I think that several technologies are providing transparency in RE.
1. Zillow. For the first time, the public has sale history information. Most people previously did not know that sale history was public record. Now they can view that information and that causes them to dig deeper. Now that flipper profits are out in the open, buyers are becoming resistant to becoming the GF.
Zillow opened up a can a worms. Now that buyers have information, they tend to require for more answers to their questions.
2. Craigslist. Prior to Craigslist it was more difficult to find a rental. For individual rentals, you had to buy the newspaper and waste your time calling landlords, or you had to hire and agent to find a rental for you. Either that , or pay inflated prices to live in an apartment complex.
With Craigslist you can more effectively find a rental by looking at pictures and through email.
Rental prices are also more transparent. I believe this will hold down the pricing power of the large apartment complexes.
Nearly all sales are still made through the MLS but that will change (very slowly) over time.
3. Blogs. Blogs are a great way to share information prior to buying. Buyers can gain tremendous knowledge about certain neighborhoods and the state of the general market before they buy.
4. Zip Realty. I believe that Zip Realty is the first online service that allows you to search properties without trying to refer you to an agent (because they have their own low commission agents). That allows buyers to search to their hearts’ content, in the confort of their homes, without sales pressure.
In short, before web services, Real Estate was hit and miss. Buyers relied on friends and family and word of mouth and most importantly on the Realtor whose primary motivation is to close a deal. Now, the Realtor is becoming less instrumental in transactions.
Knowledge is power and tech is delivering that knowledge to potential buyers and sellers.
More transparency in RE will hold prices down. It’ll be interesting, in a few years, to look at studies on the affect of web services on RE.
