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Real estate transactions facing new conceptual frameworks

Technology is now invading the real estate industry to introduce new models of how real property can be bought and sold. The result is that consumers may be able to save considerable money by avoiding high-priced real estate broker commissions in the future. California, as usual, is positioned to be in the vanguard of such industry-wide changes in the nature of how real estate transactions are conducted.

At a minimum, consumers now have online access to listings of real estate that is for sale in their localities. This is accomplished through services like Zillo and others that are emerging in this rapidly-changing landscape. Another startup service called Beycome is an online platform that directly connects buyers with sellers and effectively cuts out the middle man. It is similar to the "for sale by owner" model, but it provides access to various informational data bases that the old models did not provide.

Now buyers will have access to all the information previously hidden from the public on the real estate brokers' multi-list data bases. While these are just startup companies, they have completed hundreds of transactions and given their customers heavy discounts on the traditional real estate broker commissions. One problem making the old system obsolete, according to Beycome's founders, is that brokers and agents are making very large amounts of money but not providing an equivalent in services to consumers.

The trend in California and elsewhere for the long-term is inevitably toward consumers educating themselves about the real estate transactions that they seek. The rapidly-expanding technology cannot be subdued to maintain a closed system in the real estate industry.  However, the legal mandates of such transactions will continue to require the involvement of title companies and real estate attorneys. The intricacies of inspecting the legality of title, clearing existing liens, adjusting tax and utility bills, paying governmental fees, resolving legal impediments, and the insuring of ownership and lender positions will continue to prevail into the foreseeable future.

Source: huffingtonpost.com, "3 Ways the Real Estate Model is Changing to Empower Consumers", Ahmad Raza, Sept. 15, 2017

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