Buying And Selling: Realtors ph3r teh Internetz!!!111

CNet's Declan McCullagh has an amusing take on the brewing battle between online listing services and the real estate establishment. It hits all the good points--fear of disintermediation, the Justice Department lawsuit, the consumer demand for more information, and where agents' priorities really lie:

At this week's conference in San Francisco, discussion veered between how to use the Internet to attract more customers and fear that more Americans would switch to flat-rate Internet brokerages.

A typical audience question: "Can you tell us the future of commissions?"

Switching to a flat-fee system with bonuses would remove the psychological pressure realtors exist under which forces them to push the sale at all costs (pun intended). If the majority of the free world can live within a salaried, non-commission paradigm, then the people associated with such a huge financial transaction can do the same.

The comments are even more interesting, in fact. Check this out:

Consumers are unfortunately getting a load of bad info from internet sites when doing their information gathering. Places like Zillow do not give accurate information on home values...

Now, jump a few comments ahead:

It's true that freely available information on the Internet concerning real estate, the few that there are, isn't totally accurate. But this is because of the stranglehold on the information by the realtor associations. If these types of accurate information that the realtors have are more widely available, then consumers can do some of the work themselves and the lucrative commissions that realtors currently enjoy will no longer be justifiable.

There will always be a need for agents on both sides of the transaction, just as the work that goes into collecting and publishing these listings should be rewarded. But by unlocking the information troves of the MLS and enabling real-time accuracy of "guesstimate" sites like Zillow, it will force all of the players involved to bring their best game to the table. Agents will make more money by doing better work, buyers will spend less money to get the deal closed, and sellers will save money that currently goes into brokers' pockets.

It's not a panacea, but it's a start. Information really DOES want to be free. :)

Posted at August 2, 2006 04:59 PM

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CNet's Declan McCullagh has an amusing take on the brewing battle between online listing services and the real estate establishment. It hits all the good points--fear of disintermediation, the Justice Department lawsuit, the consumer demand for more information, and where agents' priorities really lie: At this week's conference in San Francisco, discussion veered between how to use the Internet to attract more customers and fear that more Americans would switch to flat-rate Internet brokerages. A typical audience question: "Can you tell us the future of commissions?" Switching to a flat-fee system with bonuses would remove the psychological pressure realtors exist under which forces them to push the sale at all costs (pun intended). If the majority of the free world can live within a salaried, non-commission paradigm, then the people associated with such a huge financial transaction can do the same. The comments are even more interesting, in fact. Check this out: Consumers are unfortunately getting a load of bad info from internet sites when doing their information gathering. Places like Zillow do not give accurate information on home values... Now, jump a few comments ahead: It's true that freely available information on the Internet concerning real estate, the few that there are, isn't totally accurate. But this is because of the stranglehold on the information by the realtor associations. If these types of accurate information that the realtors have are more widely available, then consumers can do some of the work themselves and the lucrative commissions that realtors currently enjoy will no longer be justifiable. There will always be a need for agents on both sides of the transaction, just as the work that goes into collecting and publishing these listings should be rewarded. But by unlocking the information troves of the MLS and enabling real-time accuracy of "guesstimate" sites like Zillow, it will force all of the players involved to bring their best game to the table. Agents will make more money by doing better work, buyers will spend less money to get the deal closed, and sellers will save money that currently goes into brokers' pockets. It's not a panacea, but it's a start. Information really DOES want to be free. :)