Internet Not Hurting Realtors - Sellers Sell For More

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Study: Internet not hurting Realtors
By Riddhi Trivedi-St. Clair

A new study by the National Association of Realtors shows that Internet use is on the rise among homebuyers and sellers. But online tools are enhancing the role of Realtors, not replacing them, according to the findings. Starting at a mere 2 percent in 1995, Internet usage has climbed steeply, especially in the past two years, to 74 percent in 2004 and 77 percent last year.

Nine out of 10 buyers in the study still used a real estate agent to assist in their home search. Among those who used the Internet, the percentage of people to use a Realtor is even higher than among those who didn’t. About 81 percent of buyers who went online later bought their home through an agent as compared with 63 percent of those who didn’t.

“The Internet doesn’t tell you to put a coat of paint on your door or to clean up your home,” said Tom Stevens, NAR president. “Those are things that come back many folds in terms of returns.” The Internet also doesn’t provide information about the market, neighborhood, schools and roads. That’s information that comes from experience and an understanding of the area.

“It is not like buying a commodity. It is a very complex transaction where you have to put everything into context,” said Brett Ellis, a Realtor with The Ellis Team, Re/MAX Realty Group. That doesn’t mean the Internet isn’t a powerful tool. According to the survey, 24 percent of homebuyers in 2005 found the home they purchased on the Internet. That is up from 15 percent in 2004 and only 2 percent in 1997.

Local Realtors are well aware of the power of the Internet. Most now have state-of-the-art Web sites that provide everything from photographs to 3-D tours of the home for sale. They also give information about the area, the neighborhood and the project. Buyers can access most of their documents online and almost all communication is done electronically. Many companies now even have systems that send a message to the Realtor’s cell phone from the Web site.

The Internet, however, doesn’t allow for a dialogue, said Tom Bringardener, general manager of Premier Properties. “The Internet is easy and convenient. People can do research on their own time-frame without the perceived pressures of having a sales person or having someone directing them to one area or another,” Bringardener said.

For sellers, having a Realtor provides access to a much wider market. When a seller lists a property with an agent, the home is accessible to everyone on the multiple listing service, or MLS. It is also marketed on reciprocal agent sites around the country and on the NAR Web site that lists 95 percent of the homes for sale nationwide.

Most Realtors, said Joseph Ballarino, a Realtor with Amerivest Realty, routinely get clients who first tried to buy or sell a home on their own and failed. Emir Jimenez, an Estero resident, is one of them. He was trying to sell his 1,500-square-foot, two-bedroom home in Estero for $300,000. He placed ads in the newspaper, but didn’t have access to online marketing. The community the home is in also didn’t allow him to put signs in the neighborhood. About 71 percent of buyers said they find homes for purchase from yard signs.

After three months, Jimenez caved in and took his listing to a Realtor last week. “I knew I would have access to way more buyers with a Realtor but I was trying to save the 6 percent commission,” he said. “I was being cheap is what it was.”

Ballarino said that on average, a seller gets more net money — even after paying the commission — when a real estate agent is used. The NAR survey validates his anecdotal evidence. Median home prices for sellers who use an agent is 16 percent higher than for homes sold by an owner.

The study findings were based on 7,800 responses out of 185,000 questionnaires mailed to people who bought or sold a home in the past year. “What it tells us is that today’s consumers, the ones that use the Internet, are very sophisticated,” Stevens said. “Sophisticated enough to do their homework and know that it’s a complex process and they need a professional.”

© 2006 Naples Daily News and NDN Productions. Published in Naples, Florida, USA by the E.W. Scripps Co.