2006 In Review: Top Online Real Estate Stories
It’s that time of year — time to try to bring it all together and make sense of it all. Here’s one tongue-in-cheek perspective making its way around the Web. But more to the point, here’s my attempt at distilling this year’s top themes in online real estate.
1. Open It Up: Without a doubt, 2006 will be remembered in online real estate as the year that more information than ever became accessible to consumers, for free. Zillow launched in February and is proud to help lead this information revolution. But other companies such as Trulia, Redfin and PropertyShark are also putting tools and information in the hands of the consumer; free home valuations, transaction history, property information such as beds and baths, selection tools for comparables, neighborhood and school information, and for sale postings are just some of the information that is now readily accessible on the Web. It’s all about turning the lights on in a dark room and getting access to that treasure trove of information that has been collecting dust in the filing cabinets of county courthouses for decades.
2. Everyone’s an "Internet buyer" (well, almost everyone): According to the California Association of Realtors, 70% of homebuyers now use the Internet as an integral part of their home buying experience.
3. Blogs go mainstream: In 2006, real estate blogs went mainstream. In a few short months, the real estate blogosphere exploded. Now blogs like Rain City Guide, Bloodhound Realty and 3OceansRealEstate are not only providing deeper commentary on industry issues, but becoming quoted "experts" in mainstream media. Corporate blogs (like this one) have become de rigeur communication mechanisms. Blog networks such as Active Rain have provided a technology platform and an audience for Realtors anxious to speak their mind. And the collaborative Carnival of Real Estate has been cataloging all of it.
4. B-b-b-b-bubble? In 2006, hardly a day went by without the bubble debate taking center stage. It was a constant battle of data from OFHEO, NAR, Zillow, and others.
5. The growth of online advertising: In 2006, both Borrell and the Kelsey Group (and others) produced interesting research about the growth of online advertising. By most accounts, about $16 billion was spent on online advertising this year, with up to a quarter of it in the real estate, financial services and mortgage industries.
6. Bird’s eye is everywhere: Zillow was proud to be the first residential real estate site to add Microsoft’s Virtual Earth "Bird’s Eye View", but since then there have been others. Bird’s Eye View has rapidly become accepted as a critical piece of search functionality for a real estate site.
7.Brokerage sites strike back: Not content to let online media sites have all the fun (and eyeballs), real estate brokerage sites joined in the arms race this year in an attempt to grow their site traffic. Many added functionality such as Bird’s Eye View (see #6 above) or Zillow’s Zestimates in order to make their sites more exciting for consumers. And it paid off — about 5 of the top 15 real estate Web sites are brokerage sites.
8. Guilty as charged: Stuart Wolff, the former CEO of Homestore (the company that basically invented online real estate, now renamed Move.com), was found guilty of conspiracy, insider trading, and many other bad deeds. He was sentenced to 15 years in federal prison.
9. Mortgage fraud: There were far too many stories of mortgage fraud in 2006. But I don’t want to end on a downer, so…
10. Sand Hill Road joins the fun: By most estimates, more venture capital was invested in online real estate in 2006 than any year since the 1990s. Zillow, Redfin, Trulia, and several others all raised venture capital rounds to support their growth.
So what do you think 2007 holds in store for our industry?