The Internet Will Replace Realtors - The Fatal Flaw.....
Many of you remember the concern and controversy that came up several years ago when sites like Zillow and Redfin came on the real estate scene. They aren't very involved in our state but it still made local headline news.
Some people said, and still say, "the internet will replace Realtors" and "Real Estate Services will become a commodity."The theory was that people could appraise their home online and then buy and sell themselves, saving money by cutting real estate agents out of the equation.
This theory had a fatal flaw however,as Redfin discovered with its Internet Only approach to real estate. The real estate buying and selling process is often an emotional one, and is rarely "cut and dried".
While consumers like data and like to be able to research real estate and the market themselves online, they value relationships more. And, in the end, they turn to a Realtor (R) that they know and trust.
Redfin is a great example of this point, even during the recession, their user numbers continued to increase. However, they found that an increase in users did not necessarily translate into more paying customers. When people are ready to buy, they generally work with a Realtor(R).
So, in February of this year, Redfin announced a marketplace for agents with data-driven agent profiles. They will work to combine both data for consumers and the personal relationship of working with an agent.
While companies like Redfin and Zillow won't replace real estate agents, they do provide a valuable service in helping to educate consumers, and helping to make Realtors(R) better. The new scoring system that Redfin is creating will be an interesting study. Their goals are altruistic in trying to use data to benefit consumers and they have become a good resource for agents.
With all of the changes in the real estate and mortgage environment, using data to help all of us improve can only be a good thing.
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