Dealing With Consumer In 2015

Real Estate For 2015

Tech savvy home buyersThe first 3 months of 2015 appear to be much stronger for sellers of detached homes and townhouses in Greater Vancouver and Fraser Valley. The inventory of listings to-date is reported to be lower than similar period the past 3 years. Home prices are edging up due to strong demand from buyers. Multiple offers and quick sales were reported the past few weeks.

Dealing with consumer expectation

Things may change in the not too distant future due to changing market condition and new players entering the market.  The internet has a profound effect on consumer behaviour and how they do things today. They can pay bills online. They can transfer money online, book travel and check in their flight online. They can read reviews and make reservation online before walking into a restaurant.

But, in real estate the consumer continues to struggle with many issues that confront them when buying or selling their homes. Sellers were finding it difficult to sell their homes without using real estate agents, and pay a high price to do so. And, for buyers their only access to view the homes they are interested is to go through the agents. The process seems so inefficient compared to the cast changes happening with other services.

In the real estate business, the technology is there for us to create streamlined transparency and a better consumer experience.

The setback of high real estate prices

Consumers are faced with high real estate prices and the related cost of buying or selling their homes. Real estate commission is a contentious issue when the value of a real estate agent’s service is difficult to justify when a seller has to pay tens of thousands of dollars in real estate commission.

The doubling of home prices over the past 10 years effectively resulted in the real estate commission costing twice as much. Selling a $1.0 milion house is expected to cost a home seller close to $30,000 in real estate commission. For a buyer, purchasing a $1.0 million home will cost the buyer $18,000 Property Transfer Tax.

Sooner or later, a new player with the right business model and system will show up to disrupt the current business model. A drastically better and more efficient system will evolve to compete with the old business system. A system that may depend less on the real estate agents, but more on a system when information is more transparent and streamlined.

The process of buying and selling real estate will changed due to the advances in technology and streamlined services. As a result, sellers and buyers will benefit when their cost of buying and selling their homes come down significantly due to more efficient new players entering the market.

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