Ten years ago, a search for real estate would have started in the office of a local real estate agent or by just driving around town. At the agent’s office, you’ll spend a day flipping through pages of active property listings from the neighborhood MLS (MLS). After choosing properties of interest, you would spend weeks touring each property until you found the correct one. Finding market data to enable you to assess the price tag would take more time and much more driving, and you still may not be able to find each of the information you needed to get really comfortable with a good market value.
Today, most property searches start on the Internet. An instant keyword search on Google by location will likely get you thousands of results. If you spot a house of interest on a genuine estate web site, it is possible to typically view photos online and perhaps even take a virtual tour. You can then check other Web sites, like the local county assessor, to obtain a concept of the property’s value, see what the current owner paid for the property, check the real estate taxes, get census data, school information, and also check out what shops are within walking distance-all without leaving your home!
While the resources on the net are convenient and helpful, with them properly could be a challenge because of the level of information and the issue in verifying its accuracy. At the time of writing, a search of “Denver property” returned 2,670,000 Web sites. Even a neighborhood specific search for real estate can easily return thousands of Sites. With so many resources online how does an investor effectively utilize them without getting bogged down or winding up with incomplete or bad information? Believe it or not, understanding how the business of property works offline makes it simpler to understand online property information and strategies.
The Business of PROPERTY
Real estate is normally bought and sold either by way of a licensed real estate agent or directly by the dog owner. The vast majority is bought and sold through real estate brokers. (We use “agent” and “broker” to make reference to the same professional.) This is due to their real estate knowledge and experience and, at least historically, their exclusive access to a database of active properties on the market. Usage of this database of property listings provided probably the most efficient way to search for properties.
The MLS (and CIE)
The database of residential, land, and smaller income producing properties (including some commercial properties) is commonly referred to as a mls (MLS). In most cases, only properties listed by member realtors can be put into an MLS. The primary purpose of an MLS would be to enable the member real estate agents to create offers of compensation to other member agents should they find a buyer for a property.
This purposes did not include enabling the direct publishing of the MLS information to the general public; times change. Today, most MLS information is directly accessible to the public over the Internet in lots of different forms.
Commercial property listings are also displayed online but aggregated commercial property information is more elusive. Larger MLSs often operate a commercial information exchange (CIE). A CIE is similar to an MLS however the agents adding the listings to the database aren’t necessary to offer any specific type of compensation to another members. Compensation is negotiated beyond your CIE.
In most cases, for-sale-by-owner properties cannot be directly added to an MLS and CIE, which are typically maintained by REALTOR associations. Having less a managed centralized database can make these properties more difficult to find. Traditionally, these properties are located by driving around or looking for ads in the local newspaper’s real estate listings. A far more efficient solution to locate for-sale-by-owner properties would be to search for a for-sale-by-owner Site in the geographic area.
What is a REALTOR? Sometimes the terms real estate agent and REALTOR are employed interchangeably; however, they are not similar. A REALTOR is really a licensed real estate agent who’s also an associate of the NATIONAL ASSOCIATION OF REALTORS. REALTORS are required to comply with a strict code of ethics and conduct.
MLS and CIE property listing information was historically only available in hard copy, so when we mentioned, only directly available to real estate agents members of an MLS or CIE. About a decade ago, this valuable property information started to trickle out to the web. This trickle is now a flood!
One reason is that most of the 1 million roughly REALTORS have Web sites, and most of those Web sites have varying amounts of the local MLS or CIE property information displayed on them. Another reason is that there are several non-real estate agent Sites that also offer property information, including, for-sale-by-owner sites, foreclosure sites, regional and international listing sites, County assessor sites, and valuation and market websites. The flood of real estate information to the Internet definitely makes the information more accessible but also more confusing and subject to misunderstanding and misuse.
Real Estate Agents
Despite the flood of property information on the Internet, most properties remain sold directly through real estate agents listing properties in the local MLS or CIE. However, those property listings do not stay local anymore. By its nature, the web is a global marketplace and local MLS and CIE listings are usually disseminated for display on a variety of Web sites. For example, many visit the NATIONAL ASSOCIATION OF REALTORS Internet site, http://www.realtor.com, and to the local real estate agent’s Web site. In addition, the listing may be displayed on the internet site of an area newspaper. estate agents chester In essence, the Internet is just another form of marketing offered by today’s real estate agent, but it includes a much broader reach than the old print advertising.
In addition to Online marketing, listing agents may also help the seller establish a price, hold open houses, keep the seller informed of interested buyers and will be offering, negotiate the contract and help with closing. When a realtor provides these services it is referred to as being truly a full service listing arrangement. While full service listing arrangements will be the most common kind of listing arrangement, they are not the only real option anymore.
Changes in the technology behind the true estate business have caused many agents to improve the way they do business. In large part, this is due to the instant access most consumers now have to property listings and other real estate information. In addition, the Internet and other technologies have automated a lot of the marketing and initial searching process for property. For example, consumers can view properties online and make inquires via email. Brokers can use automated programs to send listings to people that match their property criteria. So, some agents now limit the services they offer and change their fees accordingly. A realtor may offer to advertise the house in the MLS but only provide limited additional services. In the foreseeable future, some realtors may offer services in more of an ala carte fashion.
Because of the volume of real estate information on the web, when people hire an agent today they should consider the particular services offered by the agent and the depth of their experience and knowledge in the relevant property sector. It is no longer just about access to property listing information. Buyers and sellers historically found agents by referrals from family and friends. The Internet now provides methods to directly find qualified agents or to research the biography of an agent referred to you offline. One particular site, AgentWorld.com, is quickly becoming the LinkedIn or Facebook for real estate agents. On this site an agent can personalize their profile, take up a blog, post photos and videos and even create a connect to their web site free of charge. Once unique content is added to their profile page the various search engines notice!
Some have argued that the Internet makes REALTORS and the MLS less relevant. We believe this is false in the end. It may change the role of the agent but will make knowledgeable, qualified, and professional REALTORS more relevant than ever before. In fact, the quantity of real estate agents has risen significantly in recent years. No wonder, the web has made local property a global business. Besides, Internet or not, the easy fact remains that the purchase of real property may be the largest single purchase a lot of people make in their life (or, for many investors, the largest multiple purchases over an eternity) and they want specialist help. Are you aware that MLS, it remains probably the most reliable source of property listing and sold information available and continues make it possible for efficient marketing of properties. So, what is the function of all the online real estate information?