Internet brings transformation to real estate industry
By the time a client contacts Paul Ryan about a house for sale, he or she has probably already researched the property online, knows what the house looks like, maybe has taken a virtual tour of the interior and even checked out the home valuations in the rest of the neighborhood.
Ryan, a real estate broker with RE/MAX Preferred Realty, estimates 80 percent or more of property-seekers these days "look online before they even talk to anyone or pick up the phone."
"They make a decision what they want to see before ever meeting with us," said Lisa Mord, broker-owner and chief executive of All-Star Realty. "Very, very seldom do I find someone that has not done some research online."
From buying to selling, from homes to farmland auctions, the Internet has transformed how property changes hands.
Fifteen years ago the Internet was the initial source of information for 18 percent of people who bought a house, according to a report published in 1997 by the National Association of Realtors.
By 2011 this had grown to 88 percent -- and for 35 percent of home buyers, the very first step in the process was to look at property listings online, according to the Realtors' organization.
The depth and quantity of online information also has expanded dramatically. Want to know at a glance how much the property taxes cost for that new house you're eyeing? Click online and find out. Does the attractive wooded area adjoining the back yard conceal a busy highway or a set of railroad tracks? Check it out on Google Earth.
Local Realtors say it has changed how they go about listing and showing properties, the breadth of services they are able to provide and even the technological skills they have had to learn.
Mord, for instance, is never without her cell phone. While vacationing out of state, she once received an offer for a property she had listed for sale. "I was able to upload it on my phone and send it to the seller who was in another state," she said.
She used to tell clients how many phone calls she received about their property listing. These days "I tell them how many clicks I've gotten," she said.
Ryan remembers when most listings were illustrated with a single photo, usually black and white.
Nowadays he goes into a home with a digital camera, takes multiple color photos and uses them to create a virtual tour.
Much of this change has happened only within the past decade.
"It's amazing how quickly the Internet has become influential in our business and the extent to which it has become influential in our business," said Doug Fenstra of Fenstra Real Estate. "Now we are using computers and scanning and Internet services to deliver purchase agreements and listing agreements and contractual agreements. ... We just deliver a tremendous amount of information back and forth on the Internet. I'm on the computer literally more than I can believe anymore."
A handful of times customers have bought land online without ever setting foot on the property, he said. "It's actually happened."
This isn't the norm yet, however. In fact, if statistics are any indication, the vast majority of home buyers still rely on real estate agents to help them search for a home.
For most clients, it's still important to work with an agent, Mord said. "You have to have somebody you can trust and ask questions."
"You still have to meet across the table," Fenstra agreed. "That's where the real connection has to be made -- by relationship."
Although many feared the Internet would be detrimental to the industry, for the most part the opposite has happened, Ryan said. "Actually it's made it a lot better. We're a little bit faster and there's a lot more information available."
The wide reach of online listings has helped both buyers and sellers, Mord said. "It is a very effective way of getting the advertising out there."
One of the biggest challenges for Realtors these days? It's keeping up with the technological change and customer expectations so that they stay competitive.
"The issue is predicting what the next step will be," Fenstra said. "If you're not at least within two or three of those leapfrogs, you're really dead in the water."