There are some interesting real estate related apps hitting the market, all with the intention of capturing the consumer in the house hunting process before he or she connects with a real estate agent. The buzz on these apps ends with the closing line “And of course we will offer to connect you with a real estate agent.”
The applications are free. Which begs the question “How does the app generate income?” Millions of dollars are paid to third party sites by agents purchasing ad space to encourage potential buyers and sellers to contact them personally. Zillow and Trulia (and the other third party sites that offer listings featured in multiple listing services) post listings through access to various multiple listing databases. They take a brokerage firm’s listing and post the listing on their site. If the brokerage firm or agent want to provide the best service for their client, as in connecting an interested prospect with the agent who is best able to answer questions about the property, they pay the third party site a fee for ‘enhanced status’. Yep, I’m as lost as you are in the maze of how this works. And we’re not even talking about apps yet…how do they make money? And what does an App know about the block by block differences in any neighborhood? Or, how does it know if the kitchen was renovated? There’s renovated…and then there’s renovated…quality and style are a visual attraction.
There are some great apps out there for consumers and agents, and there are plenty of sites that offer reliable and timely market data to both consumers and realtors. But even the most sophisticated algorithm cannot replace an experienced agent who knows every nuance of a neighborhood and how those nuances translate to positive or negative impact on the value of a home. We Realtors experience our communities every day and can quickly assess the organic changes that take place block by block. Knowing a community at this intimate level, and understanding the fine art of negotiating, are key to advocating for a client; ensuring a timely, effective, competitive and overall successful real estate transaction. Computers are limited by formulas and unable to take into account the subjective elements of the housing industry, and I’ll go head to head with an app in a negotiation any day of the week!