We've had repeated visits from a porn comment spammer. So, comments on older posts have been closed. Comment freely on recent posts.

Our client services director, Chuck Gekas, e-mailed me a recap of the two days he and Nat Swift spent exhibiting at the recent Illinois Association of Realtors convention. He reports (in part):

In a nutshell, the overwhelming number of agents that seemed to get the concept fell under the age of 45. The older agents visited our booth to drop their business card in hopes of winning the camera [we were giving away] and to gobble up some of our free candy.

The younger agents that understood the concept thought HomePagesUSA was very cool. Unfortunately about half of these folks admitted to be not too computer savvy.

Given the fact that computer skills are essential for real estate agents today (to search the MLS, if nothing else), it’s hard to fathom how any younger agent can hope to remain in the business while being "not too computer savvy."

Since many agents are probably reluctant to volunteer that they lack computer skills, the percentage that come up short is likely to be far higher than the 50 percent that Chuck reports.

Now, add in the 45+ agents - who form a majority of all agents - and you’re left with a small minority of agents who are able to meet the needs of Web-savvy buyers and sellers. These folks have a strong advantage in gaining business, and won’t need to do much to differentiate themselves from the slugs who’ve failed to adapt.

Technology and knowledge are now the key factors of production. With increased mobility of information and the global work force, knowledge and expertise can be transported instantaneously around the world, and any advantage gained by one company can be eliminated by competitive improvements overnight. The only comparative advantage a company will enjoy will be its process of innovation–combining market and technology know-how with the creative talents of knowledge workers to solve a constant stream of competitive problems–and its ability to derive value from information.

– Knowledge economy

The residential real estate industry is still mired in the neo-classical economy, in which labor and capital are the key factors of production.

The industry is, however, finally about to enter the new economy in which technology and knowledge are key.

Internet companies rather than real estate firms are propelling the industry into this new economy, and that has important implications for the value of real estate brokerage services.

In plain English, real estate commissions, already under pressure, will be drastically reduced unless real estate companies and agents build and own the "key factors of production."

It’s already too late for real estate firms to regain technology leadership: Google, Yahoo!, Microsoft, eBay, Amazon, et al. have growing and, most likely, insurmountable leads.

The battleground will be information and market know-how: who will do the best job of organizing and communicating the real estate knowledge that consumers crave?

Thus far, the battle has been focused on access to real estate listings – who owns the data and has the right to control its distribution and display. Access to listings is a sideshow: consumer demand and seller sophistication will eventually force unrestricted and pervasive access to complete lists of homes for sale and for rent.

Real estate market know-how and information is, and will remain, intensely local and constantly changing. That gives individual real estate agents, who are closest to local markets, a competitive advantage over their real estate firms and the Internet companies who are seeking to capture the lion’s share of the value in real estate commissions.

How individual real estate agents can capitalize on that advantage and reap the rewards of their market knowledge and expertise is the ongoing topic of this discussion. More, later.

The Mamet metaphor is strong. After reading Joe's inaugural post this morning on our new blog, I got a call from an agent who told me specifically that she can't see herself as a sales agent in the Glengarry Glen Ross model. She's been working in the real estate industry for over a decade, and she gave voice to exactly the concerns that this site will be addressing. It's all about leads, she complained, saying that she's attended seminars where she's been directly instructed to think of clients as leads, and to keep contact with them as limited as possible. The idea is that you can move on to find the next lead and close the next sale while assistants deal with the mundane task of actually talking to people. The reality, she suggested, is that clients who are treated that way will remember that they've been treated that way, and by whom. For people who work in an industry that depends on word-of-mouth and long-term relationships with consumers (and that seems to thrive on gossip, as I'm quickly learning), this seems counter-intuitive to me, and it seemed that way to her as well.

I'm meeting with her next week (I probably could have closed over the phone, but I thought maybe sitting down with her to talk directly and personally about the products she's considering would be, well, more personal), and I'm thinking that she may end up providing a great example of HomePagesUSA's ability to facilitate a long-term conversation and personal connection between agent and consumer that other Internet tools, focused exclusively on leads, simply can't do.

She told me a brief story about a client she worked with years ago to illustrate her point. It was a first-time seller, someone who had come through a family member's recommendation. The evening before the listing was scheduled to go out, the agent received a call from her new client. She was dealing with personal issues, and asked if the listing could be delayed temporarily until she felt ready to focus on it. The agent, having already established a strong enough level of personal contact to allow a phone call of this nature, agreed to hold off on the listing, even though it meant a loss of resources to stop a process that was already in motion. This wouldn't have been possible, she said, for agents who have already moved on to their next lead, and she suggested that many agents would have held their client to the original date to speed up the sale and keep looking for more. She can't picture herself as that type of agent, she told me, and she won't fall into the current mentality of treating people as leads. Even if it means she loses the El Dorado.

In the coming days I'll be looking at the Home Pages that are currently being used by agents to communicate with people, and I'll be highlighting the ones that are doing it well. The new Neighborhood update feature of New Homes Magazine provides a strong resource for consumers looking for expert analysis and insight, and gives agents the opportunity to start a conversation with leads — who are, after all, people.