Spring Real Estate 2003

Publication Date: Wednesday, March 12, 2003

Net gains
Homebuyers are finding the homes of their dreams on the Internet

by Cheri Lucas

Sujata and Sandeep Verma hit the Internet before pounding the pavement when seeking their new home in Palo Alto.

"[My husband and I] were both working and had no time. Our agent was prompt with e-mails and followed up with listings daily," zipRealty.com client Sujata Verma said. The couple describes the online real estate experience as communicative, comfortable and "confidence-building."

Not even four years old, zipRealty puts the power and decision-making into the client's hands. This consumer-driven business, which is headquartered in the East Bay, has no local offices. Instead, zipAgents work out of their homes or virtual "zipMobiles," which alleviates overhead costs. The company provides a 1 percent rebate as well, which the Vermas found helpful for other purchases such as furniture. "If you're looking for a $700,000 property in Palo Alto, you could get up to $7,000 back," said Pat Lashinsky, vice president of marketing.

Online real estate is becoming a common alternative. In addition to full-service, Internet-based brokerages, such as zipRealty, other traditional real estate offices -- such as Prudential California Realty and Coldwell Banker -- have refined their Web sites, offering daily updated listing services.

First-time buyers, such as the Vermas, want an affordable house with a reputable school nearby. Combining e-mail and technology with the personalization of zipAgents, clients conveniently have the resources to educate them as well as the local expertise of agents, said Cait Wallace Neumeister, a zipAgent for Palo Alto, Mountain View, East Palo Alto, Los Altos, Menlo Park and Atherton.

According to a 2001 report of the National Association of Realtors, 80 percent of clients start their home search online. More than 30 percent of these Web searchers viewed the home they ultimately purchased during this initial search.
Real estate Web sites provide all properties listed in the Multiple Listing Service, or MLS, regardless of what brokerage has them listed.

"Prudential Realty uses tools to market extensively to clients who are commonly corporate and Internet-savvy," said Otto Gabriel of The Gabriel Team, a partner of Prudential California Realty based on Waverley Street in Palo Alto. The Gabriel Team consists of a husband-and-wife partnership that fuses a software and technology consulting background with traditional real estate expertise.

Clients sign up for PruWeb.com's Listing Watch, a search tool launched in October 2000, "which pulls listings matching specific criteria and sends automatic e-mails daily to clients," Gabriel said. "Palm Pilots, Web top interfaces, high technological services-it's the way we communicate now," he said.

Through Zip Notify, zipRealty.com downloads MLS twice a day, giving the homebuyer immediate access to potential homes, "from as broad as a zip code to as narrow as a [particular] street," said Lashinsky.

Newspapers offer advertisements, but not a full inventory of homes for sale, so contacting a real estate agent has previously been a homebuyer's best bet in gathering specific information. Today one can also view homes at www.silvar.org, the Web site of the Silicon Valley Association of Realtors.
However, traditional real estate agents based on the Peninsula agree that online-based real estate is not intended, despite its success, to replace traditional real estate sales.

Although the Web quickens the buying and selling process, "the Web and technology are only tools that open avenues. Some high-tech executives could use the Internet and completely bypass the agent," Magda Gabriel said.

"But when it comes to the negotiation, you'll never be able to replace that human interaction," her husband added. "You still need to build a personalized relationship with the agent, and a good agent isn't replaceable."

Down from 86 percent in 1995 and 80 percent in 1999, the traditional real estate agent was used in the buying process 79 percent of the time in 2001. "There is a certain amount of legwork that can be eliminated [with the use of the Web]," said Wallace Neumeister. "There's no waste of time. Before clients even speak to an agent, they can research neighborhoods, schools, and get loan information," she said.

With the advent of virtual tours on PruWeb.com or CaliforniaMoves.com, the Web site established in May 2002 by Coldwell Banker Northern California, consumers can view almost every angle of a house in the comfort of their own home.

Statistics compiled by the California Association of Realtors show that buyers and sellers in California use more technology than in any other part of the nation. "Prudential Realty measures hits to its site. California was an early adopter," said Ginny Cain, vice president, director of marketing of Prudential CA/NV/TX Realty. Many clients in Palo Alto are "younger first- or second-time buyers" who are computer-savvy, Neumeister said.

What is the future of Internet-based real estate? "The future of technology for Realtors does lie in wireless transmission," Cain said.

Complaints have been minimal about reliability of site information, the Gabriels said. "Sometimes sites are not updated, and clients may be eyeing a house that's already been sold," Magda Gabriel said. But with tools such as Prudential's one-year-old Web top, which is a "knowledge portal with real-time information," agents who embrace the technology will save hours of time for themselves and their clients. "Those not into the technology may not be as profitable. They'll lose market share and exposure," the Gabriels said.

An added bonus is cutting down on the never-ending paperwork, a complaint of clients of both the online and traditional agent. "With the electronic signature law passed last year in Congress, consumers can read and sign documents online, which saves hours of time," Lashinsky said.