Internet users get access to real estate marketplace
Daily Times Monitor
If you shopped for a home in the mid-’90s, you probably anxiously awaited the newspaper’s weekend real estate listings and then headed out Sunday afternoon for open houses.
Home listing information was held tightly by real estate agents and brokers in an industry-only computer program inaccessible to consumers. But then came the Internet. “Buyers and sellers can now see within minutes a set of homes and their prices, which used to take days and weeks to see,” said Christopher Cagan, director of research and analysis with First American Real Estate Solutions, a nationwide provider of real estate information. “The Internet has revolutionized the marketplace of buying and selling homes”, says a report appearing in a web portal. The percentage of home buyers using the Internet to search for a home rose from 2 percent in 1995 to 50 percent in 2001, according to a report by Borrell Associates Inc., a Virginia-based research firm, which cited both the National Association of Realtors and the California Association of Realtors. That translates to 91,000 home purchases in 1995 compared with 2.5 million in 2001.
The increase is attributable to growing consumer comfort with using the Internet and an increase in lightning-fast broadband connections. A move among real estate professionals a year ago to share their listings online with one another could expand use further. The United States National Association of Realtors instituted “broker reciprocity,” also called IDX for Internet Data Exchange, on Jan. 1, 2002, to help agents take back control of their listings from such national Web sites as Realtor.com.
The result has been that consumers can access nearly every listing available on the multiple-listing service just by clicking on a link from a single agent’s Web site. The Internet “just makes sense,” said Peter Conti, a vice president with Borrell Associates and lead author of the study. “It’s just a much more efficient method, not just for the consumer but the real estate profession itself.”
Because of Internet use, home buyers today are smarter and more sophisticated, the report concluded. They spend an average of six weeks researching neighbourhoods and home values before they even call a real estate broker. When they do make that call, more times than not, they are ready to buy.
In fact, the study found that Internet buyers average only two weeks working with an agent before they buy, while traditional buyers not using the Internet spent 46 days. “It’s impractical and time-consuming to look for real estate any other way,” said Jerry Berns, a real estate broker for 32 years. Berns, who specializes in selling homes in the San Fernando Valley, estimates that he is showing one-third to one-half fewer homes since developing his Web site in March. (He promotes the site spending $40,000 to $50,000 annually in traditional advertising.) At the same time, he estimates his business has increased one-third since he’s been online at anylisting.com.
While some brokers and agents balked initially at showing a competitor’s listing on their own Web site, many now have faith that the consumer browsing their site will call that broker to represent them in a deal.
In five years, Berns said, all real estate agents “will be doing this or else they will be working at Sears.” It is difficult to estimate how many agents in Southern California have Web sites and how many are participating in the optional “broker reciprocity,” but nationally there are an estimated 50,000 broker sites in cyberspace, according to the Borrell report, and 250,000 individual agent sites. Finding agents and listings online has never been easier. The big real estate portals, such as Realtor.com and HomeGain.com, connect prospective buyers to agents and provide listings with photos and, in some cases, virtual home tours, by typing in a city or ZIP Code.
Search engines such as Google.com or Yahoo.com can connect home seekers with particular agents and real estate companies, many that link to the multiple listing service.
“Ultimately, more and more realtors are coming on board,” Conti said. “They don’t want to be left out.” The Internet has the advantage of allowing for frequent listing updates. While the National Association of Realtors recommends online listings be updated weekly, the Borrell report found most agent sites are providing new information at least every few days and sometimes on a daily basis. “We know that is what home shoppers want,” Conti said. And that’s what’s driving the changes: consumer habits and demand.
When Martina Rivera first bought a home five years ago, she wasn’t Internet savvy. “But now we are getting more comfortable using the Internet to buy other things,” she said. More important, the 24/7 aspect of the Internet appealed to Martina and husband, Jose.
As working parents with three children ages 4, 6 and 11, the Riveras had to scramble when their own home in Arleta, in the San Fernando Valley, sold in just three days - before they had a chance to look for a new one. “We started panicking,” said Martina, who owns an automotive accessories shop with her husband and works every day but Sunday. “We would come home from work late and we didn’t have time ...”
Martina would get her children fed, bathed and in bed and start searching for properties online late into the night. Just 10 days after starting their search, the Riveras closed escrow in August on a $449,000 home in Granada Hills - a property they received information about by e-mail from Berns’ office.
“We ended up getting exactly what we wanted,” said Martina of her five-bedroom home with a large backyard for the children.
Other buyers appreciate that they can peruse many homes and neighbourhoods without feeling a lot of pressure.
Using the Internet “was a very good way to be a voyeur without making a commitment or being responsible to a real estate agent,” said Peter Brzycki, 42, who purchased a home in Thousand Oaks in May. “It was a good way to get educated without having to commit.” Brzycki, an executive director of a non-profit organization that works with troubled youth and their families, found agent Barbara Simmons online with a general search for homes in Thousand Oaks. Her Web site is thousandoaksproperty.com.
As with others who have embraced Internet technology, Simmons, 56, of Realty World Equity Center in Thousand Oaks, California, asked Brzycki to register on her site and provide parameters on the home he was seeking. Simmons’ site, which she started four years ago, promised in return to send e-mail reports of houses matching that criteria as often as Brzycki wanted: daily, weekly or monthly. Brzycki, who buys furniture and appliances online, asked for a weekly report. But soon after, when the market started heating up and homes started moving as quickly as they could be listed, Simmons and Brzycki resorted to conducting business by telephone to get a jump on the competition.