The real estate industry thrives on the timely dissemination of information. Until recently, real estate professionals were the exclusive custodians of that information, and they held it close to the vest so that prospective buyers and sellers had to seek them out.
But then the Internet changed everything.
One of the first times that information technology affected the real estate industry was when Realtor boards automated their regional multiple listing services in the 1980s. Member brokerages could access listings, recent sales, tax information, and other property details online through dedicated computers in each office.
Even when the World Wide Web became accessible to the general public in 1991, real estate professionals still marketed their services and listings through classified ads in newspapers and specialized industry magazines.
The real estate industry quickly figured out that online exposure was much broader and much more economical than anything they could do in the newspaper. By then, the explosion of online real estate information was well underway.
A Paradigm Shift for the Real Estate Industry
Just as it disrupted the financial services, travel and automotive industries, the Internet—and its ubiquitous accessibility worldwide—caused a major paradigm shift in the way the real estate industry transact business.
Since the beginning, one of the real estate industry’s biggest value propositions was that it had the list of what properties were for sale. Today, internet companies publish all that information and push it out to a broad audience.
Real estate listings moved from off-line listings available only to real estate professionals to online listings on major Internet portals. The major portals generated a tremendous amount of traffic providing real estate information to people buying and selling houses.
Leveling the Real Estate Playing Field
Consumers’ appetite for online real estate information became insatiable. The more they got, the more they wanted, and they began steering the demand. This led to a fundamental shift in the industry—until now, Realtors and the MLS had controlled what data was presented, and how it was published.
But consumers wanted information that the real estate industry didn’t necessarily have much interest in displaying, such as homes that were for sale by owner, and home price estimates, which local realtors had historically provided to buyers and sellers.
New companies cropped up, seemingly overnight, to provide the kind of information—and the kind of online user experience—that consumers were demanding, leveling the playing field in the process.
The Next Evolution for Real Estate
The next generation of home buyers has grown up buying and selling everything online, from clothes and shoes to televisions and cars. Eventually, they’ll want to buy real estate online, too, experts say.
It’s almost inevitable that within 10 years the majority of real estate transactions will be completed online. It’s what the next generation of home buyers will most likely demand.
Even the paradigm for conducting a property search is very different from what it used to be, thanks to today’s technology.
Real estate professionals will have a role no matter what happens. In fact, the biggest challenge faced by real estate professionals isn’t whether technology will make them obsolete, it will be coming up with a new value proposition that reflects how they can help consumers in a tech-driven marketplace.
SOURCE: Joel Cone smartycents.com