Internet real estate

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An electronic version of the real estate industry, Internet real estate is the concept of publishing housing estates for sale or rent online, and for consumers seeking to buy or rent properties through such platforms. Often, Internet real estate properties are listed and managed by landlords themselves. However, there are few exceptions where an online real estate agent would exist, still dealing via the World Wide Web and often stating a flat fee and not a commission based on the percentage of total sales. Internet real estate platforms surfaced around 1999 when technology advanced and statistics prove that more than 1 million homes were sold by the owners themselves in the United States alone in 2000. [1] Some of the primary Internet real estate platforms include Zillow, Trulia, Yahoo! Real Estate, Redfin and Realtor.com. [1]

Contents

International e-real estate statistics

According to Realtors, 90% of home buyers searched online during the process of seeking a property and the percentage of consumers searching for information relating to real estate on Google has increased by 253% over the last 4 years. [2] With an increase of 5.5% from just 0% of people using the Internet to carry our house sales within the last decade in the UK, figures show that there will be a huge increase to a percentage of 50 by 2018. Figures will hit 70% by 2020, with only a third of the UK population seeking help through traditional methods of real estate agents. [3] [4]

Process of dealing with Internet real estate

The process of the concept of Internet real estate usually begins with owners listing their homes with its quoted price on online platforms such as Trulia, Yahoo! Real Estate, cyber home, The New York Times and even eBay. The greater number of platform owners list their properties, the greater the diffusion of information. [5] As buyers who are seeking a piece of property, search engines are usually their first pit-stop. "69% of home shoppers who take action on real estate brand website begin their research with a local term, i.e. "Houston homes for sale" on a search engine", reports Realtor. [2] Once a potential buyer contacts the seller, they would go through the details of the property – sizing, amenities, condition, and pricing, if not stated. After which, an appointment for the viewing of the property would usually be scheduled and in some cases, potential buyers may request for a refurnish of certain amenities or parts of the property. If terms and conditions are met between both parties, the buyer would usually negotiate for the best offer if interested and a deposit may be requested by the owner. Finally, both parties will agree on a date for full payment, signing on official payment, and the handover of keys to the property.

Design

Generally, buyers are attracted to Internet real estate due to its accessibility and the range of properties available. [5]

Advantages

Convenience

Due to distance decay, personal commitments, and time constraints, many turn to the web to carry out their daily activities – online shopping, online bookings and for communication between parties. Using the web to put out properties for sale and purchasing properties is no exception. The age of technology has aided in reducing time and money within Internet real estate. Users may list their properties or search for them at their fingertips, reaching out to a greater number of people significantly than traditional methods. In contrast, the traditional methods of contacting and meeting up with a real estate agent cost more money (agent and transportation fees) and time. [6]

Direct communications and transactions

One of the prime differences between traditional real estate and Internet real estate is often the middleman's absence, known as a broker or a real estate agent. At times, real estate agents may be present, still dealing with customers directly from the web. Real estate agents often profit by absorbing a certain percentage of the final sale or rent price as commission. There are cases where commission percentage hits a figure of 6% in America. [7] Internet real estate reduces the cost of an agent and conserves time spent relaying amongst three parties.

Human interaction

The use of the Internet has, in turn, reduced time between human interaction, which buyers do crave at times. [8]

Disadvantages

Just like any other operations, risks do exist when dealing with Internet real estate. There have been cases where personal details and financial information were copied when cybercriminals posed as sellers who listed their properties. Unfortunately, they published fake information about themselves and their properties and collected deposits and rent for a property of which they had no ownership. Furthermore, using the web to deal with real estate increases the chances of data being encrypted or retrieved. [9]

Related Research Articles

<span class="mw-page-title-main">Index of real estate articles</span>

This aims to be a complete list of the articles on real estate.

A multiple listing service is an organization with a suite of services that real estate brokers use to establish contractual offers of cooperation and compensation and accumulate and disseminate information to enable appraisals. A multiple listing service's database and software is used by real estate brokers in real estate, representing sellers under a listing contract to widely share information about properties with other brokers who may represent potential buyers or wish to work with a seller's broker in finding a buyer for the property or asset. The listing data stored in a multiple listing service's database is the proprietary information of the broker who has obtained a listing agreement with a property's seller.

<span class="mw-page-title-main">National Association of Realtors</span> American trade association for real estate brokers

The National Association of Realtors (NAR) is an American trade association for those who work in the real estate industry. It has over 1.5 million members, making it the largest trade association in the United States including NAR's institutes, societies, and councils, involved in all aspects of the residential and commercial real estate industries. The organization holds a U.S. trademark over the term "Realtor". NAR also functions as a self-regulatory organization for real estate brokerage. The organization is headquartered in Chicago.

A real estate agent, referred to often as a real estate broker, is a person who represents sellers or buyers of real estate or real property. While a broker may work independently, an agent usually works under a licensed broker to represent clients. Brokers and agents are licensed by the state to negotiate sales agreements and manage the documentation required for closing real estate transactions. Buyers and sellers are generally advised to consult a licensed real estate professional for a written definition of an individual state's laws of agency.

<span class="mw-page-title-main">Estate agent</span> Person or business that specialises in the selling or letting of property

An estate agent is a person or business that arranges the selling, renting, or managing of properties and other buildings. An agent that specialises in renting is often called a letting or management agent. Estate agents are mainly engaged in the marketing of property available for sale, and a solicitor or licensed conveyancer is used to prepare the legal documents. In Scotland, however, many solicitors also act as estate agents, a practice that is rare in England and Wales.

Property management is the operation, control, maintenance, and oversight of real estate and physical property. This can include residential, commercial, and land real estate. Management indicates the need for real estate to be cared for and monitored, with accountability for and attention to its useful life and condition. This is much akin to the role of management in any business.

<span class="mw-page-title-main">For sale by owner</span>

For sale by owner (FSBO) is the process of selling real estate without the representation of a broker or agent. Homeowners may employ the services of marketing, online listing companies, or market their own property. Typically, they represent themselves with the help of a lawyer or solicitor throughout the sale. As in most areas, there are detailed legal requirements pertaining to sellers and disclosures they must make.

Closing costs are fees paid at the closing of a real estate transaction. This point in time called the closing is when the title to the property is conveyed (transferred) to the buyer. Closing costs are incurred by either the buyer or the seller.

A listing contract is a contract between a real estate broker and an owner of real property granting the broker the authority to act as the owner's agent in the sale of the property.

<span class="mw-page-title-main">Zillow</span> American real estate website

Zillow Group, Inc., or simply Zillow, is an American tech real-estate marketplace company that was founded in 2006 by Rich Barton, Zillow's current CEO, and Lloyd Frink, former Microsoft executives and founders of Microsoft spin-off Expedia; Spencer Rascoff, a co-founder of Hotwire.com; David Beitel, Zillow's current chief technology officer; and Kristin Acker, Zillow's current technology leadership advisor.

<span class="mw-page-title-main">Redfin</span> Real estate brokerage

Redfin Corporation, based in Seattle, provides residential real estate brokerage and mortgage origination services. The company operates in more than 100 markets in the United States and Canada. The company has a 0.80% market share in the United States by number of units sold and has approximately 2,000 lead agents.

Flat-fee multiple listing service or flat-fee MLS refers to the practice in the real estate industry of a seller entering into an "à la carte service agreement" with a real estate broker who accepts a flat fee rather than a percentage of the sale price for the listing side of the transaction. A flat-fee MLS brokerage typically unbundles the services a traditional real estate brokerage offers and lists the property for sale in the local multiple listing service (MLS) à la carte without requiring the seller to use all services.

A real estate trend is any consistent pattern or change in the general direction of the real estate industry which, over the course of time, causes a statistically noticeable change. This phenomenon can be a result of the economy, a change in mortgage rates, consumer speculations, or other fundamental and non-fundamental reasons.

An exclusive buyer agent (EBA) (also known as an exclusive buyer broker (EBB)) is a U.S. real estate firm (or an agent or broker who works in such a company) that represents only buyers of real estate. EBA firms never take listings and, therefore, never represent the seller in a real estate transaction.

<span class="mw-page-title-main">Realtor.com</span> Real estate website

Realtor.com is a real estate listings website operated by the News Corp subsidiary Move, Inc. and based in Santa Clara, California. It is the second most visited real estate listings website in the United States as of 2021, with over 100 million monthly active users. The site launched as the Realtor Information Network in 1995, serving as a closed network for members of the National Association of Realtors. It relaunched in 1996 as a public website displaying property listings. Since then, Realtor.com claims to be the largest real estate website in the United States, and in 2016 was valued at $2.5 billion by Morgan Stanley.

Trulia is an American online real estate marketplace which is a subsidiary of Zillow. It facilitates buyers and renters to find homes and neighborhoods across the United States through recommendations, local insights, and map overlays that offer details on commute, schools, churches and nearby businesses.

CondoDomain is one of the first web-based real estate brokerages.

Ben Kinney is an entrepreneur, professional speaker, author, real estate agent, brokerage owner, and co-founder of PLACE, Inc. that started in Bellingham, Washington and now operates across the USA, Canada, and the U.K.

An automated efficiency model (AEM) is a mathematical model that estimates a real estate property’s efficiency (in terms of energy, commuting, etc) by using details specific to the property which are available publicly and/or housing characteristics which are aggregated over a given area such as a zip code. AEMs have some similarities to an automated valuation model (AVM) in terms of concept, advantages and disadvantages.

Opendoor Technologies Inc. is an online company that buys and sells residential real estate. Headquartered in San Francisco, it makes instant cash offers on homes through an online process, makes repairs on the properties it purchases and relists them for sale. It also provides mobile application-based home buying services along with financing. As of November 2021, the company operates in 44 markets in the US.

References

  1. 1 2 Delcoure, Natalya, and Norm G. Miller. International Residential Real Estate Brokerage Fees And Implications For The US Brokerage Industry. 1st ed. 2002. Print.
  2. 1 2 Google, The National Association of Realtors®. The Digital House Hunt: Consumer And Market Trends In Real Estate. 1st ed. 2012. Print.
  3. ↑ "How the internet can – and should – destroy estate agents". The Spectator Australia. 2014-06-28. Retrieved 2022-12-08..
  4. ↑ "Why Redfin, Zillow, and Trulia Haven't Killed off Real Estate Brokers". Bloomberg.com. 8 March 2013.
  5. 1 2 "The Advantages & Disadvantages of Advertising on the Internet".
  6. ↑ Lydia DePillis (2021-11-25) [2013-08-22]. "Why do real estate agents still exist?". The Washington Post . Washington, D.C. ISSN   0190-8286. OCLC   1330888409.[ please check these dates ]
  7. ↑ DARLIN, DAMON. 'The 6 Percent Solution: Skip Real Estate Agents'. Nytimes.com. N.p., 2005. Web. 1 Nov. 2015.
  8. ↑ "Real estate agents are waging a war against the internet".
  9. ↑ Fobert, J. (2013). Cyber and Data Security Risks and the Real Estate Industry. 1st ed. America.
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