Ten years ago, a search for real estate would have started in the office of a local real estate agent or by just driving around town. Real Estate Agent At the agent’s office, you would spend an afternoon flipping through pages of active property listings from the local Multiple Listing Service (MLS). After choosing properties of interest, you’ll spend weeks touring each property until you found the correct one. Finding market data to enable you to assess the asking price would take more time and much more driving, and you still may not be able to find each of the information you had a need to get really comfortable with a fair market value.
Today, most property searches start the Internet. A quick keyword explore Google by location will probably get you a large number of results. If you spot a house of interest on a real estate web site, it is possible to typically view photos online and maybe even have a virtual tour. You can then check other Web sites, such as the local county assessor, to get a concept of the property’s value, see what the current owner paid for the house, check the real estate taxes, get census data, school information, and also have a look at what shops are within walking distance-all without leaving your home!
While the resources on the web are convenient and helpful, with them properly could be a challenge because of the level of information and the difficulty in verifying its accuracy. During writing, a search of “Denver real estate” returned 2,670,000 Internet sites. Even a neighborhood specific search for real estate can simply return thousands of Sites. With so many resources online so how exactly does 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 property information and strategies.
The Business of Real Estate
Real estate is normally bought and sold either by way of a licensed agent or directly by the dog owner. The vast majority is bought and sold through real estate agents. (We use “agent” and “broker” to refer to the same professional.) That is due to their real estate knowledge and experience and, at least historically, their exclusive usage of a database of active properties on the market. Usage of this database of property listings provided probably the most efficient way to seek out properties.
The MLS (and CIE)
The database of residential, land, and smaller income producing properties (including some commercial properties) is often referred to as a multiple listing service (MLS). Typically, only properties listed by member realtors can be added to an MLS. The primary purpose of an MLS would be to enable the member real estate agents to create offers of compensation to other member agents if they find a buyer for a property.
This purposes didn’t 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 over the Internet in many different forms.
Commercial property listings may 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 but the agents adding the listings to the database are not required to offer any specific type of compensation to another members. Compensation is negotiated beyond your CIE.
Generally, for-sale-by-owner properties can’t be directly added to an MLS and CIE, which are usually maintained by REALTOR associations. Having less a managed centralized database could make these properties more difficult to locate. Traditionally, these properties are found by driving around or looking for ads in the local newspaper’s real estate listings. A far more efficient way to locate for-sale-by-owner properties is to search for a for-sale-by-owner Internet site in the geographic area.