Rajhev Rajkumar
15 September 2006
opinion
Johannesburg — TECHNOLOGY is massively transforming how Americans buy and sell homes -- underlining a global trend that is becoming increasingly apparent in SA too.
A study undertaken by the National Association of Realtors in the US, one of the largest surveys of real estate consumers ever conducted, indicated that use of the internet to search for a home has 'risen dramatically'.
In the US, use of the internet to search for a home has risen spectacularly over time, increasing from only 2% of buyers in 1995 to 74% in 2004 and 77% last year.
The report gives a strong indication of just how important the internet has become in the property market and is certainly a harbinger of what to expect in SA.
While no similar survey has been conducted in SA, it is clear from the growth in volume of listings that we are on the same path. For example, in the last month alone PropertyGenie.co.za experienced 21% growth in listings.
The agents we deal with have also reported that more and more sellers are asking for internet listings and they have come to expect it as a standard part of an estate agent's marketing offering.
With reference to the survey, when asked where they first learned about the home purchased, 24% of buyers identified the internet, up strongly from 15% in 2004 and only 2% in 1997. Although most buyers use an agent to complete the transaction, 36% first learn about the home they buy from an estate agent and 15% from yard signs; five other categories were 7% or less.
The real estate industry in SA today is changing quickly. Although people still need to do the footwork looking at houses, many are finding property related websites a good starting point and an invaluable aid in the screening process.
Many websites are investing a lot of time and money in building information technology, and because of these efforts, more consumers than ever are using the internet in their home search.
Buyers who use the internet in searching for a home are more likely to use a real estate agent than non-internet users. Consumers rely on professionals to provide context, negotiate the transaction and help with the paperwork.
It counters predictions a decade ago that the internet would 'disintermediate' estate agents. In reality it has helped agents reach a much wider audience because selling property is not like selling a book or an airline ticket.
It is a far more complicated process, it needs a professional to point out some of the subtleties and factors that a lay buyer might not be aware of.
The research also showed that the typical buyer walked through nine properties, searched eight weeks to buy a home and moved 20km from their previous residence in their search.
In finding an estate agent, 44% of buyers were referred by a friend, neighbour or relative, 11% used an agent from a previous transaction, 7% found an agent on the Internet, 7% met at an open house and 6% saw contact information on a "for sale" sign.
Rajhev Rajkumar is general manager of PropertyGenie.co.za.
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