Homebuyers and sellers are almost neck-to-neck when it comes to conducting online research before entering residential real estate transactions, according to a recently released report by the state Realtors association.
Real estate professionals in San Diego County, however, see a wide discrepancy here between buyers' and sellers' Internet research.
In separate statewide surveys conducted a few months apart this year, the California Association of Realtors (CAR) found that in January, 56 percent of buyers and 47 percent of sellers reported the Internet played an important part of the selection, buying and selling process (see graphs below). This was the closest the two groups have been. In 2002, 41 percent of buyers agreed the Internet played a strong role in the transaction, compared to 9 percent of sellers.
In 2003, 45 percent of buyers and 12 percent of sellers went online for information, according to CAR surveys.
The CAR survey also showed that sometime late in the second quarter of 2003, the number of homebuyers using the traditional methods crossed paths with the number of buyers using the Internet. Traditional homebuyers have been in a steady decline and Internet homebuyers on the rise and now, in 2004, Internet homebuyers are in the majority at 56 percent.
Buyers use the Internet as a prelude and to "window shop," reports a recent National Association of Realtors (NAR) survey, according to Lorrie Mowat, communications director for San Diego Association of Realtors (SDAR).
When buyers are ready to actually do something, the NAR reports, they turn to agents.
Going online is less personal for many potential buyers, according to Amy Wilson, a Realtor with Century 21 Award in Del Mar. Some buyers feel a little intimidated about walking into a real estate agent's office, especially in the preliminary search stage, she said. "Buyers are just very proactive in their searches," Wilson said. "They're online looking for open houses, properties. (Then) 'Hey, I found this -- what's the scoop on this, what's the scoop on that?'"
Buyers use the Internet for efficiency, according to Kathleen Nguyen, a broker with Lifetime Real Estate in Poway. "You want to get the answers right away," she said. "When you want the answers, you want them now."
Online research can yield photographs of homes, both inside and outside. There also is information about homeowner association fees, the number of bedrooms and bathrooms. First-time homebuyers and the younger generation, especially, use the Internet prior to entering real estate transactions, she said.
On the positive side, it shortens the time Realtors have to spend showing clients properties. Buyers are more educated and know what they want. They feel more in control.
On the other hand, sometimes buyers think they know more than they really do, Nguyen said. The Internet provides a lot of information, but doesn't always show the big picture.
One of the biggest problems is misinformation about mortgages, she said. Many buyers, who've gone online, believe they can qualify for 100 percent financing regardless of their credit history, earnings and assets.
Nguyen said it's fair for buyers who've done a lot of the legwork to ask for a rebate. "It doesn't hurt you in any way," she said. "Because of that, you have more time to help other clients." A rebate is 1 percent of the agent's commission, she said.
Rose-Anne Wood, president of the East San Diego County Association of Realtors, and a Realtor with a Prudential California Realty office in La Mesa, said about 90 percent of buyers use the Internet before contacting her. Sellers, who may be looking for a move-up property or who want to see what properties are selling for in their area, may go online. Wood estimated about 50 percent of sellers she represents use the Internet before the transaction.
Wood, who has one Web site, is having seven more put up. "People find you online," she said.
Kara Horat, a Realtor and partner with her husband, Larry, at Horat & Horat Real Estate Professionals Inc. in Carmel Valley, said her company has two Web sites -- both user friendly.
"I think it's a great tool for real estate professionals and I think it's a great tool for consumers," she said. "They still need a personal relationship, they still need an agent to guide them through the process. There's a lot of legal aspects with buying or selling a house -- that's where a professional comes in."
Buyer online research doesn't eliminate any of her work, Horat said, it just educates the consumer. Someone not checking the market on the Internet may want to buy a three-bedroom condominium in Mission Hills -- for $200,000 -- on a certain income. "It's not going to happen," she said.
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