4 Ways that Buying Real Estate has Changed in the Past Decade
Real estate is one of the older industries around, and it is not going to go away. But the Information Age and other factors are having surprising impacts on this old industry. If you have not been house hunting recently, you might be surprised at the changes.
Millennials are Reshaping the Industry
Generation Y is surpassing the Baby Boomer generation as the largest market segment, buying more new homes than any other group. This means change is afoot. This younger generation grew up with computers. They are children of the Information Age and it shows.
Business is beginning to move away from phone contacts and towards text and email. Millennials tend to do a lot of their own research before contacting an agent. Agents no longer control access to information. It can be found online and they are going there first, often taking a virtual home tour and making their own list of properties they would like to see before seeing an agent.
Real Estate Investor Software
Computers have forever changed the real estate industry. Software for investors is part of an overall trend towards a more information dense approach to doing real estate.
There are real estate investor software packages available that serve the needs of large investors with multiple hotels, or small operators who buy property, rehab it and flip it. Knowledge is power. In real estate, knowledge can be worth many thousands of dollars. Software is helping move real estate away from the tradition of seat of the pants, going with your gut decision making. It is becoming increasingly data driven. This is helping give investors more confidence in a high risk, high stakes game.
Home Warranty
In 1923, the influential Swiss-born architect Le Corbusier penned the idea that “A house is a machine for living in.” In the ninety-some-odd years since then, homes have only become more machine like. They have heating systems, cooling systems, ceiling fans, dishwashers and a whole host of gadgets attached to them, many of which did not even exist at the time he expressed his sentiment.
These many machines that we depend upon for living are one of the major contributing factors to increased house prices. When something goes wrong with them, it can rapidly get painfully expensive. Home warranties are the antidote to this issue. As home complexity trends upward, so does interest in home warranties at the time of purchase to make sure you do not get bit by hidden problems or unexpected turns of events.
Similar to an insurance product, this is a means to spend relatively little money up front and thereby protect yourself from being blindsided by large, unexpected bills that can crop up when one of the many moving parts of a house stops working properly. In most cases, they cost only a few hundred dollars per year, which breaks down to under a hundred dollars per month, assuming you get basic coverage. Obviously, more coverage costs more money.
As with any product, it pays to do your research ahead of time. You are much more likely to be satisfied with the product if know what features to look for in a contract and do some comparison shopping.
Things Have Sped Up
Coldwell Banker has looked at the last 10 years in real estate. One of their conclusions: Due to the influence of technology, homes sell faster. The speed of our modern technology is reducing the historically lengthy times involved in getting a house seen and going through the bidding process.
This is something to keep in mind if you have your heart set on a particular property. You may need to move quickly. It may not be there much longer. This may be counterintuitive given the many economic stressors in the world. This is the kind of thing historically associated with a hot market.
The real estate world has changed in recent years. If you are just getting back in the game, you have some homework to do. On the upside, much of that homework can be done online these days. You can do a great deal of looking around from either the comfort of home or on your favorite mobile device from almost anywhere with wifi.