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 Internet and Online

Real Estate Investing : Real Estate Education Last Updated: May 14th, 2012 - 22:24:01

Real Estate Transaction Who’s in control?

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Technology, particularly Internet lead companies, has changed the real estate agent’s relationship with the consumer. Where they find leads, how they manage them and the virtual nature of the early relationship is significantly different than the past.

But the changing nature of those relationships has more to do with where the agent gets the lead than it does with reducing the importance of the agent. The Web, for example, has minimized the role of the newspaper and enhanced the virtual nature of the contact in the early weeks.

But that relationship has not been altered much once the lead is in the hands of the agent, who continues to be the commander of the transaction post-Web lead to closing. The consumer’s high touch, emotional dependency for the agent continues to be important once the handoff occurs.

Hyper-market conditions and inflating home values may increase this dependency and could subside once better self-reliant tools are developed on the Web and the housing market cools.

Agents have invested more than brokers and franchises to capture those leads, and have become the primary source of income for most lead generation companies, including HomeStore.

One way to think about the real estate transaction is front-end and back-end. Innovation is occurring on both fronts, with the Web on the front-end and bundled services and capture programs on the back-end.

Theoretically, the agent might get squeezed from these two ends and become less relevant. But, so far that has not occurred.

Consumer-direct lender channels have not squeezed out the agent. They have generally been more successful with refinancing. Ultimately, the agent’s referral is the most important consideration for most home purchasers. The blending of homes and loans on the Web may change that.

Title companies in partnership with lenders and brokers are driving success on the back-end in the form of bundling. Agents are absent from this discussion.

Bundling has not changed the customer relationship yet, though it may give real estate brokers and some lenders a better capture rate on the loan and title business. Currently, the agent drives most of these decisions.


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