Buyers of real estate today are taking their searches and their methods to entirely new levels, thanks to the Internet.  Buyers want access to instant information that is free, and they do not want the kind of uncomfortable confrontation that occurs when they have to pick up the phone and call a salesman.

I believe there are two powerful reasons for this change.  First, the Internet has given consumers the ability to search the multiple listing service in their target markets at no cost anytime of the day or night.  When I first started in real estate before the Internet, I had an MLS book that was published every Friday with all the listings in it.  People had to actually come into the office and sit down with me while we thumbed through this two-inch thick book.  Now, buyers can jump on the Internet from the comfort of their homes and search the MLS without even talking to a real estate agent.  They like that.

Second, there is a cultural shift occurring that is fueled by consumers.  Technology has facilitated consumers’ desires to move away from traditional high pressure sales and from traditional advertising.  Buyers do not like being force fed news and advertising without choice.  They don’t like being told what to do.  Consumers want to have the power to decide what they look for, who they talk to (or don’t talk to), and who they do business with.  And they want to be able to come and go as they gather information without being hindered.  The advent of the Internet and the explosive growth of technology on the Internet to facilitate consumers is a Godsend for the majority of Americans.

Even the news that consumers are reading is part of this cultural change.  They are shifting from print newspapers to the Internet at the speed of light, and they are loving the fact that they get to choose what news to read.  A fascinating study by the Pew Research Center’s Project for Excellence in Journalism examined what news consumers are reading when they have a choice:

The question of whether citizens define the news differently than professionals is becoming increasingly relevant. It started with offering visitors a sense of what others found interesting: what news stories were most emailed and most viewed?

Soon, establishment news sites like CBSNews.com allowed users to make their own newscasts. Then, names like Digg, Reddit and Del.icio.us emerged as virtual town squares that became a way to measure the pulse of what the web community finds most newsworthy, most captivating, or just amusing. The trend continues, as even Myspace, the social networking site popular among 20-somethings, has launched a news page (http://news.myspace.com).

Some key findings include:

• The news agenda of the three user-sites that week was markedly different from that of the mainstream press. Many of the stories users selected did not appear anywhere among the top stories in the mainstream media coverage studied. And there was often little in the way of follow-up. Most stories on the user-news sites appeared only once, never to be repeated again in the week we studied.

• The sources user news sites draw on are strikingly different from the mainstream media. Seven in ten stories on the user sites come either from blogs or Web sites such as YouTube and WebMd that do not focus mostly on news.

• The three user news sites differed from one another in subtle ways. Reddit was the most likely to focus on political events from Washington, such as coverage of Vice President Cheney; Digg was particularly focused on the release of Apple’s new iPhone; Del.icio.us had the most fragmented mix of stories and the least overlap with the News Index.

• On Yahoo News—even when picking from a limited list of stories Yahoo editors had already pared down—users’ top stories only rarely matched those of the news professionals.

Consumers are taking control of what and how they gather information.  That is true with the news and the advertising they choose to read, or ignore, and it is true today about how they search for and buy real estate.

Home buyers can search a beautiful map based multiple listing service (see example of an MLS search that is easy to navigate and graphically pleasing), they can search the locale of interest with a Google search to find for-sale-by-owners, to find an exclusive buyer’s agent, to read local real estate blogs, and view photos of the area.  They can do all of this from the comfort of their home without talking to a single salesman.

The vast majority of buyers are not using real estate portals either.  Buyers are no longer pulled by the big names of real estate companies branded on billboards or on TV commercials.  The dominant branding of big names that was such a major factor in the 60’s, 70’s, and 80’s has faded just as the Internet has grown.  Consumer loyalty is no longer to the “branded companies.”  Consumers are loyal to themselves, and that is the way it should be.  Technology has finally given the consumer what they have always wanted–the power to choose.  They choose the information they view, how and when they view it, and they choose what to do with that information without interference from anyone.

Buyers are taking control, and they love it.

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Print newspapers are losing readers to the Internet, and there is a ongoing debate about how many years newspapers can last.  The Internet is taking over their business in news and advertising.

“After a century of continuous publication, The Christian Science Monitor will abandon its weekday print edition and appear online only, its publisher announced Tuesday. The cost-cutting measure makes The Monitor the first national newspaper to largely give up on print. . . . John Yemma, The Monitor’s editor, said that moving to a Web focus will mean it can keep its eight foreign bureaus open. We have the luxury — the opportunity — of making a leap that most newspapers will have to make in the next five years,” Mr. Yemma said. [Source: Paper to End Daily Edition]

Web 2.0 is a popular term used to describe the new ways people interact on the Internet.  New technology is finding new applications as the costs and methods of selling intersects with consumer demands. This sea change is accelerating a decade old trend.  Consumers are losing interest in paying for newspapers, and they’re moving to the Internet.

Newspapers exist to make a profit, the goal of all profit corporations.  Subscription fees and advertising are their primary sources of income.  The overwhelming problem newspaper publishers face is that subscriptions are dropping as people can easily get their news free on the Internet 24/7, and businesses are cutting expensive advertising from their budgets because they cannot afford it, and because it is no longer producing results.

Many newspapers have created an Internet version of their papers, but for most that has been a disaster.  For traditional print media there has been a huge disconnect between the printing presses that operate with gears and ink and the Internet that cannot be mapped on Google.  Many publishers and editors have attempted to use blunt tools to traverse the chasm between printing presses and the virtual world of the Internet.  Many are failing, and the current recession is the catalyst of their doom.

Even Microsoft, which moves very slowly, and only takes on new markets when others have already mapped the way, has been forced to reconsider its strategies involving the Internet.  Remember it was Microsoft that refused to admit that Internet browsers were the way of the future, and after Netscape mapped out a large virtual presence, Internet Explorer was born of necessity and became a major MS priority.  And after years of refusing to admit that the world will move away from expensive PC software, Microsoft finally capitulated and with some fanfare recently announced their grand plans to pursue cloud computing with Azure.  Can there be any doubt the Internet is capturing vast territories?

“. . . with the rapid movement of dollars to the online space, [Paul] Martino [CEO of Aggregate Knowledge] believes it’s just a matter of time before online advertising dollars will overtake traditional media.”  View article about online advertising.

“The latest Pew survey reinforces some of the key media chattering-class talking points for the past couple of years: Newspaper readership is declining, young people prefer their news from the Internet, . . . It’s definitely cutting into the time of print newspapers, which continue to hemorrhage readers to the advantage of online news”  View article from Technews World.  Another Pew study during the presidential election concluded:

Many more Americans are turning to the internet for campaign news this year as the web becomes a key source of election news. Television remains the dominant source, but the percent who say they get most of their campaign news from the internet has tripled since October 2004 (from 10% then to 33% now).

While use of the web has seen considerable growth, the percentage of Americans relying on TV and newspapers for campaign news has remained relatively flat since 2004. The internet now rivals newspapers as a main source for campaign news. And with so much interest in the election next week, the public’s use of the internet as a campaign news source is up even since the primaries earlier this year. In March, 26% cited the internet as a main source for election news, while the percentages citing television and newspapers remain largely unchanged. [Read Article]

I’m reminded of how Kodak had to shift its decades-long focus on film about five years ago.  They actually closed their Rochester manufacturing plant to focus on a whole new line of digital products.  Corporations and big shots don’t determine what products are produced–consumers do.

“Time Inc., publisher of Fortune, plans to slash 600 jobs, according to a report in The New York Times. Gannett Co., publisher of USA Today, plans 3,000 job cuts, according to Reuters, and the Tribune Co.’s Los Angeles Times plans to cut 10% of its workforce.”  View article entitled Print Media Companies Slash Jobs as Economy Sputters.  The Washington Post reported print advertising dropped 14 percent for the quarter, and was down 16 percent for the first nine months of 2008.  View article Washington Post Co. Profit Plummets in Third Quarter.

Why do so many people love their Internet news?   Is it because it’s free?  Or is it because it is easily accessible 24/7, has unlimited search and result possibilities, includes opportunities to interact and participate, or is it because Internet news has both audio and videos?  Maybe it’s all of the above.

Watch in the months and years ahead as traditional media moguls are humbled by the ending of an era.  Who doesn’t read most of their news and information on the Internet?  After all, you are reading this article.

Update 12/29/08:  A major real estate brokerage published this nice little ad in their local paper:

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The trend has been here for many years, but newspapers haven’t wanted to face it, and now many newspapers find themselves in serious trouble because revenue is dramatically down.  Why?  Because sellers are not willing to pay high advertising rates for zero results.  Why are sellers unwilling to pay for newspaper advertising?  Because the old style newspaper advertising doesn’t hook buyers anymore.  Sorry newspapers, but times are changing.

One newspaper company, which I think is fairly representative of the newspaper industry, reported:

As the industry remains mired in a protracted decline in print advertising that has persisted for more than two years, Chief Executive Gary Pruitt said ad sales continue to look bleak in October.  . . . Classified ad revenue has been a black hole for the industry since 2006, with particular weakness in the real estate, help-wanted and automotive categories.  McClatchy said Tuesday that real estate ad revenue fell 37%, help-wanted by 43%, and automotive by 21%. ¹

Circulation is substantially down, too.  “Newspaper circulations are declining largely because of the ongoing migration of readers to the Internet.  Despite the drops, newspapers are currently more worried about even steeper, double-digit reductions in advertising revenue caused largely by the weak economy.” ²

The National Association of Realtors’ national survey indicated that over 80% of all homebuyers start their search on the Internet.  Why not?  It’s conventient, free, and can be done any time of day or night.

As I have written elsewhere, we are in a major transition in how real estate is bought and sold, and this transition of tidal wave proportions is dramatically effecting newspaper and magazine advertising.  Unfortunately, newspapers have not been able to manage the paradigm shift.  In fact, they have been reticent to admit it is even happening.  Let me say this in a very simple way, no offense intended, but perhaps this will clearly make the point.  “You cannot teach a cat to bark.”  Traditional media really can’t figure this stuff out, try as they might.  Many are trying all kinds of “things,” but you have to first understand the problem before you start unleashing wild solutions.  There is now a huge “disconnect” between traditional print media and consumers.

The consumer figured this out, and the average consumer knows exactly how to search for what they want.  You’ve got to love free enterprise and the power of the consumer.  Consumers are changing an entire industry, and they are doing it without thinking about it.  They’re just being rational and reasonable consumers in a free enterprise system that gives them freedom of choice.

For Buyers of real estate in Sequim and Port Angeles, I welcome you to what you found right here, articles about real estate, marketing, prices, foreclosures, negotiating the best price, and the ability to search the entire multiple listing service right from this site.  Come to think of it, the fact that you are reading this article is proof of the power of the Internet.

Very truly yours,
Chuck Marunde, J.D., Broker/Realtor (retired real estate attorney)
Sequim & Port Angeles Real Estate, LLC
618 South Peabody Street, Suite I
Port Angeles, WA  98362
360-775-5424

1. MarketWatch, Oct. 21, 2008, read full article here. [↩]
2. Read Forbes Article [↩]

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