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Shifting the real estate brokerage paradigm

RISMEDIA, May 4, 2007-It isn't that real estate hasn't experienced new business models before, or that brokers are scared, but new models are multiplying like rabbits. The amount and assortment that have emerged during the last decade have proliferated into a full four-page menu of choice, enough to mystify even the savviest of brokers. And while everyone slowly absorbs the abundance of alternatives, time is not standing still and a reshape of the industry is already visible.

MLM, Annuity, Residual, Auctioneering, Flat-Fee, No Fee…there are so many interesting and exciting new models, but then there are also so many brokers clinging to the traditional model. It's not that the existing model is all that bad, but with outdated compensation plans, weak infrastructure and unnecessary physical locations it is going to become increasingly harder to compete. Many will likely see their market share eroded over the course of the next few years with the gainers coming from both successful new models as well as traditional companies willing to adjust.

As part of the thrust to rise above the white noise, many of these new models claim to be unique, the first, the only, or the largest. Rarely are any of these statements really valid or have any real meaning. Also, many models are variations of one another, a combination or a mashup of two others, causing even further confusion. The battle however, is all about proving the validity of the new model while simultaneously gaining sufficient critical mass to prove that it can be profitable.

And this task is not easy, nor does it happen overnight. It would appear that the industry is about half way through a decade-long transition – one that will create a variety of new leaders and bury some of the existing. Previously companies such as Century 21, RE/MAX and EXIT have shown that it takes between 5 to 10 years for a new player and/or new business model to establish a paradigm shift in the real estate industry and to become a true national entity. However, all indications point to the fact with Web 2.0 and Gen X, this timeline may be getting shorter.

So adapting traditional brokers who elect to become progressive, re-engineer and restructure their existing models with the introduction of some of the new focal points, will have a very good chance to hold on to their existing market position, maybe even have an opportunity to expand it.

"No model, traditional or new, has yet emerged as a clear winner," states Stefan Swanepoel, author of the 2007 Swanepoel TRENDS Report. "What is certain however, is that the winning models will be those that incorporate a strong online capability, a strong consumer-driven focus and that offer a wide selection of services at a lower cost."

This is all part of the intense, fact-filled 159-page 2007 Swanepoel TRENDS Report that analyzes the top 10 trends that are influencing the future of the real estate brokerage industry.

To stay on top of all the options get your copy of the 2007 Report today at Use the promo code RIS2007 for a 10% discount.