Why Real Estate Agents Have Good Reason To Fear The Web

from the marginally-useful dept

There have been a number of stories lately about real estate professionals lashing out against online real estate services like Zillow and RedFin, which are seen as threats to their traditional business. A new study done by two economics professors sheds some light on why they might be feeling embattled. In an examination of the housing market in Madison, Wisc., the pair found that homes sold using brokers did not fetch sellers any additional profits after commissions were taken out. What makes Madison interesting is that it has a thriving website of for-sale-by-owner homes, so sellers there don't have to do much legwork if they want to sell on their own. This means that real estate agents may still add value in communities where such services aren't popular, but it's value that could disappear as services like RedFin startt to take hold. Thus the agents' fear seems to have a legitimate basis, and their behavior conforms nicely to the rent-seeking tactics exemplified by similarly organized professional groups.

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  1. identicon
    Suzi Gravenstuk, 2 Jan 2008 @ 3:24pm

    Re: Re: Real Estate and the web!

    We charge because we are charged. The MLS is not free to REALTORS! First, you pay your dues through education, licensing, and errors and ommissions coverage. Second, many MLS's require membership in NAR (being a REALTOR). NAR dues for my area run about $400 annually (includes National, State and Local Association of REALTORS). As a broker, I paid a $500 set up fee and $60 a month. It is not Just for Active listings we pay for, though. Research and statistical analysis by any criteria we choose is valuable, including analyzing closed properties. Thank you very much:-)

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