So many changes in the real estate industry, globally, as a result of the true impact of the Internet Age: it's now a consumer centric business model, no matter the type of business involved.
It was evident much earlier in the car industry, the travel industry, and in the stock market side of investment. These businesses were completely changed by the impact of the Internet.
Real Estate, as an industry, was late to the table of change, then.
In Canada, CREA (Canadian Real Estate Association) which manages the MLS system, has been involved in a law suit brought by an Ottawa realty company. They had wanted to use some of the marketing changes offered by the Internet, and had been stopped from doing so, by CREA. This company sued, then, under the Competition Act, and their complaint revolved around the control by CREA of real estate in Canada. Their suit was simply that this control hampered the freedom of the consumer to choose models of real estate. After this lengthy time period, the Competition Bureau found in favour of the Ottawa company and against CREA. There will be appeals, of course. Apparently, the current head of the Competition Bureau also felt that the original suit did not go far enough, and would apparently want to see more changes as to how real estate is offered to the consumer.
We will all be hearing more about this, in the weeks and months to come, as it does go to the heart of how real estate has been practiced in Canada. Immediately, there is more opportunity for a seller, and the control of real estate information, via the MLS system, is altered. Once a door is opened, of course, it's not just some things that burst through, but "everything".
Realtors have known for some time that things are not "as usual". Again, it's because the consumer is discovering information in places that are aside from the traditional ways of marketing.
The recent economic downturn (fully in place by Fall, 2008, but actually softly underway since 2006) may have exacerbated the issues of change, but it would have come in any event. Economics always pushes societal change at a speedier rate, but the change was underway, anyway.
The Internet erased time, geography, gender, age, race...it is about information sharing. As Marshall McLuhan noted, back in the 1960s/70s, the "mediium is the message", and he alerted us that in the "global village" we would be changed in all venues of life, including business processes.
The consumer is now in control. Before 1976 (the year that Dave Liniger and his wife began Re/Max, as a real estate business model), it was a company that was in control of a real estate process. After 1976, it became an agent centric business model in real estate, and Century 21, Sutton, Prudential, Coldwell-Banker, NRS/Block Bros, Royal Lepage, etc., followed the format introduced by Re/Max. More recently, Sotheby's, 1% Realty, and MacDonald Realty (all franchise models, based on that agent-centric former model) had come to the fore, too.
Post internet, though, it has become a consumer centric business model. This shift is profound. Buyers can find out everything on the internet that used to be the province of the realtor, and do not have to contact a realtor at the beginning of their search process. Sellers, with a loosening of a realtor control of the MLS system, can also choose to act more on their own behalf. Completely new models, such as RedFin, return half the commission earned by their company format, paid by the seller of course, to the buyer. Now there's a true consumer-centric model!
It took the car industry, the travel industry, the stock market investment industry about three years of shift to become totally different...or, they were out of business. Things continue to speed up, in execution, now that we are more entrenched in the "real" 21st Century. Perhaps within 2 years, we won't recognize the terrain of the real estate industry.
It's not biz as usual for anyone, already -- not for the company, the realtor, or the consumer. The consumer is in control. For a realtor, this means a totally different method of marketing from what "worked" even three years ago! Some companies, and businesses that are affiliated with real estate marketing, will disappear. Others will come into being.
Both scary, then, and exciting...opportunity is everywhere, but it's "different".
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