Thursday, January 14, 2016
A word of caution about free real estate search engines
Lindsay Romaniw (Columbus, Ohio)
By now, most of us are familiar with residential real estate websites that help users find apartments and homes for lease or sale, such as Zillow, Trulia, etc. These search engines certainly provide benefits to prospective tenants, buyers, landlords, owners and brokers, but they also have drawbacks that are less obvious and can hurt all parties involved.
In the last few years, similar models were used to create free search sites for commercial space. Using a site like 42Floors, businesses can conduct free searches for office space available for lease in their desired area. A free commercial space search site seems like a great idea for prospective tenants – as well as landlords and listing agents. So why do I advise everyone to use cautious when using these sites?
1. Many contain inaccurate information.
While you will find inaccuracies on almost any real estate website due to the fast-paced nature of the industry, the error rate is particularly high for free sites like 42Floors, Zillow, Trulia, etc. These listings are often unverified because the site rarely has a relationship with the landlord or agent, but rather pulls listings from various uncited sources. This practice causes available space to be missing or misrepresented, floorplans to be inaccurate, flyers to be outdated, and the list goes on. Users miss out on numerous office space opportunities and landlords/agents lose potential customers and clients. Redfin did a study on the accuracy of residential real estate websites, finding local brokerage sites to be more accurate – and timely – than Zillow or Trulia. One can assume this conclusion would apply to commercial real estate websites as well.
2. Sites gives users a false sense of confidence.
For someone new to the commercial real estate industry, market knowledge takes time – and resources to which an individual using a free site simply does not have access. Looking for office space is not an easy task; commercial real estate is a significant investment – and leasing or buying decisions can make or break a business. According to the American Law Institute, leasing commercial office space is one of the largest expenses incurred by new and expanding businesses. Hence, a real estate professional is a crucial part of the transaction. When backed by an established firm, agents have access to the most recent market data and sales and leasing activity. From site selection to negotiation, agents make sure their clients find the best space for the best price.
Personal Story: I’m constantly searching the residential real estate market in my area. One morning, I came across a home within my budget and immediately contacted the listing agent provided by Zillow, but the agent did not get back to me. A few hours after I called my own real estate agent, she was able to tell me that not only was the home unavailable, but that the owners stopped accepting offers at noon earlier that day – although a deadline was not posted on the site – while I was waiting for my Zillow message to go through from days before.
My experience with 42Floors was not any better. Being responsible for my office’s marketing efforts, I try to stay up to date on the latest commercial real estate websites. When I discovered 42Floors, I found a few Avison Young listings with old brochures attached, incorrect suite availabilities, and one active listing that was posted as unavailable. I immediately contacted the company, and while I did receive a timely response allowing me to update the listings, it was the first contact I had had with anyone from 42Floors in the years that it has been actively advertising listings.
The industry is changing constantly, and these websites are going to continue to pop up, as they are becoming a useful tool for everyone involved in real estate, particularly buyers and tenants. Avison Young offers a free and accurate search for property listings right on its website – listings that are posted directly by the broker and updated frequently.
My advice to users is to seek professional help from the beginning and to verify all options. (Yes, even the ones that say they are unavailable.) Many times, the space you find online may be unavailable, but the agent knows of a similar space that will be available in the next few months and is not yet posted. Or better still, it actually is available, and the site just had the details wrong.
In any case, don’t leave one of the largest financial decisions that your business will make in the hands of a free website provider.
Posted by Avison Young Guest Blogger at 3:17 PM