Retailing over the internet has been growing steadily over the past decade and now has expanded with an explosive growth. With the rapidly evolving customers shopping habits and game changing technology, the impact on retail industry is profound. Amongst these opportunities and other economic challenges, real estate industry is gauging the effect of the internet on consumer behavior and retailing business models.
The very common industrial practices will undergo disruption. The dominance of big players is set to reduce and online alternatives will take over by offering superior selection, lower price, and more convenience. The real estate industry is undergoing a rapid transformation as technology is encouraging use of new business models.
According to the reports by IBEF, the real estate industry in India is one of the fastest growing markets and is expected to reach 180 Bn USD by 2020 with a CAGR (Common Annual Growth Rate) of 11.2%. Despite this, there are approximately 900 million square feet of the unsold assets in the business in the traditional market. Many online real estate firms like Housing.com, MagicBricks, CommonFloor have jumped on the bandwagon to make the most of the opportunity and leverage the power of internet and technology.
With high speed internet connections, smartphones, Virtual and Augmented Reality, a number of potential buyers are investing a lot of time in pre-buying stage and comparing properties online. The internet has influenced transactions worth 40 Bn USD in India- residential and commercial both. In fact, approximately 80% of the research done online regarding properties is related to the residential buying.
The scenario will not change much. According to Google Search reports, online queries on real estate for residential buying has gone up by 3% in India. These researchers refer to the online aggregators’ website more as compared to the other websites as the exact information is available. These websites indicate location, amenities, information about locality, market trends, and opinions which greatly influence the buyers’ decision and making these websites more trustworthy.
These trends undoubtedly indicate that the internet and online aggregator are playing an important role to shaping real estate industry in this era of e-commerce. With availability of information just a click away with access to expert data and trends, consumers are making more informed decisions as compared to times before.
With opportunities opening up for enormous growth, most of these e-commerce real estate companies are fuelling their marketing activities in order to grab a major chunk of the market share and reach maximum internet users.
It is still early to say how the real estate industry will leverage the enormous potential of e-commerce in the upcoming year. While we have already surpassed the USA with respect to internet users and chances are we would beat them even in terms of smartphones penetration, the e-commerce for real estate industry is yet to create a meaningful impact. Current players still need to build trust and brand value. For a consumer, it would be another property if not one, but for current industry players brand reputation trumps all. With newer disruptive models, e-commerce for real estate is definitely here to stay.
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