CaveHunt is a real estate agency that specializes in managing rental housing units in the United States. The business manages over 500 rental houses in the country that includes both residential and commercial spaces. The firm agrees with property owners to help in the management of their units including servicing the houses, collecting rent, finding tenants, and handling all landlord-tenant disputes with the help of legal personnel. Therefore, the core objective of the organization is to help create the ideal business relationship between the tenants and the property owners. More so, the business also seeks to optimize the rental spaces available while offering the best services to potential clients across the country.
The management of the company is decentralized in the various cities the company operates. Each office has about ten fulltime employees that facilitate the operations of the organizations. The personnel in each local office include a branch manager, accountant, secretary, human resource personnel, and sales personnel (account managers). The organization is then headed by five-member executive directors that ensure all branches function appropriately.
CaveHunt real estate agency has 100 fulltime employees who help in the operations of the organization. About half of the employees of the company are sales representatives who help the business to get new property owners to sign up and tenants to take up the available spaces. In some cases, the company hires temporal sales agents when the workload is more than the permanent staffs can handle. CaveHunt also collaborates with other real estate agents to help the client get the ideal rental unit, either for residential or business. For instance, when a client needs a rental space that is not available with the company, the salespeople will contact other agencies and find what the client needs.
Statement of Problem
The real estate industry is growing fast as the demand for both commercial and domestic property increases. Therefore, it is expected that the use of technology will help the service providers and the clients to access and process critical information quickly. A study by Cilluffo, et al. established that the number of households renting their houses increased from 34.6% in 2006 to 43.3% in 2016 (1). Apparently, many young people in the United States are today finding it hard to own a home and opt for a rental apartment or house. The same research found that 65% of adults aged 35 years and below live in rentals and only 21% of those aged 65years and above live in rented houses (Cilluffo 1).
The above statistics suggest that the demand for rental houses is on the rise across the country. Young people prefer to live in urban areas where they have to rent a living space as opposed to the rural areas where most households own their houses. Sakaria and Stehfest argue that millennials have a tendency of being adventurous in their lives, they love exploring the world by moving from one job or place to another in their lifetime (3). In as such, they are likely to shift from one city to another within a short period and seek a rental house. They will need accurate information about rental houses available and the features on offer by the rental agencies.
The 2008 economic crisis also discouraged many people in the United States from buying homes, leaving them with the option for renting. Aalbers explains that the economic downturn was partly caused by financial institutions that offered unsecured mortgages to clients (44). Most of them defaulted and the banks faced serious problems that affected the entire economy. The fear of taking mortgages implies that people would prefer to live in rental houses that are safe and reliable. The demand for quality rental services is in high demand as few people are eager to apply for the risky mortgages offered by the financial institutions. Eventually, the situation requires the real estate agencies to have a quality provision of rental services that will satisfy the demand of the young American middle-class households.
More specifically, people have severe challenges with credible information on the rental spaces available in a given place. Those who are looking for a house for residential or commercial use have to take time visiting numerous websites and physical sites before they settle for an ideal unit. Gibler, Black, and Moon agree that even in the internet era, people find it difficult to get a good rental place because of the confusion offered by the advertisers (241). Some adverts are not genuine while others have exaggerated features. A prospective tenant has to make numerous calls to agents before getting a good rental house, especially in the major cities in the country. In most cases, the adverts are outdated and the rental units displayed are not available by the time a client calls to make an inquiry.
Real estate agencies offering rental services, such as CaveHunt, also have trouble linking with prospective clients. The companies spend a lot of money advertising for rental spaces on both online and the traditional media. They make numerous calls to property managers and clients trying to offer information on the features on offer in the various spaces available. Obviously, there is need to consolidate the data available on available rental spaces within specific urban areas and ensure only genuine agencies are dealing with the clients (Moshir, Moshir, and Shafiezadeh 7). Additionally, the agencies also need to have seamless interaction with their existing clients. They need to have prompt information on those who have paid their rents, those intending to move out, and those seeking bigger or smaller rental units for a change.
The Goals of the New System
Based on the analysis of the problem, the new proposed system will offer fast, accurate, and reliable information to people seeking rental units in the major urban centers in the United States. The system will consolidate the information available on the rental houses available within a specific region and display the information to prospective clients on a portal accessible using a mobile phone app and website. The core goal of the new system would be to enhance the communication between the real estate agencies and their clients. It will imply that prospective tenants do not have to go through numerous adverts looking for an ideal house to rent. The data collected from the real estate agencies in a specific city will give updated and accurate information on the units available, their costs, and features.
Additionally, the new system will improve the communication between the real estate companies and their existing clients. It will reduce unnecessary paperwork and physical visits for both parties. The apps will serve as a customer relationship management system. Lee explains that a CRM system is critical for modern businesses (649). The system offers a two-way communication channel that enables customers to send feedback to the business and the organization also sends important information to the customers. Therefore, in addition to serving as a marketing platform, the new system will help in building the relationship between the existing customers and the real estate agencies offering rental services.
Most importantly, the new system will save the cost of operation for real estate agencies. That fact that it aims to consolidate data and connect clients implies that the companies will spend less on manpower and marketing functions. Rahimi, Liu, and Andris assert that information technology systems may be expensive to set up but have long-term cost-cutting benefits (7).
Alternatives Considered and Solution Selected
The real estate business in the United States is privatized but with oversite from the government authorities. The prices of rental units are subject to the market forces of demand and supply. Therefore, any initiative to develop solutions for the public has to come from the private firms and other stakeholders.
The first alternative considered was for CaveHunt to develop and implement the new system independently. The move implies that the company will invest in the development and marketing of the system across all the regions it operates. The system will help CaveHunt to interact with its customers only and it can only have data that appertains to its portfolio of housing units for rental. The advantage of this option is that the company will reap maximum returns from the venture. It will also have the option to customize the system with its brand symbols and messages. However, the company will also bear the loss alone if the system fails to break-even by saving advertising costs. More so, since CaveHunt does not have sufficient housing units, it will not offer clients the variety they need when searching for rental spaces.
The second option will be to collaborate with other registered real estate agencies in designing and implementing the new system. All the willing agencies will contribute to financing the new system and will also have equal opportunities in uploading their data on the platform. The real estate agencies will also use the new application to contact their current clients. Therefore, the system will provide for a secure portal where clients can have confidential communication with their respective agents besides the public platform for searching the available rental spaces. The advantage of this option is that the cost of investment would be shared and so will the losses. Most importantly, the many real estate agencies that will upload their data on the system will give users a wide array of housing units to choose from. The agencies will also help in marketing the new application to a wider audience resulting in greater benefits for the industry.
Therefore, the company selects the second option in the implementation of the new system. Incorporating other agencies in the venture will give the system credibility and help in achieving its objectives. It is obvious that CaveHunt cannot satisfy the increasing demand for rental spaces in the major cities in the United States. Instead of having many rental houses applications from each agency, it is prudent to have a unified system that allows the public to have access to big data on real estate rental spaces across the country. The unified system will also lock out the unregistered companies that are likely to swindle users by advertising non-existent rental houses, spaces, or apartments.
Details Concerning the Solution – Technology and People
The solution involves the development of a mobile application system and website that will offer quick an accurate information on the rental units available in a specific urban center. Therefore, the application will have localized information availed to the users based on their GPS positioning or their search keywords (Moshir, Moshir, and Shafiezadeh 12). Additionally, the app will also give the rental agencies the ability to manage their existing clients by communicating with them directly. The following are the details about the proposed new system.
a) Targeted people
i) Real estate agents dealing with rentals
The management and employees of real estate companies dealing with the rental unit will be key users of the new system. The firms will be the main sources of data for the system that the public will rely on to get accurate and valid information about rental units in urban centers in the United States. The agencies will also design and maintain the system.
ii) Members of the public
The system will offer readily available information to the public through the freely accessible mobile phone application and website. People looking for rental spaces for either business or homes can log into the system, search for their preferred features and get options from the real estate firms subscribed to the system.
iii) Tenants of subscribed agencies
Tenants of the companies incorporated into the system will have special accounts on the app and website that will enable them to communicate directly with their agents. They can request for bigger or smaller rental spaces, report repair works needed, and give notice of lease termination.
b) Technological system
i) Database
The system will use advanced SQL database management software that enables efficient organization and processing of information. The use of the high-speed database system will enable quick processing if users search from the data deposited by the backend users. The database will also have multiple secured accounts that will allow all the companies subscribed to the deal to upload their data simultaneously.
ii) Interface
The application will have a friendly user interface that will enable not expert users to operate without any difficulty. Even the back-end of the system will have an easy to operate display that will ensure accurate and quick uploading of data by the real estate agencies.
iii) Connectivity
The servers hosting the data for the rental information system will be accessible using internet connection only. The respective users will need HSPA or 3G internet connection, or higher speeds, to connect to the servers and process their search requests. Therefore, those who install the mobile apps do not need to worry about space usage because the servers are remotely connected.
c) Information
At the core of the rental system will be the exchange of critical information by the users. People who are looking for houses to rent will have the information on their palms. Laudon and Laudon assert that at the heart of any MIS system is the need to disseminate info seamlessly. The application will provide details about the size of the house, the cost of renting, the terms of the lease, location, and pictures of the unit. Therefore, a user can contact that agency that is managing the property and book it online before the physical visit. Therefore, any housing unit that is booked will not be available in searches unless the prospective tenant fails to pay within three days of booking.
The system will also have digital maps that will help users to locate rental properties using GPS technology. Therefore, instead of a physical visit, the digital map will show the exact location of the property, including the neighborhood facilities such as schools, hospitals, and access roads.
The real estate companies on the other end of the system will also collect information from the users such as their names, contacts, and location. They will also identify the number of people interested in a given property based on searches. The system will also compute statistics on a daily basis on the number of people from a specific location who have logged in and details of their activities or searches.
Implementation
The implementation of the new system will be in three distinct phases that will include design, piloting, and final roll-out.
a) Phase 1
The firsts stage will commence with the recruitment of key players that includes all the registered real estate agencies in major cities of the country. CaveHunt will sell the idea to other companies and allow to become partners with equal status. All the companies that agree to develop the system will then appoint representatives that will design the system. A team of software engineers will work with the representatives of the company to ensure that all the needs of the industry are captured by the application. The designing team will also collect views from members of the public to establish what they need to be included in such an app. According to Coppit, understanding the needs of users is imperative in designing sustainable and effective information systems (64). The use of bottom-up approach allows the designers to analyze the problems of the targeted users and develop a system that will offer viable solutions (Thomas and McGarry 12).
b) Phase 2
Once the designing of the system is complete the next stage will be piloted for six months. The testing will be in five urban areas in the United States selected purposively. The companies will feed the data and inform the members of the public about the availability of the service. The aim would be to ensure all the features of the application and website operate as intended. All the users will submit feedback to the developers and this will help eliminate all the errors in the design and functioning of the system. The real estate agencies in the partnership will participate in the piloting phase by feeding the system with real data on rental spaces available. The companies will also offer feedback on the appropriateness of the system to their work.
c) Phase 3
After the performance of the system is optimized, the next will see the system rolled out across all the major cities in the country. The final implementation stage will need substantial marketing budget that will sufficient awareness by the public. The awareness program will educate the public on the use of the application and the website. The campaign will also seek to bring on board other real estate agencies that were initially skeptical before the designing of the system. The aim is to ensure all the major urban areas of the country are covered and all the registered rental agencies are part of the project.
As the system is rolling out countrywide, the developers will also be continuously evaluating the performance and improving the system. Pearlson et al. note that a key element of information systems is the need for regular updating (141). The fact that the team tested the system before full implementation does not imply it is perfect. There will be regular updates that seek to optimize users experience and eliminating any identified problem.
Cost-Benefits
The implementation of the new rental information system would be costly but it would revolutionize the industry. In particular, the new system would spend considerable amounts of funds to pay the software developers, hire the servers to host the database, and market the platform to the public. There would also be other numerous overhead costs in the implementation process. However, in the long term, the real estate agencies and the general public will benefit from the new information system. The following are some of the notable benefits of the rental information system.
1. The public will find it easier to identify ideal rental spaces for residence and commercial use within their locality.
2. The real estate companies will spend less advertising for rental properties because clients will be finding them using the app.
3. The companies will also spend less on human labor because the online system will enhance customer relations functions
4. Tenants will have an easier and efficient way of communicating with their housing agents using the app.
5. The real estate companies will collect valuable information on the needs of the market based on the searches from the app.
Therefore, based on the outlines benefits, it would be okay to implement the system because of the long-term benefits that exceed the cost. Eventually, the real estate companies will save more than they have invested in the new platform. More so, people will have an easy and reliable method of searching for rental spaces across the country.
Conclusion
It is evident from the report that the proposed rental information management system proposed by CaveHunt will change the real estate industry for the better. Young people are increasingly seeking spaces to rent and they are capable of using online technology to make the process easy. Therefore, the collaboration between the rental agencies will help in gathering crucial information on one database accessible using mobile devices that include smartphones, tablets, and laptops. The fact that the demand for housing units exceeds the supply implies that real estate agencies will work together as opposed to unnecessary competition.
Works Cited
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