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Real Estate Technology: Importance & Benefits

Real Estate Technology: Importance & Benefits
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  • 0:01 Use of Technology in…
  • 0:32 Data Sharing in Real Estate
  • 2:18 Online Leads
  • 3:07 Signing on the Electronic Line
  • 5:09 Lesson Summary
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Lesson Transcript
Instructor: Racquel Fulton
As technology advances and new policies are enacted, the real estate industry adjusts to keep pace. In this lesson, learn how technology is used to benefit buyers, sellers, renters, and real estate professionals.

Use of Technology in Real Estate

Brian got a new job. He's relocating to a new city and wants to buy a home close to his new workplace. Before contacting a real estate agent, Brian grabs his mobile phone and begins an Internet search. Within seconds a list of home sale advertisements appear on the screen. Brian can compare prices, view pictures, and take virtual tours of real property for sale. All of this information is available to him due to advancements in technology and the new policies which regulate digital information in the real estate field.

Data Sharing in Real Estate

Prior to the mid-nineteen-nineties, the only way Brian would have been able to view listings of homes for sale would be by reading ads in a newspaper or stopping by the office of a real estate agent. Access to real estate listings was within a closed data network. Closed data is information only available to authorized users. Real estate professionals use a closed data network called the Multiple Listing Service (MLS). The MLS is a private network in which agents and brokers share real estate listings with each other. The MLS is controlled by the National Association of Realtors (NAR).

To meet the needs of customers like Brian, NAR created the Internet Data Exchange (IDX) policy. The policy allows its members to share listings outside of their network. Data from the MLS is shared with approved online real property advertisers such as Zillow and Trulia. These companies have developed innovative ways to distribute data about homes and land for sale or rent. Internet users can access their databases through applications on their personal computers or smartphones.

To enhance the user experience and to make home advertising more effective, companies such as Zillow and Trulia also combine the closed data from the MLS with open data. In real estate, open data refers to information available to the public about different geographical areas from federal, state, and local governments. When Brian searches home listings, he can also view data regarding the neighborhoods each property is located in. Combining open data about nearby schools, businesses, crime statistics, and local demographics (such as the median income of area residents) give home buyers, renters and sellers a broad overview and helps them make informed decisions.

Online Leads

Based on his Internet search, Brian selects a home for sale that he would like to view in person. He fills out an online form to contact the listing real estate agent for the property. The form that Brian completes is called a lead generator. In real estate, a lead refers to a person expressing interest in making a property purchase. Real estate professionals traditionally relied on leads generated from word of mouth, print ads, and mailing lists. Today, professionals can generate leads through digital ads and social media platforms.

The information Brian enters and submits online is automatically compiled and sent via email to Karen, a real estate agent in the new city. Karen uses ads posted on social media sites, Internet applications, and email to automate her business. According to NAR, email is currently utilized by 90% of real estate agents.

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