Ten years ago, a search for real estate would have started in the office of an area real estate agent or by just driving around town. Ambergris Caye Real Estate At the agent’s office, you would spend an afternoon flipping through pages of active property listings from the neighborhood MLS (MLS). After choosing properties of interest, you would spend weeks touring each property and soon you found the correct one. Finding market data to help you assess the asking price would take more time and a lot more driving, and you still is probably not able to find all of the information you had a need to get really comfortable with a fair market value.
Today, most property searches start the Internet. An instant keyword search on Google by location will likely get you a large number of results. If you spot a property of interest on a real estate web site, it is possible to typically view photos online and maybe even take a virtual tour. You can then check other Web sites, such as the local county assessor, to obtain an idea of the property’s value, see what the existing owner paid for the property, check the true estate taxes, get census data, school information, and also check out what shops are within walking distance-all without leaving your house!
While the resources on the net are convenient and helpful, with them properly can be a challenge because of the level of information and the issue in verifying its accuracy. At the time of writing, a search of “Denver property” returned 2,670,000 Sites. Even a neighborhood specific search for real estate can easily return thousands of Internet sites. With so many resources online how 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 simpler to understand online property information and strategies.
The Business of Real Estate
Real estate is typically bought and sold either through a licensed agent or directly by the owner. The vast majority is purchased and sold through real estate brokers. (We use “agent” and “broker” to refer to the same professional.) This is due to their real estate knowledge and experience and, at least historically, their exclusive access to a database of active properties on the market. Usage of this database of property listings provided 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 commonly referred to as a multiple listing service (MLS). Generally, only properties listed by member real estate agents can be added to an MLS. The primary reason for an MLS would be to enable the member realtors to make offers of compensation to other member agents should they find a buyer for a house.
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 lots of 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 similar to an MLS however the agents adding the listings to the database are not required to offer any specific type of compensation to the other members. Compensation is negotiated outside the CIE.
In many instances, for-sale-by-owner properties cannot be directly put into an MLS and CIE, which are usually maintained by REALTOR associations. Having less a managed centralized database can make these properties more difficult to locate. Traditionally, these properties are located by driving around or searching for ads in the neighborhood newspaper’s real estate listings. A more efficient solution to locate for-sale-by-owner properties is to search for a for-sale-by-owner Site in the geographic area.