There are so many websites out there, I sometimes wonder how any of them can make money. But in this case, I hope they are successful at pushing some cost cuts through the real estate industry. That industry is long overdue for some consumer-friendly changes, especially in fees and the structure of the MLS system.
Google, Craigslist Expand Into Real Estate
With Listings From Owners As Well as Agents, Sites May Weaken Realtors' Hold
April 6, 2006
Craigslist.com and Google.com, two Web sites that have fundamentally altered the way consumers buy a broad range of products, are emerging as places to shop for residential real estate, a development that in the long term could weaken Realtors' hold on home selling.
Listings of real estate for sale on Craigslist, a popular Web site featuring free classified ads, rose to 335,126 in March, more than triple the level of a year earlier. Google Inc., meanwhile, is testing a tool to help users sort through listings of homes for sale. Several more specialized sites launched in the past year -- including Trulia.com, Oodle.com and Propsmart.com -- offer free access to substantial numbers of listings.
While their real-estate ventures are still relatively small, sites like Google and Craigslist have begun reshaping the advertising world as they offer a potent alternative to ad spending on traditional media such as newspapers and TV. Craigslist in particular has become a popular place to post classified listings for rental apartments, child care, jobs, furniture and personals. With household brand names and huge numbers of users -- Google had 89 million visitors in February, according to research firm NetRatings Inc. -- Google and Craigslist have the potential to draw large numbers of home-sale listings.
The proliferation of real-estate sites comes as brokers are under pressure from several directions. As home sales slow, an increasing number of discount brokers are vying for customers. In addition, the U.S. Justice Department and the Federal Trade Commission are investigating industry practices that they say deter competition.
Commissions on home sales have declined slightly over the past decade and now average around 5.1%, according to estimates from Real Trends, an industry publication.
