10 years ago, a search for real estate could have started at the office of an area real estate agent or just by driving around town. At the agent’s office, you’d spend an afternoon flipping through pages of active property listings from the local Multiple Listing Service (MLS). After choosing properties of interest, you’d spend many weeks touring each property and soon you found the right one. Finding market data to enable you to measure the price tag would take additional time and a lot more driving, and you still might not have the ability to find all the information you needed to obtain really more comfortable with a good market value.
Today, most property searches begin the Internet. A fast keyword search on Google by location will likely enable you to get tens and thousands of results. In the event that you spot a house of interest on a real estate website, you are able to typically view photos online and maybe even take a virtual tour. You can then check other The websites, such as the local county assessor, to obtain a notion of the property’s value, see what the existing owner paid for the property, check the real estate taxes, get census data, school information, Tarporley estate agents and even check out what shops are within walking distance-all without leaving your house!
As the resources on the Internet are convenient and helpful, with them properly can be a challenge due to the level of information and the difficulty in verifying its accuracy. During the time of writing, a search of “Denver real estate ” returned 2,670,000 Web sites. Even a town specific look for real estate can very quickly return tens and thousands of Web sites. With so many resources online how can an investor effectively utilize them without getting bogged down or winding up with incomplete or bad information? Believe it or not, understanding how the business enterprise of real estate works offline makes it easier to understand online real estate information and strategies.
The Business of Real Estate
Real estate is typically bought and sold either by way of a licensed real estate agent or directly by the owner. The great majority is bought and sold through real estate brokers. (We use “agent” and “broker” to refer to the same professional.) That is for their real estate knowledge and experience and, at least historically, their exclusive access to a database of active properties for sale. Access to the database of property listings provided the most efficient way to search for properties.
The MLS (and CIE)
The database of residential, land, and smaller income producing properties (including some commercial properties) is commonly called a multiple listing service (MLS). Generally, only properties listed by member real estate agents could be put into an MLS. The primary purpose of an MLS is to enable the member real estate agents to produce offers of compensation to other member agents if they find a consumer for a property.
This purposes did not include enabling the direct publishing of the MLS information to the general public; times change. Today, most MLS information is directly accessible to the general public within the Internet in a variety of forms.
Commercial property listings will also be displayed online but aggregated commercial property information is more elusive. Larger MLSs often operate a commercial information exchange (CIE). A CIE is comparable to an MLS nevertheless the agents adding the listings to the database are not required to offer any specific type of compensation to another members. Compensation is negotiated away from CIE.