Uber's business model has met with such success that it has led to the coinage of a new word: "Uberization". The phenomenon is feared by some professionals and praised by millions of customers, affecting more and more sectors, including real estate. So what is it? Does it spell the doom of the real estate agent?

What is Uberization?

From the concept of the startup Uber for taxis, Booking for tourism and Airbnb for vacation rentals, Uberization refers to a business model that through new technologies, puts customers in direct contact with service providers. Payment is made on the company's platform, which takes a commission from transactions. Uberization is based on the principles of speed, direct contact and reviews left by customers about the quality of the service.

Uberization in the real estate sector

The press, including specialize media, regularly call Uberization inevitable for the real estate sector. Indeed, new ways of managing residences have emerged, proving that its relationship with real estate is developing quickly. For example, it has become common to house-swap for vacations or rent out a room to make a little extra cash. These aspects are a full part of the context of Uberization because they are done via digital platforms. At the same time, the most recent studies show that property remains a key goal in individuals' lives. And although individual-to-individual sites have had real success, the share taken by real estate agents have also made progress. The Uberization process in real estate is therefore debatable.

What is being the success of Uberization?

Specialists in the digital economy specify that the success of Uberization, across all sectors, depends on three factors: the economic significance of the market, the caricature and ignorance of agents in this market, and finally, the arrival of a new generation of customers, which was born with new technologies. Yet, the real estate sector has all these elements. In particular, digital platforms offer direct access to information, which leads to the false idea that real estate agents are "hiding something."

A bright future for real estate agents

In spite of these analyses, studies show that real estate agents are in full swing. As we have already mentioned, their share of the market has grown regularly since the 1950s. New technologies are not enemies, but advantages. They can show that they have lots of added value. Online resources, market analyses, descriptions of neighbourhoods and construction reports are provided to customers, who are always more informed by professionals. Real estate agents are therefore right at home in a role where advice and information are as important as financial negotiation.

Real estate agencies of Luxembourg