How Real Estate Shapes Technology and Social Equity
Kristen Sonday discusses social equity opportunities for investors and companies, emerging real estate technology, and optimizing the homebuying experience for buyers - rather than sellers.
Kyle Stoner: Hello everyone. If you want to know what it's like to buy, sell, or even rent a property with a digital platform; you're gonna find out today when we talk to one of our early customers, Kristen Sonday. Before I introduce her, I'm gonna talk about the unreal stat of the day.
That unreal stat is 5%. That's the amount that Kristen saved when she bought a home on our platform on UnrealEstate.com.
The first thing I want to do is have you paint a picture-a before and after picture-of your prior real estate experiences versus using Unreal Estate. What did you enjoy most about the experience?
Kristen Sonday: Yes, of course. I'm so happy that you built this because before Unreal Estate, I would just use traditional online sites. To be honest, they all felt the same. I felt like they focused on the actual listings rather than the buyer and our experience throughout the process, which can be difficult to navigate sometimes.
What I really loved about Unreal Estate was initially connecting with our agent, Joel, who, at this point, is a good friend. He helped us navigate every step of the process. Most importantly, he ended up helping us negotiate a number of credits that we could use on top of the Unreal Estate closing credit, which we could then reinvest in the property.
Kyle Stoner: That's amazing. Joel's great. He's actually one of our earliest investors as well. I would love to learn more about that overall experience. You mentioned that there was some credit. You bought a new home. Obviously that is an exciting, yet could also be stressful, experience. It sounds like the savings were really the number one, and it's one of the things that we really push for as the most important thing on our platform.
Talk a little bit more about that. You saved 5%. What are some of the things you did with those savings?
Kristen Sonday: Yes. That was really important to us; to get a good deal. Especially coming out of Covid, it was really important that we restructure our life around, particularly our expanded family.
I recently had a baby and we wanted to find a bigger condo, a place where my two kids could really grow up. A lot of the reinvestment we did was around them, like building out their rooms, installing new closets, getting new blinds and curtains... It sounds like basic things, but they're actually really expensive.
On my end, my self indulgence will be this winter when we get a brand new fireplace to help me cope with the very brutal Chicago winter. Very excited about that as well. And these things add up over time, so every bit of savings really helps. Joel was instrumental in helping us navigate that.
The other thing that I really loved about working with him was he had a whole network of folks who could help us. In addition to buying our new place, we were figuring out whether we should rent or sell our prior home. He helped us fix that place up, and connected us with a number of contractors in his network to make it really attractive, and just improve the place overall. We ended up renting it through him for this first year.
Ultimately when we decide to sell it longer term, we'll be going back to Joel to help us find the perfect buyer. It really worked out all around, and we're grateful that we could work everything through him. It was a very seamless experience.
Kyle Stoner: That's awesome. That's one of the things we find with a lot of our clients or customers. People are often selling and buying at the same time, or they're buying and they're trying to decide if they wanna sell or rent. You end up helping people transition through more than one transaction. It might be two or three at once, and then more later. We always wanna help people as much as possible and there's usually savings on both sides, so we love that.
Okay, so I wanna switch gears a little bit. You and I, in our personal conversations, have talked a lot about wealth inequality, how almost a third of that wealth inequality is associated with real estate, and people not being able to take advantage of the equity in home ownership.
I would love to understand-given your background and expertise in social justice and social equity-how does real estate affect social equity and access to opportunity in our culture? What can we do to make it better?
Kristen Sonday: That’s a really great and complicated question [both laugh]. It's really multifaceted. At the most literal level, owning real estate can be a significant way to build wealth and equity in the U.S. We haven't made it easy in the past. Historically, communities of color have had legacies of things like redlining and disinvestment that hinder their ability to own properties that, in turn, could create generational wealth.
Where you live has a really compounding effect on things like where you go to school-which can help determine educational opportunities, long term and economic mobility-as well as where you end up working-which affects your salary and your benefits.
They all contribute to longer term generational wealth, which is why it's something to really pay attention to. I think it's going to actually take a combination of policy work and commitment from the private sector to invest in these neighborhoods and support people who are looking to buy property, especially first-time homeowners, in order to make real change in racial equity.
Kyle Stoner: I love that. These are multifaceted, systemic problems that we're dealing with. It's a lot of work. As a company, we have it baked into our mission that we're trying to figure out ways that we can help, besides just bringing the savings. Bringing the cost down, and bringing more affordability to the system can help more ownership. But we're always looking for new ways as well.
I would love to understand, in regards to businesses getting more involved lately, what brands or companies are doing it right? Besides Paladin, of course. [both laugh].
You can talk about Paladin too, because you guys are really doing it! I would love to understand what are some of the other ones that you admire? Any exciting campaigns or projects that you want to share?
Kristen Sonday: I really love organizations that lead by example because that is also what creates change. You can't be what you can't see. One of the big news stories of this week in the impact community is around Patagonia. This week, the founder of Patagonia decided to essentially donate the majority of the company to a nonprofit. It’s going to take their hundred-million-plus dollars of profit per year and reinvest it in climate and nature related causes.
It’s a pretty drastic measure that we haven't really seen before to this magnitude. I think we're actually going to see a lot more of it in the future. We're going to see companies reinvesting their profits, we're going to see corporate executives restructuring their lives, and different tax incentives, et cetera, to benefit public causes for the public good. As someone who works in justice tech, I am here for it. It’s really exciting to see. It's creating a lot of interesting buzz on both sides since it is a bit controversial.
Kyle Stoner: I love it. When I first saw it, my first thought was: Wow! This person decided to do this major thing for the world.
He had this great quote that said “the Earth is our only shareholder now,” or something like that. I'm sure I'm butchering it. It gave me chills a little bit. Another thing that I thought was interesting was that it made me want to buy the product.
I'm not really a Patagonia person. When I see that brand, I think about investment bankers rocking that vest. Even though I did investment banking for three years, it's not a fashion sense that I ever identified with. Then I saw him doing this thing and I was like, “Oh, I'm definitely going to get some Patagonia now.”
Kristen Sonday: That's a great point. There's this phrase “you can do well by doing good.” It really aligns business and impact incentives to do things that are good for the community, which inspires consumers to better align with your brand. It drives consumer decisions.
We're seeing that more and more, especially with younger generations who care a lot about social causes. That's one thing at Paladin that drives pro bono engagement. Up and coming lawyers (in particular) want the ability to get involved with their communities and to give back. For me, that's really encouraging because we are going to see more conscious capitalism contributing to bigger societal causes and making real change.
Kyle Stoner: I love that. So let's talk a bit about Paladin. What's going on?
Kristen Sonday: Essentially, our whole mission is to do more and better pro bono work, and mobilize legal teams around the world to get involved with different causes. We work across civil and criminal areas ranging from landlord, tenant, housing issues-which was a huge problem during Covid and coming out of the pandemic especially, as it related to different moratoriums that were around the country-things like domestic violence related issues, immigration, and over to the criminal side; looking at how we can help expunge criminal records to give people a second chance at jobs, home ownership, et cetera.
All of this work is interconnected with generational wealth and social mobility. It has second and third order consequences on folks' ability to create that wealth and move up. We're really honored to be in a position where we can better connect through our technology attorneys, who have the skills to help low income people in need, with those folks to help alleviate their legal problems so they can move on with their lives and focus on other things at hand.
It's been a really fun ride and we’re just getting started.
Kyle Stoner: I love that. When you talk about social impact enterprises, there was-for a while-that buy one, give one business model. Like Tom’s, Bombas socks, Warby Parker… But in what you do, and the very service that you are implementing in the world, every single time somebody’s using it, they’re automatically helping someone which I think is really cool.
When it's software, there's scale around it, right? You can help out 10X, 100X more people with your platform than if I was a single practitioner/attorney and said, “Oh, I want to do some pro bono work.” Well, that's great, but you all are doing it at scale. Which is amazing.
Kristen Sonday: Yes. Justice Tech is a relatively new category. It's really interesting because our business and impact sides are inextricably tied in my mind. If we're not getting impact results and we're not helping people in need, then our customers are gonna leave us. That’s the goal of implementing Paladin.
On the other side, if we don't continue acquiring customers, we can't help as many people as we want to. It's an interesting way to balance the social good and the business good. It’s working very well thus far, and we've been pleasantly surprised by all the excitement and the buy-in around, leveraging tech to help more people.
I think that we're going to see a lot more of this type of technology in the future.
Kyle Stoner: Awesome. Let me just do a quick recap/rewind. What we found is that you, as one of our early customers, saved close to 5% when you bought your home. I think the average customer on our platform, especially in a city like Chicago, is saving between $10 and $20,000.
We don't have to get into the details of exactly how much you spent, but it looks like you were able to use your savings to invest in your new home for your family which I find amazing. I am still very jealous of that fireplace [laughs] and when it gets cold here-
Kristen Sonday: [Laughs] Come on over!
Kyle Stoner: Exactly. It's brutal out here when it gets cold!
We certainly have the savings, you're able to do some really cool things with that. Lots of work to be done in social justice and social equity, especially in real estate. I would love to follow up with you after this just to get your advice on some other ways that we can really make that core to what we do every day.
We mentioned Patagonia and that announcement. That's amazing- and certainly the great work that Paladin is doing. The thing you said about this generation caring about where they place their dollars and what sort of impact those dollars have on society. That, to me, is a key takeaway from this because we've done 36,000 transactions which is cool because we've helped thousands of people.
One of the reasons I asked you about what you spent your savings on is because sometimes you find those personal stories, like “I was able to, for the first time, have an extra room. My kids were on top of each other. Now we have an extra room and that means that my kid can sleep more.” Those are real human things that everybody deals with. And, for some people, saving that 5%, not a big deal. But to the average person, it's a huge deal.
We really love those human stories. I appreciate you taking the time. Thank you so much for joining us.
Now is one of my favorite parts of the pod. We're going to do a sneaker check.
Kristen Sonday: A sneaker! All right! Show me yours first, and then I’ll show you my footwear.
Kyle Stoner: Okay, let me see. [Hoists leg up to display his sneakers to the camera.]
Kristen Sonday: [Laughs] Alright, alright! What type are those?
Kyle Stoner: These are Yeezy WaveRunners, sometimes also called OGs or Yeezy 700’s.
These are one of my favorite pairs of sneakers. First of all, I got 'em retail. Now, it’s easier to do it because Ye and Adidas are in this whole beef so I don’t know what they’re doing with production.
I actually got on the online raffle, and one these.
Kristen Sonday: [Laughs] Wow, that's amazing. That never happens. Well done.
Kyle Stoner: Yeah, I didn't have a bot or anything helping me. I just went straight up to the website and got 'em. I love that they're super comfortable. I'm a huge Ye fan, as all my friends know. I’ll leave it at that. These are my OGs. I love them.
Kristen Sonday: You're a little bit fancier than I am. I'm working from home today, working mom, so I am rocking my slippers. They’re my favorite slippers from Target.
I like 'em and they're so comfortable. You know what? I'm gonna own it. Later I’ll go out and put on some heels. But right now, I work from home. Maybe you can show me some cool sneakers to get later on, but for now I'm sticking with my cozy slippers.
Kyle Stoner: Alright, deal. I've got my own version of those. If I ever do the pod from home, I'm gonna have to show those off.
Kristen Sonday: Yes, for sure. A special appearance.
Kyle Stoner: Anything you wanna leave our guests with as we end this pod?
Kristen Sonday: I appreciate what you all are doing. I appreciate the awareness of and focus on social and racial equity.
It's really important. I think it's going to become an even bigger part of the conversation moving forward: thinking about ways that we can make society more equitable-real estate is a part of that-and thinking about how we build generational wealth. Kudos to you all for having that top of mind. Any way we can help support, we're happy to. Thanks for what you're doing and for having me on.
Kyle Stoner: Thanks so much, Kristen. Talk to you soon.
Kristen Sonday: Alright. Bye!
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