Redfin co-founder sets out to improve the real estate virtual tour

Homebuyers who have seen glossy shots of a house often are shocked by the warts and quirks they experience on a tour – the backyard barbed-wire fence, the labyrinthine floor plan or the den's 10-foot-high mural of a French porcelain doll.

What if buyers could cross off more homes before committing to tours? And if sellers could have a 24/7 virtual open house without the inconvenience of a real one?

A new Seattle real-estate brokerage called Surefield hopes to improve the home-shopping experience by harnessing the power of video-game engines and computer-vision technology. Its service includes an online, 3-D, photorealistic model of the home that potential buyers can move through virtually.

Think Google Street View for homes – inside and outside.

"We want to give the homebuyer the ability to inspect down to the millimeter," said Surefield CEO David Eraker, who in 2002 co-founded the real-estate website Redfin. And by helping buyers become more selective about which homes they physically tour, home sellers "don't have to live on eggshells to keep it looking like a hotel every day," said Surefield COO and broker Rob McGarty, who led Redfin's real-estate operations before he left in 2010.

Current online listings for homes rarely offer a virtual tour. At best, real-estate sites generally have a photo slideshow or a video set to soothing music – the buyer has no control over the experience.

Surefield, which launched its service this week, hasn't handled any sales yet. Its founders' strategy is to attract listings from sellers who expect the detailed online tour to simplify and speed the sales process.

"If they can pull it off, it's going to be awesome," said Trevor Smith, who has test-driven the technology and is managing broker of Locality, a boutique real-estate brokerage that focuses on northwest Seattle.

A detailed virtual tour would save everyone – sellers, prospective buyers and their agents – time, gas money and frustration, he said.

At a typical Sunday open house in popular neighborhoods, it's not uncommon for 150 people to walk through. As soon as they walk in the front door, more than half of them know this isn't the home for them, Smith said.

Foreign buyers may especially appreciate the ability to winnow the list of properties they'll tour when they come prospecting.

On the seller side, Surefield's technology may appeal most to certain profiles: Owners of luxury homes who don't want massive traffic coming through the property; those with pets; and landlords with tenant-occupied homes. In some cases, buyers are required to make an offer before they can even tour the property, Smith said.

In deciding to launch a brokerage rather than license the technology, Surefield will be taking on more established competitors.

"The big challenge for them is they've got this amazing product, and they're going to have to find a great way to monetize it," Smith said.

Surefield says its virtual tours won't hide a home's flaws, though it won't go out of its way to point them out either.

"We want it to be authentic," McGarty said. "We're not going to Photoshop out a broken wall."

About a quarter of real-estate agents include virtual home tours in their listings, says Ashley Hayes, managing broker at Pointe3 Real Estate in Seattle. She has a subscription to TourFactory.com, which offers agents an easy, cheap way to assemble professional photos into slideshows and syndicate them on various websites.

"It generates leads," Hayes said. "I just haven't found a better solution."

Surefield's online 3-D tours may succeed in engaging shoppers where traditional virtual tours haven't, but if it succeeds, it will be because selling homeowners, not real-estate agents, demand it.

A case in point: Professionally shot photos are the norm in today's home listings, but it wasn't always that way.

"Agents were very slow to adapt to that," said Smith, who was previously a real-estate broker at Seattle are-based brokerage John L. Scott and Redfin. "Eventually sellers saw enough listings online with professional photographs that they started requesting it."

Surefield's technology actually uses a video-game engine similar to one used in modern games like "Halo," where a character moves through a space in "first-person shooter mode."

The company's chief technology officer is Aravind Kalaiah, a San Francisco Bay Area visual-computing engineer who led Nvidia's development of a breakthrough technology in graphic processing.

Surefield's image-capture, process and rendering system is patent pending, Eraker said.

To prove that its online 3-D home tours can translate into faster, higher-priced deals for sellers, Surefield decided to launch its own brokerage, rather than license the technology to existing ones.

"We want to control the entire customer experience," Surefield's McGarty said. "Just like Apple, you get a product that works really well."

But the brokerage side may be as challenging as the technology side: Assembling a team of real-estate brokers who can bring in listings is daunting.

Most of the big brokerages require their brokers, who are independent contractors, to pay an annual fee and split commissions with the firm.

In the short term, Surefield plans to use a commission-sharing program as well, McGarty said, but hopes to transition to a model where agents are employees, like Redfin.

"Agents there get medical benefits, stock options and other benefits," McGarty said. "We want the agents to be totally invested in the company."

As a member of the Northwest Multiple Listing Service, Surefield's listings should appear on the websites of other member brokerages, with links to its virtual tours.

Some brokerages do strip hyperlinks out of listings if they contain branded media, which is against the cooperative's listing rules, said Bob Gent, the Northwest MLS' director of business development and member relations.

"We're concerned about anything that would advertise services or detract from showing the property itself," Gent said. As long as Surefield's virtual tours don't contain its branding, he said, that's acceptable.

"We applaud new technology, so I think that's awesome," he said.

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