By Sara Warden
2 min read July 2019 — As demographics change, so does the way real estate is purchased. With a host of disruptive real estate companies entering Atlanta, such as Zillow, Redfin and Opendoor, all with their own added value, legacy real estate companies need to keep up.
Realogy, owner of Coldwell Banker, Century 21 Real Estate and Sotheby’s International Realty, has teamed up with none other than Amazon to tap into the younger generations and provide a new kind of real estate offering.
According to data from the 2017 American Community Survey carried out by the Census Bureau, Atlanta’s median age is 33.3 years. The largest demographic group is the 20-29 bracket, composing 21% of Atlanta’s residents, followed by the 30-39 group that makes up a further 17%. Only around 17% of the population of Atlanta is over 59 years old.
This is one reason why Amazon and Realogy chose Atlanta as one of the 15 cities to participate in the TurnKey service.
“Customers can be overwhelmed when moving, and we’re excited to be working with Realogy to offer homebuyers a simplified way to settle into a new home,” Pat Bigatel, director of Amazon Home Services, said in a statement. “The Amazon Move-In Benefit will enable homebuyers to adapt the offering to their needs — from help assembling furniture, to assisting with smart home device set up, to a deep clean, and more.”
The Amazon Move-In Benefit refers to up to $5,000 in Amazon products that come free with the purchase of a home through the platform, depending on the value of the purchase. For Realogy, the partnership adds value to its brand – its stock price jumped 20% the day the alliance was announced after having fallen from $48/share to $6/share over the prior four years.
For Amazon, the investment is practically risk-free. Realogy shoulders the cost for the program, allowing Amazon to drive traffic to its Home Services division in exchange for Realogy’s access to Amazon’s powerful platform. “For Amazon, this is a free way to experiment with attracting customers,” wrote Brad Berning, an analyst at research company Craig-Hallum.
Other platforms also see the value in Atlanta. This month, Zillow ranked it fourth-best as a location for first-time homebuyers to invest in real estate and earlier this year announced it was looking to establish its regional headquarters for Zillow Offers in the city.
“The area checks a lot of our boxes in terms that it is a well-connected part of the region, easily-accessible, and the talent pool is strong for both real estate professionals and tech talent,” said Zillow spokesperson Viet Shelton in an interview with Hypepotamus. “It just makes a lot of sense for a venture like Zillow Offers, which is trying to redefine and make (the experience) incredibly seamless for the consumer.”
Zillow Offers, a similar concept to Atlanta-based startup Knock, aims to tap into the hassle-free aspect of moving house and simultaneously find a new home for those selling on the platform. Since it was established in 2017, Knock has raised $400 million in equity and debt funding as it aims to expand nationally based on its Atlanta success.
As the Atlanta seller’s market transitions to a buyer’s market, it seems Amazon, Zillow and the others have found the sweet spot in between that favors all kinds of investment. “Some real estate experts say that if you’re going to enter this market, 2019 is the year to get it done,” said digital media strategist Brandon Barker in a blogpost for Roofstock.