Homes On-Line--Call It Virtual Realty : Technology: Thanks to advances in Orange County and the Valley, more and more consumers are real estate shopping by computer--without all that driving.
“I want this one!” says 3-year-old Evan Donnelly, pointing to the color photograph of a tile-roofed house scrolling up on his parents’ computer screen.
“No, this house is too small--I can tell,” said Mary Donnelly, sitting with her son in their Yorba Linda bedroom and turning toward her husband, Brian. “Go to the next one,” she said.
With a click of the mouse, the computer brings up another house matching the Donnellys’ list of preferences. The routine is a familiar one for the family, which spends its evenings shopping for their dream home--without ever leaving Yorba Linda.
Not keen on spending their weekends driving aimlessly through unfamiliar neighborhoods, the Donnellys use time after work “visiting” properties via computer, weeding out obviously unsuitable houses. Using a CD-ROM program developed by a company in Brea, the couple say they have found a high-tech way to eliminate some of the tedium, frustration and stress from home buying.
“With two children, looking for a home can be an exhausting process,” Mary Donnelly said. “This makes it easy.” The Donnellys aren’t alone in turning to computers for help in home shopping.
When more than 17,000 real estate brokers gathered in Anaheim in November for their annual national conference, the group focused on how to give clients more electronically packaged information. Computers anchored almost every booth as attendees gathered to buzz about the latest high-tech marketing tools.
The reason: Most agents have come to realize that colorful yard signs, open houses and a smiling realtor are no longer the best way to sell a home. Now using sophisticated data sources to compete, realtors from the San Fernando Valley to Fountain Valley are among the first in the nation to use on-line systems. And as major real estate companies rush to travel the so-called information superhighway, yesterday’s real estate broker could be left rolling behind like a fallen hubcap.
Realtors are betting that, like the Donnellys, their clients will demand more and better information before they begin shopping for a home. Though some brokers are nervous about giving up some control, most predict that shoppers will one day work only with brokers who provide the most complete and current information.
“The floodgates are about to open,” said Mark Surfas, director of on-line communications at Coldwell Banker Residential Real Estate in Mission Viejo, one of the nation’s largest real estate brokerages with more than 2,300 offices. “We’re blending a lot of different technologies together and turning this into a real estate information Disneyland.”
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These days, shoppers can select their next dwelling on computer kiosks located in seven California malls, including one in Mission Viejo. A kiosk is slated to be installed in the Glendale Galleria and five other malls next year. Computers have replaced model homes in Aliso Viejo, where buyers instead look at computerized images of home designs developed by two Orange County companies.
And for the ultimate home-buying experience, consumers may one day use virtual reality centers--with computer-generated, three-dimensional house designs--to “walk through” rooms of houses or even entire neighborhoods without ever going outdoors.
While on-line networks aren’t yet available in most of Southern California, the San Fernando Valley Assn. of Realtors has unveiled a new system where buyers can use a computer network to choose a home, electronically fill out escrow and title information, and get preliminary mortgage approval in a single visit.
“They are the only board in the country doing this. I take my hat off to them,” said Almon R. Smith, executive vice president of National Assn. of Realtors, which is developing a nationwide system based on the Valley model.
“It is sweeping the entire industry. When you get down to it, real estate--more than anything else--is about the flow of information. Everyone’s trying to figure out how to link things together.”
With 7,500 members, the San Fernando board is the nation’s third largest realty board and the largest in California. It is also the first to offer its members a network that stores up to 10 color photographs of each home listing, full descriptions of the house, recent home improvements and information on local schools. Designed by Pacific Bell, the system can also create a list of properties tailored to a buyer’s specifications and print out maps showing the location of every home.
At a Century 21 office located just up the street from the Northridge Meadows apartment complex where 16 tenants died in the Jan. 17 earthquake, Lisa and Bill Smith are shopping for their “first real home.” The couple saw their condo damaged in the earthquake, but neither are willing to give up on the Northridge area. They admit, though, that neighborhoods littered with earthquake-damaged homes add a special challenge to home buying.
“You can see right here, the chimney is gone,” said their realtor Marc D. Schwartz pointing to a picture of a Northridge home on the computer.
“On your typical listing, it would just say, ‘needs some TLC’ or ‘slight earthquake damage.’ With the computer listing we can tell right away we don’t want it,” he said.
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Schwartz plugs in the Smiths’ specifications--three bedrooms, maximum price of $160,000, favorite neighborhoods--into the computer and pulls up 75 properties. The couple quickly scans through computerized photos of the homes, discarding the undesirables, especially those with serious earthquake damage.
“She wants a big house, and I want a big garage,” said Bill Smith, 30, who owns a window cleaning company. “This saves us so much time because we discuss it right here. Especially when you have kids, you don’t want to spend the day driving around.”
“Things are changing so rapidly, we had to change or we’d be left behind,” said Alice McCain, president of the Valley realtor board. “We wanted to be on the forefront.”
At the Mission Viejo Mall, a computer kiosk designed by New Home Search offers buyers photographs and floor plans of homes. Using CD-ROM technology, buyers tour both new and resale homes just by touching a computer screen.
“Looking for a home is a grueling process,” said John Giamo, head of Visual Listings Inc. in Brea, who joined with Jeff Meyers of the Meyers Group, a Newport Beach real estate data company, to create New Home Search in 1991.
“Now in the comfort of your home or in your broker’s office, you preview the homes. For someone who wants to cut down on the problems, this is perfect,” he said.
Visual Listings also produces a real estate CD-ROM, packed with up to 25,000 listings. About 30 consumers, including the Donnellys, receive the disc free in their homes each week as part of a test program and about 100 brokerages subscribe to the CD-ROM service for $35 a disc. The company charges about $20 to brokers to place a listing for a resale home in the database and charges $150 to builders for new properties.
Critics of the service say the cost of manufacturing a CD-ROM is prohibitive--though the company said each disc costs only about $6 to make and could go lower--and point out that listings can expire quickly. Giamo admits that the program is still developing, but said computer users will be able to access the company’s listings on the Internet by next spring.
Giamo said the system developed in the San Fernando Valley is tailored to meet brokers’ needs, not those of consumers. His system, he said, is designed specifically for home buyers. And that, he says, makes Orange County realtors a little nervous.
“It’s been a very frustrating situation with Orange County brokers; they have not embraced the technology, but consumers love it,” Giamo said. “There is some fear of them being out of a job--that is not the intent. We’re just a marketing tool.”
Chuck Smith, executive vice president of the East Orange County Assn. of Realtors, which with 2,100 members covers Santa Ana, Orange, Anaheim Hills and Tustin, acknowledged a certain resistance to change. But his group’s agents can now put home listings on the Prodigy on-line service and said eventually all brokers will be on-line.
“We have been looking at similar things to what San Fernando Valley has done. We find our members are very receptive to some of the new high-tech innovations,” Smith said. “But there is always some resistance to anything new.”
Smith, a realtor for 25 years, predicts that Orange County brokers, despite initial reluctance, will eventually all be on-line.
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The Internet, a global connection of computer networks and databases, will help provide a more intimate place to shop for a home. Offers and listings are already appearing on the World Wide Web, a subdivision of the Internet where members can advertise. The system allows for text to be combined with sound and even video, providing an opportunity to show many features of a home.
One is those companies is BayNet Co. in Palo Alto, which uses the World Wide Web to offer listings of houses for sale in the San Francisco area. Formed in July, BayNet contracts with listing companies to provide details on new and resale homes. It charges agents $35 for each listing and charges real estate brokerages $1,000 a month for up to 15,000 listings. It also contracts with the San Mateo Times to reproduce its real estate section and other news articles on-line.
“Our home listings are being accessed by 1,500 viewers a day--some as far away as Japan and Hong Kong,” according to Gabriel Gross, founder of BayNet. “Our next target is Southern California, where the Internet culture is not as strong as it is here.” Some of America’s largest real estate brokerage firms--Coldwell Banker Residential Real Estate and Century 21 Real Estate Corp., both based in Orange County--are taking note, spending millions of dollars to get their hundreds of thousands of brokers wired with the latest high-tech sales gadgets.
Coldwell Banker is expanding its fledgling Scoop software program so that by early next year, consumers can walk into a Coldwell Banker office to look at pictures of various homes, check out schools and shop for a mortgage loan on the computer.
Prudential Real Estate Affiliates of Costa Mesa is building a $1-million center on the East Coast with interactive television to view homes--virtual reality centers where potential buyers will “walk” through dozens of homes without leaving the office.
The only thing missing are sales agents.
“There will be no salespeople there--but you can find out about everything: homes for sale, mortgages and escrows,” Prudential spokesman Ron Tepper said. “The real estate transaction is the most barbaric thing there is. We want to change that and give consumers what they want.”
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Not all brokers embrace multimedia home shopping. Realtors, through their local realtor boards, are used to controlling the information available regarding local homes for sale, and don’t like the idea that listings could be accessed directly by a consumer. Some especially challenge the theory that one day a broker may no longer be needed.
“This is still a lot of electronic sizzle,” said Dick Rafferty, a broker with Electronic Realty Associates in Fountain Valley. “People don’t buy homes off the computer. They have to go look at it.”
Many realtors say that while computers can provide buyers with more information, buyers will still need a professional real estate broker to guide them during the sale. One of those is Garden Grove realtor Pat Neal, past president of California Assn. of Realtors.
“While it’s going to be difficult getting the brokers to accept letting buyers have more control, we have to change because the clients have already jumped ahead and are demanding it,” she said.
