Virtual Tours, A Success Story

Nobody gets to escape change, not even Real Estate Brokers. Over the years selling Real Estate has migrated from classified ads in local papers to ads in online portals, with over 90% of all property searches starting with an Internet search today.  Early on, property sellers could get away with simply posting poor quality floor plans. However, once digital cameras became common consumer items, color photos quickly found their way onto the portals as “must have” items.

Several years ago technical pioneers experimented with adding 360-degree photos instead of just 2D photos, but the technology was too expensive and the results were unimpressive. Lately, however, this has also begun to change. Not only are there numerous applications available to help people put together what is commonly referred to as “Virtual Tours”, the prices of cameras capable of taking 360-degree photos has dropped to the point of affordability for any business.

The market for creating Virtual Tours has grown into a range of software and hardware products than span the range of low end to high end, and just about everything in between. The dominant portals in Switzerland have begun offering support for Virtual Tours as part of their standard package and some of them, such as ImmoScout24, have even begun to work with vendors of Virtual Tour hardware to promote the technology.

What makes Virtual Tours compelling?

  1. Virtual Tours are easy to make.  A Virtual Tour for a small apartment can be made in literally a matter of minutes. Virtual Tours for larger properties take more time and are certainly more complex, but tools exist that allow you create Virtual Tours with literally just a few mouse clicks.
  2. Virtual Tours are inexpensive to make. The equipment required for capturing 360-degree images starts at less than four hundred CHF and can be used as easily as any existing digital camera.  There are tools that allow you to use your iPhone to capture 360-degree images and upload them to portals that will help you stitch them together and then host them for you. At the high end, you can purchase equipment that will capture almost any size property in high resolution, both inside and outside, stitch it all together for you and present it in a highly professional manner – all with, again, literally just a few mouse clicks. A good benchmark is to say that a Virtual Tour should cost less than 0.1% (one tenth of one percent!) of the property value.
  3. Virtual Tours increase the value of a property. While this is a very contentious statement, data backs it up. Consider that if you can create a Virtual Tour for 0.1% of the sales price of a property, you don’t have to have significant price increases to enjoy ROIs in the range of 1,000%. Show me any other investment that generates this kind of return!
  4. Virtual Tours are easy to share. Although you often can, you don’t have to host most Virtual Tours privately.  Most vendors who will provide stitching and hosting services for you.  That’s why it is so easy for a real estate sales portal to support them – it is typically nothing more than a URL entry in the property data.
  5. Customers engage longer with Virtual Tours. A customer will spend a few seconds looking at 2D images, but they will spend much longer exploring a property with a Virtual Tour. Anybody who knows marketing knows that the more time a customer spends with a product, the greater the chance of them buying it.
  6. Virtual Tours reduce the on-site visits to only seriously interested customers. While not every realtor likes this, it is an inescapable consequence of Virtual Tours.

There are many realtors who shun Virtual Tours because they feel that it is important to be able to establish a customer relationship before a property is visited. This way, if a given property isn’t satisfactory, other properties better aligned with the customer’s needs can be presented.

But, is this really what customers want? Increasingly, the answer is “no”. Looking at things from the customer’s viewpoint, it is far more desirable to not waste time visiting properties only to be disappointed. At the high end of the market, you can expect that your customer is already very busy and won’t have much time for onsite visits. They will economise their time by filtering out undesirable properties as quickly as possible. From a customer’s perspective, Virtual Tours are an excellent opportunity to weed out properties that don’t meet their needs and quickly narrow the focus to those that do. To that end, once a customer has grown accustomed to viewing properties using Virtual Tours, when do they stop looking at properties that don’t offer Virtual Tours?

Fad or Tool?

As with anything new, the first suspicion is that we are dealing with a fad that will quickly fade away. Perhaps the best way to validate the value of Virtual Tours is to look at market adoption.  Which portals are using Virtual Tours and what adoption rates are they experiencing?

Statements

Casasoft / Casatour.ch

The number of virtual tours created on our software has tripled in the last 12 months. Most of the real estate brokers are very happy to be able to increase the quality of the on-site visits and reduce the time they spend doing visits which are not convincing. But this is not the only reason. On one side they are being requested by their own clients to have more than just a few pictures and to create a more immersive experience. On the other side, virtual tours are also a clear statement of modernity towards potential clients as well as competitors.

ImmoScout24.ch

Immoscout24 has been supporting virtual tours for almost two years and is currently working actively with Ricoh and Matterport to make virtual tours available and affordable. With more than 1500 virtual tours in Switzerland, the use of Virtual Tours on Immoscout24 has doubled in the last 12 months and we are confident that the use of virtual tours will continue to grow strongly in the foreseeable future. Virtual Tours bring with them the well-known customer benefits that a property is always fully accessible, and the efficiency in the management of property visits increases enormously.

Homegate AG

Last year, we experienced an increase of about 30% more VR-related listings. Currently we have more than 1000 advertisements with 360 degree tours of over 20 providers from Switzerland, USA, Germany on homegate.ch. We observe that the 360-degree tours slowly but surely assert themselves and homegate.ch offers its customers a nice number of objects with a virtual tour. In addition, VR tours come from a large number of providers, some of which are also affiliated with homegate.ch. We also gladly support other tour providers.

REA Group

Buyers are 60% more likely to email an agent and 95% more likely to call an agent a properly they’ve seen on realestate.com.au that includes a Matterport 3D Showcase.

Redfin

Homes sell an average of 10 days faster and for $50,100 more than comparable homes thanks to Matterport 3D walkthroughs, advanced presentation technology, and great customer service.

Apartments.com

Visitors to their website spend 3x – 6x more time engaging with property listings that offer a Matterport immersive 3D experience. Properties with Matterport tours receive 49% more qualified leads.