 | This article has multiple issues. Please helpimprove it or discuss these issues on thetalk page.(Learn how and when to remove these messages) (Learn how and when to remove this message)
|
Areal estate trend is any consistent pattern or change in the general direction of thereal estate industry which, over the course of time, causes a statistically noticeable change. This phenomenon can be a result of the economy, a change inmortgage rates, consumer speculations, or other fundamental and non-fundamental reasons.
At one time, allreal estate brokers and agents, orRealtors, practiced "single agency", meaning they represented only the seller. In the 1990s, the concept ofbuyer agency became popular, allowing a buyer to retain an agent who would represent the best interests of the buyer alone. The first national company to provide this service was The Buyer's Agent, Inc.[citation needed] A 2008 study byConsumer Reports indicates that prior to this development, state law presumed that a Realtor represented the seller by default. The same study shows that buyers using buyer agents obtained a savings of $5000 in the price of the home as compared to prices paid by unrepresented buyers.[1] Unrepresented real estate buyers may still contact the seller’s agent directly to schedule property showings; this interaction does not establish agency representation unless disclosed and agreed upon in writing.[citation needed] In such cases, the buyer should be advised byagency disclosure laws (a state law in every state in the U.S.) that any information obtained, as well as all conversations and negotiations undertaken, will be for the benefit of the seller.
Historical rates are presented in a report by theGovernment Accountability Office, Congress's investigative arm. A 2005 study[2] of real estate commission rates, reported that realtors tended to charge, "about 5 percent to 7 percent of a property's selling price...". A 2007CBS News report suggested that an increase in the number of licensed real estate agents was placing downward pressure on commission rates.[3] Online marketplaces that allow agents to compete for listings have further pressured traditional commission structures.
Another trend is the emergence of alternatives to the commission model, includingflat-fee, hourly home selling, andFSBO tools. Some brokerages also offer hybrid models, combining limited flat-fee services with traditional representation.[citation needed]
TheInternet has become a majorlead generation method for real estate marketing, eclipsing local newspapers and all other sources as the consumer's most preferred method to learn about homes for sale. When the National Homebuying Survey was conducted in 1981, the most important rated information source in the home search, after agents, was newspaper ads. In 2020, 97% of homebuyers used the internet in their home search.[4] With social distancing and health guidelines coming from the COVID-19 pandemic, technology has played an even larger role in the buying and selling of homes according to a study by theNational Association of Realtors (NAR). The majority of real estate companies use popular internet marketing methods likeSEO, advertising, and social media.
Websites likeCraigslist (United States),Daft.ie (Republic of Ireland) andGumtree (UK) became in the 21st century the main sources for both buyers and sellers. Rapid changes in the market environment forced some countries to introduce new laws regulating real property market on the web.
Even with the introduction of the internet, traditional media and methods of generating leads were still an important part of Real Estate trend:
Though the internet was the most popular source, buyers also cited information from real-estate agents (85%), yard signs (62%), open houses (48%), and print or newspaper ads (47%). Fewer buyers relied on home books or magazines, home builders, television, billboards, and relocation companies.[5]
Mobile applications are also changing the way real estate agents conduct business.[6] Apps likeZillow,Trulia, Zumper, andRentberry are primarily accessed via mobile devices and have become very popular sources for listing properties for sale or rent. These applications function similarly to websites like Craigslist in that they allow agents or private sellers to list a property like they would in a classified ad albeit with a more dynamic display as well as mechanisms for users browsing a listing to contact the seller directly from the app. These platforms allow buyers to view homes in their desired area from anywhere.[7] Mobile applications are particularly prominent with millennial real estate customers.
TheUnited States Department of Justice Antitrust Division announced the launch of a new website in October 2007 to "educateconsumers and policymakers about the potential benefits that competition can bring to consumers of real estate brokerage services and the barriers that inhibit that competition."[8] Among other findings, they report that certain new sales models can reduce consumer home sales costs "by thousands of dollars. For example, in states that allow open competition, some buyer's brokers rebate up to two-thirds of theircommission to the customer, and some seller's brokers offer limited-service packages that let sellers list their homes on the localMultiple Listing Service (MLS) for as little as a few hundred dollars."[9] The Justice Department updated their information in a new website in 2016.[10]
Renting has recently been gaining popularity in the United States. This has become a more popular residential choice for younger generations due to student loan debt and more convenient locations. Some other pros for renting are amenities, flexibility, and credit building opportunities. The demand for rental units is increasing as there become more perks to renting.[11]
