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Buying Property Over the Internet

A realtor with Prudential Douglas Elliman, Jacky Teplitzky, was baffled when her client, a San Francisco-based banking executive, recently purchased a spacious $2.5 million four-bedroom condo on the Upper West Side - without first seeing the property in person.

"I kept asking him if he was sure," Ms. Teplitzky said. "And he insisted he was. He had taken a virtual tour on the Internet, saw the photos and floor plan, and said it was as good as being there in person."

While the typical homebuyer may not be as bold as Ms. Teplitzky's client, the number of prospective buyers using the Internet to search and even purchase real estate online has surged in recent years. According to the National Association of Realtors, 74% of homebuyers say they used the Internet in searching for real estate, a number that has nearly doubled since 2001 and is up from 2% of buyers in 1995.

"I'd say that the Internet is not even a trend anymore but the de facto means by which people find real estate," the president and chief executive of real estate brokerage Dwelling Quest, Daren Horning, said. "Looking in the New York Times these days is like looking in the phone book for a pizza place."

Mr. Horning says close to 95% of his real estate transactions take place online via e-mail and Web sites. The ability to post property listings has also allowed him to cut his print advertising expenditures by 80%. "The price point of Internet advertising is pennies compared to print," Mr. Horning said. "And the newspaper goes in the garbage every morning. The Internet is open 24/7."

Ms. Teplitzky has also seen a similar shift, especially in the type of buyers that use the Internet for real estate searches. "At the beginning it was mostly young people," she said. "Now we see people from all over the map. And they are savvier and certainly more informed. They know exactly what they want when they step into an apartment."

Use of the Internet is slowly changing the real estate business. Realtors were once responsible for finding properties. Now the buyers have taken that role. "Now it is more about making it happen for us," Ms. Teplitzky said. "We help advise on prices and negotiate terms with the seller."

And brokers say it has been good for business. By posting listings online, sellers can increase their advertising reach, attract more viewers, and increase demand, a move that ultimately drives up property values. Additionally, buyers can now streamline their searches to fit specific requirements, which helps them pinpoint their needs faster.

"From an ad, people can't visualize an apartment," Ms. Teplitzky said. "Now they can bookmark their requirements and receive updates when properties becomes available."

The vice president of research at the National Association for Realtors, Ellen Rosche, attributes the growing trend in part to advancements in technology. "A lot of people had computers five years ago," she said. "But the high-speed technology wasn't really there to view images, nor were there the kind of search engines that we have now."

While the ability to view, and even virtually tour, real estate online will certainly continue to advance over the years, Ms. Rosche doesn't believe it will replace the visceral experience of walking through a new home anytime soon.

"Houses are so diverse and idiosyncratic that I think the number of people that buy homes without seeing them will still remain very small and occurs only in certain circumstances. I don't think it will become the norm," she said.

Nor does it signal the end of the Sunday real estate section. According to the executive director of the National Newspaper Association, Brian Steffen, real estate ads remain an integral component of a broker's advertising reach. Real estate ads have not declined in newspapers in the way help wanted ads have, which have shifted to Web sites such as Monster.com.

"The Internet may be more convenient for buyers, but some brokers find that it hurts them," Ms. Steffen said. "The Web sites tend to highlight the listings and lump the brokers together, only giving them a one-line mention. A listing on a Web site does not have the same presence of a quarter- or half page ad in a newspaper."



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