areas of the property market.

So self employed agents these are independent organizations. Yeah. By their nature, they are independent companies that operate generally within one particular brand or another. And utilize that brand in order to leverage promotions marketing reach the cost savings on things like, your right move subscriptions and.

access to technology and so on, CRMs and they are on the rise. We've got companies like LSL spun itself out into a solely franchise operation a couple of years back. We've also got eXp that's now up to 500, 600 branches, I think in the UK now run by Adam Day or led by Adam Day.

And there's others, Yopa, We're just starting to get into it as well. And that was announced over the last couple of weeks by Verona Frankish and her operation, which is now profitable as well. So there's a lot of movement in this sector and I think the kind of core selling point for this is really around flexibility. 

So if you are a great estate agent, and I've spoken to a couple of of them recently that have joined particularly eXp and what they are able to do is to essentially be their own bosses, but with their own the kind of support and community, let's not forget how important that is networks of other agents sharing best practice access to this great tech but also to a really solid brand.

And it going out there some taking their first steps into this world of of self employment and some of them are doing amazingly well. Actually it's almost like that kind of casting off the yoke of a brand that they may have worked for a long time. And really what you tend to find is these are really punchy up and coming contenders who've sat within established brands for a very long time, and are now feeling the confidence to be able to step out on their own underneath these umbrellas and with this particular support. 

And so it's not surprising to me that they're growing. I think again, it just needs to be tempered by the fact that this is still, probably as an, as a sector, as a segment, it can only really be four to 5 percent of the market overall right now, but it is going to grow. And I have huge faith that that more and more great agents are going to be stepping out there and are going to be doing their thing within the remit of one or other of these of these individual brands.

Yeah. What I do caution slightly is that I do think there's a little bit of a kind of false economy at play here as well. I think that the bargain nature of the subscriptions they're able to achieve through these brands at the moment with the likes of Rightmove with the likes of whichever CRM system they may be using.

I wonder whether over time, those are, those discounts are going to disappear. I understand that it is some hundreds of pounds to have a right move.  Subscription under some of these brand names, which leads me to suspect the right movies is trying to capture people within these.

this environment and then we'll do what it has done to, for example, finding country, some of the auctions, which is essentially charged them as separate individual branches in due course. So I've been speaking to agents over the last year or so, who's finding country licenses have suddenly ended up costing them a damn sight more because they have had to suddenly pay as a separate separate entity on the on right move scale, right?

Move was also tried to do with open rent, interestingly enough. And maybe they've backed off a bit from that fight, but I don't think that it's going to be long before they do come back and because, and we've very recently has fought off a takeover bid from REA group and has had to promise its shareholders that it will, Maintain the share price at that  higher level in order to for the shareholders to be confident that the current board is a better bet than REA Group coming in and trying to shake things up.

Rightmove is not a charity, just in case anybody needed telling again,  and that they are welcoming all of these self employed agents with open arms. And allowing them to have discounted rates via these brands, I suspect will turn out to be a little bit of a short term play and in due course everybody will be paying a little bit more, quite a lot more, for the privilege of being on Rightmove as everybody else has to.

Again, that said, I think this is a really good development for the industry. I think that, having more and more people out there doing greater state agency standing or falling on the strength of the service that they're providing can only be good news for consumers, can only be good news for the industry at large.

I think it is going to shake up a lot of, some of the more established brands and get them to consider.  How they might meet the needs of consumers as these self-employed agents are doing very well. You can see more established brands that, like the likes of Preston Baker. I know that missions down on the South coast.

A couple of examples. You've got Meyers and others that have been, fighting the kind of self-employed or fighting the good fight for the self-employed models over a long time now. And they're seeing the benefits of that and the agency UK is another.  Lots of good stuff happening in this particular sector, but yes, still relatively small, but growing very appreciably.

And I think there's plenty more that we'll be talking about these guys as we go through  the coming weeks, months, and years. So want to watch and a really interesting space.  Continuing with the second of our property market stories this week Sam Mitchell, CEO of Purplebricks was interviewed.

And the interview was released last Friday by City AM all about his plans and where he sees the business going forwards. Now, just very quick recap as discussed last week Purplebricks is laying off nearly a hundred of its team members. It charges nothing, and here's the air quotes for its service for sellers unless you want to buy all of that additional stuff.

You can't get onto Rightmove for example through Purplebricks without paying 899. And there are various other things that are bolted on that you're going to need to pay if you wish to yeah, get any sort of support in terms of your sales process. So that's aside Sam has very confidently stated that, and I'm going to be quite  Between five and 10 percent of the market is looking to achieve within the next 18 months to two years.

On the lower end of his expectations, there are 5 percent within two years which in itself is something. Incredibly ambitious is how I'm going to phrase that. I think it's borderline craziness without the team members on the ground. So remember, you've just got rid of 90 of your team, which is a significant chunk.

And there's a lot of kind of historic knowledge within that cohort as well. Now, maybe that, They're jettison because they're, they don't share the aspirations. They don't necessarily believe in the product anymore or the project anymore. But certainly that is a significant resource impact.

And if you have, as he says on the record, about 3% of the market, if you claim to be the biggest brand now. again in estate agency then to essentially double and then more your your market reach is going to take some significant investment. Now, one of the things that we know is that Purplebricks is claiming that it's free.

It is charging less than Purplebricks, old Purplebricks used to remember old 197 million in it's time from the investor cash and is now. Was then sold for one pound to  Sam and his team at what was then known as Strike is now Purplebricks again. So there's a lot of I'm going to say challenges about how you are going to turn that business that is 3 percent of the market into 5 to 10 percent over the next 18 months, two years.

And it just sounds so much like the previous sort of, I'm  not suggesting, they're smoking anything crazy in that boardroom, but, it seems like it's certainly been passed across from the previous boardroom, whatever it is. And that.  It just sounds so overly,  just like one of those things that you say just to say it.

There's no evidence that this is possible. There's no, even Purplebricks with 197 million behind it got to about 6 7 percent with, bucket loads of Trustpilot reviews that were shown to be a little bit dubious.  Particularly when they tried to ship over to America and then suddenly in the U.

S. they had hundreds of these five star reviews for a service that hadn't even launched yet. So there's loads of echoes.  and rhymes of previous Purplebricks isms that worries me greatly about where they're going to go because Purplebricks, essentially ended up as this kind of almost twitching corpse that would just throw out some really nasty anti estate agent stuff as it was going down in order just almost to take everybody else down with it.

And I just can't see how Sam and Co are going to  revive this kind of zombie. Purple zombie as the regular readers and regular listeners know that I'd like to think of it as because it is essentially that it is this kind of, re read the heated corpse of a business that is now roaming the streets trying to get vendors to to pay attention to it so that they can go and essentially take chunks out of them.

And it just feels like it's a.  Yeah, it just feels like it can only do damage whilst it continues to to wander around. Look, it's it's going to be interesting to see whether Sam can meet his ambition. I know that his backer, Charles Dunstan has said very clearly that he's going to do whatever it takes.

He's going to fund it to whatever level it requires to to make it a going concern. And maybe they can get there, but what I wonder, worry about, even in that interview that Sam was was making with City AM, he didn't hold back on taking some side swipes at what he termed traditional estate agents not answering phones and basically producing a poor service in that kind of broad brush.

Everyone's as crap as everybody else way. The Purplebricks used to talk about commisery and, all agents are just trying to screw you over kind of way. So I think that the rhetoric that's coming out of there is not does not bode well for the angle that Purplebricks is going to come to the industry at, as it tries to claw its way up to that mythical 10 percent of the market within a couple of years remains to be seen.

What specifically they're going to do, but it sounds very much like they're going to open the Purplebricks playbook from 2016 2017 and see if they can't just take everybody else out on their way down. Yeah, we'll keep an eye on that obviously, but it is yes, not necessarily the most promising precedent  next up.

On our third property market story of the week what we want to focus in on is very much the ESTAs from last weekend. So last Friday was the ESTAs annual awards ceremony. Always great fun. Always a little bit challenging because it's a whole afternoon of lots of rewards and, a reasonable amount of a thousand estate agents in one dark ballroom in the Grosvenor House Hotel park lane drinking a reasonable amount.

I think it's fair to say. But it is great fun and some amazing people bumped into I was hosted by the amazing Base Property Services, Christian and Carla, Tristan, all those guys, amazing, great fun, really good people double gold winners as of Friday, again, so congratulations to them really strong customer service, vast integrity and wonderful fun.

So that was great also saw some amazing people many amazing people as the the afternoon and evening progressed. And listen, just a shout out to everybody who won. Congratulations. These celebrating  good  estate agency, lettings agency suppliers within our industry, I think is just super important.

And this is one of the best events out there. So congratulations to Simon and Sarah as well for putting it on really great organization and a great event. And obviously led by Phil Spencer.  It was another triumph in their 21st year. So well done to them and well done to everybody who won.

Okay, next up we have every week our PropTech news.  So our PropTech news this week is all about Jitty. So for those unaware of Jitty, J I T T Y, they are an up and coming AI powered property search engine. Property discovery is probably closer to to, to a description. And what they are doing is looking to help people to discover their ideal perfect property using a combination of AI looking through pictures.

AI describes the pictures. So if wooden floors and a skylight are your thing, then Jitty will help you to find that using natural language search.  It's announced this week that it's going to flip from being a kind of portal or notional portal to much more focusing on being a home buying platform. And I think this is really smart.

Graham and the guys there are very smart in terms of their technological approach and also their relationship approach with various people within the industry. And so what I would say is that they are well worth a look. That they've, flip that pivot is very much towards. Look, we can help you as a buyer find the best properties out there to, to your specific requirements.

So your dream home  and the way they go about that, as I say, is using a combination of AI and all of the agent uploads To their site as well. They're not scraping without any authorization. So it's a really nice model. I think it's one that good agents should really have a look at and just make sure that they are, that their properties are surfacing on that.

If that's the way they want to go, it's free. To agents, and it's something that I think is going to be an interesting  future way that people are going to be using AI to find the perfect properties for them.  So that's our PropTech news and next up, let's talk about technology. 

So some big news in technology at the moment about Elon Musk, perhaps inevitably every week there's something that Mr. Musk is doing, but we're gonna talk about his robots right now. We led last week on stories about his his robo van and his cyber cab. But there's a bit of controversy around his robots that were present at that event and afterwards.

So he's claiming that these robots are gonna be available in the next sort of couple of years. For 20 to 30, 000. But it was revealed that those that were present at his event a week or so ago were essentially remote controlled by humans. So they're not autonomous and they weren't pouring drinks all by themselves.

What they were doing was actually being remote controlled by people standing around the representatives of Tesla. So I just think it's really.  It's just really worrying that actually people are going to start to distrust the technology much more, if the tech doesn't work, then fine, acknowledge it, but don't try and pretend that it is something that is, is ready to go, when actually it's something that requires a lot of work.

a level of intervention or a level of expertise that the average person is just not going to have because all that does is just shake people's faith in what's coming down the track. To be honest, Musk's got a kind of a lot of history in doing that. He's been forecasting full self driving for his Teslas since probably about 2016, 2017, something like that.

And it's always in the next couple of years, as his robots are in the next couple of years, and it just shakes people's faith in what's possible. So yeah, just a bit disappointing really about the kind of robot stuff. Again, regular viewers, readers will know through the Property AI Report newsletter, that I'm a big fan of robots.

So therefore it is, yes, perhaps yeah, more disappointing that for me that actually this is a little bit further off than anticipated. But there are other organizations, there's Figured, there's One X there is Boston Dynamics and others who are yeah, really getting it together and perhaps are a little bit further advanced than Tesla and his Optimus robots.

But yeah, again, we will see as we go through. Just how really technically capable these robots are and how much of it is smoke and mirrors. But certainly progress is being made on a number of different fronts  and it's going to be really exciting to see when we get there. 

Next up, we want to dive into our AI news section. So this has been dominated last week really by the idea that AI is dumber than a cat.  All right, and so speaks one of the godfathers of AI, Jan LeCun who is now kind of head of AI at Meta, so Mark Zuckerberg's and Jan  LeCun has often basically tried to pop this bubble that continues to be inflated by the likes of Sam Altman and  various others that AGI, which is artificial general intelligence, the moment that AI becomes as intelligent as us humans, known as AI, AGI.

And Yann LeCun is basically saying, and has consistently said, that it is garbage to say that it is round the corner, and it is garbage to say that the current the current AI, generative AI models that we have and that have proven so successful over the last couple of years have the potential to get to AGI on their own.

He says that is not true and that current AGI,  sorry, current AI, actually ACAT is smarter than it.  Which, is not necessarily too controversial when you think about how smart slash evil cats are. That actually they are very smart and able to do things that generative AI cannot.  Just to recap, I actually agree with Lacune on this one.

I think that generative AI that we have right now is really clever in that it is A massive prediction engine. All right, it has access to so much data and so many different, words, phrases, all of the kind of the stuff that you can find online or Wikipedia etc, that it is able to with a almost a magical kind of consistency to predict what the next word should be if it is asked a question or anything.

And that is what GPT 3. 5 when that came out in November 2022. That was what amazed everybody. GPT 4 back in April last year, again, blew everybody away even more. GPT 5, when that comes along, will be even better, I have no doubt. But in order to get to AGI, we're going to need something that is different to just this pure prediction engine. 

Because that's that's looking in the past that's stuff that humans already know, and we've already done, and we're already, able to to understand. What AI, generative AI right now is tremendous at is creating. Conversations that you can have with it that are  really insightful, and again, put on the wealth of human knowledge up to this point.

So you can ask it to, as I did just the other day to help you with an EA masters strapline type build up offer. For the EMS coming up on the 5th of November that we're gonna be there, do come along and say hello if you're going to but yeah what should we do? What should be our giveaway at that particular event?

How should we structure ourselves? This is who we are at model prop. This is what we do. And it was just really great at helping us to theorize around it and to know back things backwards and forwards. Instead of having to spend forever in a few meetings on it, you can actually just bounce these things backwards and forwards.

And it is a tremendous asset and assistant to, to that thought process, to those thought processes. Yeah, what I always think of, and again, just to take away if you are using generative AI as a kind of start point, always look, think of it as, as your most, knowledgeable intern ever, but one that can go off at tangents and that you need to check the work off.

But it is just so good to have those conversations and to bounce things out of there and it will go off and it will find things out that you would never have, it wouldn't take you ages to do. So it's really, it's really knowledgeable. But it is quite naive. And can therefore go off on tangents and get off on it.

But the more you talk to it, the more you keep asking it questions, refining it, it can give you some amazing help. Again it's incredible. But I do agree with Deanna Lacoon. AI is dumber than a cat. From the perspective of a cat can appreciate it and has an understanding of the real world around it.

I think that's the difference. It has a notion of what the world is around it and can react to things like that. Whereas AI doesn't have that worldview or that world understanding. And it is purely based in almost a statistical analysis of everything that it has learned or been trained upon to this point. 

So that's our AI news. Next up, let's talk Tool of the Week. 

Alright, so really fascinating Tool of the Week this week. Zoom, everyone's favourite pandemic go to and way of seeing other humans,  has this week released in tandem with Haygen,  the ability to have your avatar attending meetings for you.  Sounds exciting, right? So essentially and please, anybody that I'm having meetings with in the next few weeks or so, don't worry, it will be me, I promise.

Can't necessarily promise much beyond that, but we'll always tell you. But yes if you go to our website, modelprop. ai forward slash insights and have a look at our blog, then you'll be able to see me having a meeting with myself or with my AI avatar all about yeah, what it can, Do and so on and so forth.

You want to see it in action, but essentially, the idea is that that if you train your avatar up well enough. On information that you know,  or that is going to be useful in any particular environment. Then, people, other humans, and in due course, their AIs, will be able to meet with your AI.

And things can be thrashed out relatively quickly without need for to actually go to and check with you. Now, whenever I talk, I've talked to anybody about this in the last week, it's been quite hilarious. Cause then we like I'm never going to meet with anybody, never going to meet with anybody.

It's AI advertised so rude. Sorry. That, and the responses via from it's so rude to, it's just going to be utterly pointless. Now, I think that if you actually look at what meetings are and you boil them down to what the purpose is. Then actually, AI avatars can have a role here. I'm not suggesting that they can completely take over.

But I do think that, meetings, the intent of meetings is often really to exchange information and get a decision and then some actions that come off the back of that.  All right, so that's it. It's exchange information, come to a mutually agreed decision, and then work out what the actions are going to be off the back of that.

Meetings in general, in my experience, and perhaps yours too, are incredibly inefficient ways of doing this, because you get a number of people in there, all of whom have to give up their time. Oftentimes they're sitting there just listening to one particular person, perhaps the most dominant person in the room, the one with most authority, and they're all just waiting to find out what they say, and then they're going to go off and do it.

So this kind of exchange of information piece can be done perhaps. With AI once that information has been assimilated, then perhaps.  And sensible decisions can be recommended off the back of that, then humans can say actually, this is the recommendation from the AIs. Do we agree or do we not?

And then, and that doesn't have to happen with everybody spending 20 minutes of their time talking about it. It can be an exchange of emails or an exchange of, of ideas or a conversation that this kind of across a network through, through instant messaging or whatever. And then, actually then the actual points that come off the back of it can be relatively straightforward as to who the heck's supposed to do the work off the back of that as well.

I think this is going to be really interesting and I think it's going to be something that is well worth paying attention to. So like I said, do go and have a look at what we've been playing around with. But at the same time, I think it's going to be a little while before everyone gets really comfortable with it.

But I don't think I'm going to be alone in wishing and celebrating, wishing for and celebrating the arrival of less pointless meetings, because my God, over my career,  there have been many. many pointless meetings and I look back on large swathes of my life that have been wasted sitting in yes, very badly air conditioned meeting rooms listening to things that are not necessarily taking us anywhere further forward.

So look look forward to that. Be excited. Yay. But also, yeah. Don't, think hard about how this might be implemented within your organizations.  And test it out, right? Actually, go into it with  an open mind about what the potential might be because it could save you and your business a heap of time and be really good for everybody as well. 

So that is our tool of the week. And finally, we just want to have a quick look at what is coming up this week.  All right. The big kind of preparation this week, is for the budget for next week. There's so much talk here in the UK about what Chancellor Rachel Reeves is going to do.

And a lot of it's centering around the sort of the property markets and how it's going to impact. This morning's big sort of theorizing off the back of a report in the times over the weekend is that actually the the stamp duty thresholds are going to return back to where they were.

There's going to be more for people to pay as they are transacting on properties. And that's going to be a bit of a clog in the market. Now, if that doesn't come in until March as it's expected then there's going to be a lot of racing to get all these transactions done before that happens which is going to be good short term boost for the market But as ever, whenever there are big government changes in any regulation Then it can be really painful for the market.

Yeah Hopefully we're going to get a bit more clarity on that this week There'll be no doubt a lot of horse training going on behind the scenes But yes, it's preparation week for the budget next week. And I think all eyes are going to be on how much of those, whether those rumors are scotched or not, and whether we're actually going to be able to Get some clarity on what's happening in the property market as a result of all of that governmental activity. 

All right. Listen, that's it for this week's Property AI Report podcast. Thank you so much for being part of it, for listening in. I hope it has been interesting and you've got some insights that perhaps you did not have before you started listening. And we're going to be back again next week with the third Property AI report and hope to see you there.

We've got the videos of this are going up onto YouTube. We've got some shorts that we're going to be sharing as well. So do keep an eye out for those if you missed any of it, but thanks once more. I'm Matt McCallion and I will catch up with you again next week. All the best. Take care. Bye bye.