How will role of broker be changed by Internet?

If anybody really thinks that the Internet is going to displace brokers in the real estate business, there's a bridge connecting two of New York's borough that's for sale, real cheap.

In the sale or renting of real estate, particularly commercial, there has to be a person to show the property or space, a person to negotiate for the buyer or seller or tenant, and a person who is knowledgeable about the market and availability.

If you think a digital connection is going to displace this person, the broker, think again.

In a survey of a cross-section of firms in the industry, there seemed unanimity that the Internet would, yes, play an expanding role in brokering, but the broker would, no way, be replaced or obliterated.

John Gilbert, executive vice president and chief operating officer at Rudin Property Management, a company that provides management over the Internet, said he sees Internet capabilities augmenting the industry. "The Internet access is an opportunity and will not affect the business negatively in the least. The smart, aggressive brokers are going to use it to their advantage. Of course, when you've got a broker who doesn't do extra work, he will see the drawback. But those who are hungry and know what they are doing will see the potential in online commerce."

The human side of brokering was also emphasized by Roger Novatt, the managing director of Sumitomo Real Estate Sales, an international firm, "Buyers, especially first time buyers, feel more comfortable when someone takes them by the hand and makes the whole thing easier for them."

Applications of the Internet as a data base for brokers is demonstrated by information provided by firms such as Co Star. "The buyers who go to CoStar don't really see all of the information necessary for making an investment decision," said Steve Coutts, regional vice president of CoStar Group. "If a buyer goes online and requests a list of properties in a certain area, and of a certain size, 90 per cent of the results that he is going to see will already have a broker involved from the side of the seller. And the 10 per cent will not be available to him," he stated. "So the broker will be there.. The whole point of our company is to make the system more efficient for real estate people."

There is the perspective of the small firm, though, that may be more susceptible to the encroachment of the e-commerce brokering than large companies. Amatuma Amatullah, vice president at Granite Realty Associates, concedes that sales have gone down somewhat as a result of online trading. According to her, the Internet companies are different from traditional firms. "Real Estate is not an ordinary commodity. It's an investment; it needs to be looked into and analyzed in a way that is not possible online. A good, experience broker is irreplaceable. Serious investors don't buy property on line. Only first-time buyers do."