Ten years ago, a seek out real estate would have were only available in the office of a local real estate agent or by just driving around town. At the agent’s office, you would spend an afternoon flipping through pages of active property listings from the neighborhood MLS (MLS). After choosing properties of interest, you’ll spend many weeks touring each property and soon you found the right one. Finding market data to enable you to assess the price tag would take more time and much more driving, and you still is probably not able to find all of the information you had a need to get really comfortable with a good market value.
Today, most property searches start on the Internet. A quick keyword explore Google by location will probably get you a large number of results. If you spot a house of interest on a genuine estate web site, you can typically view photos online and perhaps even take a virtual tour. You can then check other Web sites, such as the local county assessor, to get an idea of the property’s value, see what the existing owner paid for the house, check the real estate taxes, get census data, school information, and even have a look at what shops are within walking distance-all without leaving your home!
While the resources on the net are convenient and helpful, with them properly can 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 real estate” returned 2,670,000 Internet sites. Even a neighborhood specific seek out real estate can easily return thousands of Sites. With so many resources online how does an investor effectively use them without getting bogged down or winding up with incomplete or bad information? Believe it or not, understanding how the business of real estate works offline makes it simpler to understand online real estate information and strategies.
The Business of Real Estate
Real estate is normally bought and sold either by way of a licensed real estate agent or directly by the owner. The vast majority is bought and sold through real estate agents. (We use “agent” and “broker” to make reference to the same professional.) This is due to their property knowledge and experience and, at least historically, their exclusive usage of a database of active properties for sale. Access to 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 multiple listing service (MLS). Generally, only properties listed by member realtors can be added to 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 if they find a buyer for a house.
This purposes did not include enabling the direct publishing of the MLS information to the public; times change. Today, most MLS information is directly accessible to the public over the Internet in many 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 comparable to an MLS however the agents adding the listings to the database are not necessary to offer any specific type of compensation to the other members. Compensation is negotiated outside the CIE.
In many instances, for-sale-by-owner properties cannot be directly put into an MLS and CIE, which are typically maintained by REALTOR associations. estate agents chester Having less a managed centralized database can make these properties more difficult to find. Traditionally, these properties are found by driving around or searching for ads in the neighborhood newspaper’s real estate listings. A more efficient way to locate for-sale-by-owner properties is to search for a for-sale-by-owner Internet 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 is also a member of the NATIONAL ASSOCIATION OF REALTORS. REALTORS must comply with a strict code of ethics and conduct.
MLS and CIE property listing information was historically only obtainable in hard copy, and as we mentioned, only directly available to realtors members of an MLS or CIE. About a decade ago, this specific property information started to trickle out to the Internet. This trickle is currently a flood!
One reason is that almost all of the 1 million or so REALTORS have Web sites, and most of those Web sites have varying amounts of the neighborhood MLS or CIE property information displayed in it. Another reason is that there are numerous non-real estate agent Web 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 information sites. The flood of real estate information to the web definitely makes the info more accessible but also more confusing and at the mercy of misunderstanding and misuse.
Real Estate Agents
Despite the flood of property information on the web, most properties remain sold directly through realtors listing properties in the local MLS or CIE. However, those property listings usually do not stay local anymore. By its nature, the Internet is really a global marketplace and local MLS and CIE listings are normally disseminated for display on many different Web sites. For example, many visit the NATIONAL ASSOCIATION OF REALTORS Web site, http://www.realtor.com, and to the local property agent’s Web site. Furthermore, the listing could be displayed on the net site of an area newspaper. In essence, the web is just another type of marketing offered by today’s agent, but it has a much broader reach compared to the old print advertising.
In addition to Internet 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 an agent provides all these services it is known as being truly a full service listing arrangement. While full service listing arrangements are the most common type of listing arrangement, they’re not the only real option anymore.
Changes in the technology behind the real 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 along with other technologies have automated a lot of the marketing and initial searching process for real estate. For instance, 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 provide and change their fees accordingly. An agent may offer to advertise the house in the MLS but only provide limited additional services. In the future, some real estate agents 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 really is no longer just about usage of 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 a realtor referred to you offline. One particular site, AgentWorld.com, is quickly becoming the LinkedIn or Facebook for realtors. On this site an agent can personalize their profile, take up a blog, post photos and videos and also create a connect to their web site for free. Once unique content is put into 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 over time. It could change the role of the agent but can make knowledgeable, qualified, and professional REALTORS more relevant than ever. In fact, the quantity of realtors has risen significantly in recent years. No wonder, the Internet has made local real estate a global business. Besides, Internet or not, the simple fact remains that the purchase of real property may be the largest single purchase a lot of people make in their life (or, for most investors, the largest multiple purchases over an eternity) and they want specialist help. As for the MLS, it remains the most reliable source of property listing and sold information available and continues make it possible for efficient marketing of properties. So, what’s the function of all online real estate information?