How the internet is changing the real estate industry
Published on 18th February 2014
Like many industries, the internet is revolutionising the way homes are being sold and rented. Internet shopping for products and services is being driven by an ever-increasing internet-savvy consumer base, which has continued to embrace new, online technology. The internet has transformed the way we book our travel, shop for products, carry out our financial affairs, the way we interact with each other through social media and e-mail, the way we research topics of interest and even the 80% of us that now use the internet to check the weather. The real estate market has without doubt been a key beneficiary of internet growth over the last decade. A joint report by the National Association of Realtors in the US and Google found real estate related searches on Google.com grew 22 percent year on year in 2012
Agents have significantly increased the amount of information available on a home for sale or rent as they have embraced the internet in marketing their listings. According to the National Association of Realtors in the US 85 percent of Real Estate professionals believe internet marketing is important or very important in promoting their listings for sale or rent with only referral business ranking higher. In the same report 90 percent of home searchers now use the internet as an information source during their search – compare this with 53 percent yard sign, 45 percent open house or 18 percent home book or magazine and we get a building picture that house hunting is continuing to become more virtual.
There are several theories over why real estate search and real estate related websites have become a very fast growing sector of the technology world. Firstly it is time – like all internet shopping, the internet allows house-hunters to quickly search through the available housing stock in their desired area and price range and choose the properties that are of interest to view. They can easily do this whether sitting at home, during their lunch hour at work or with the increase in mobile internet – whilst they are travelling. Secondly is availability of information – the internet is expanding the information available to the house-hunter, more pictures than in a set of particulars, maps, videos and in increasingly highly competitive urbanisations, interactive floor-plans which virtually allow the internet user to walk through the entire house as though they were actually doing a viewing. Thirdly is Globalisation, the working population has never been more mobile or transient across different countries and continents, the internet allows them to find or search for a home before they move to a new jurisdiction. According to Knight Frank residential research in 2012, foreigners accounted for over half of London Property sales over GBP2m, as an agent your pool of potential buyers or renters could be from any corner of the world – only the internet provides you with a truly global reach.
The growth of property portals has accelerated the use of internet for both agents and house-hunters. Major portals such as Rightmove in the UK and Zillow in the US have given house-hunters unrivalled access to the available housing stock in their operating jurisdictions. Agents in turn use the portals to expand their internet presence above and beyond their own website at a relatively low cost. Portals in return enhance the internet presence and reach of participating agents. Most successful property portals will invest heavily in marketing strategies including Search Engine Optimisation, Social Media and also more conventional means. They also harness new technology through things such as mobile apps and enhanced search features that are at the forefront of online industry trends.
So how does this advance in online real estate presence impact participants in the market in Bermuda? Well firstly there are some excellent agent websites here on the island. Over the last year several agents have invested in new websites, several are in the process of upgrading their websites and many are adding new features such as map, videos and an easier search facility for PRC holders. As a buyer or renter the access to information is improving significantly and the market is becoming far more transparent. As a seller or landlord it is becoming more important that you take advantage of this growing trend for internet search and pick an agent who has an online marketing strategy in terms of their own high quality website and also ensure that they feed their listings onto relevant property portals. An increased online reach by your agent will compliment their other marketing strategies, industry contacts and database of potential clients to ensure your property gets the maximum exposure in the current market.
This week's column is submitted by Peter Goodall, director of propertyskipper.com. Propertyskipper.com is a Bermuda-based online property portal.