June 1, 2000

Virtual home tours are a big hit

By TOM KELLY
The Real Estate Advisor

The Internet has been called the greatest tool in the history of. . .just fill in the blank for a particular industry.

Real estate certainly is no exception. Consumers can now perform research not only on properties but also on professional sales people via slick websites and vast libraries. And, visual presentations have become so important that many companies and agents continually expand their offerings in an attempt to impress, persuade and sell.

Virtual home tours have become almost common, especially for upscale homes. How can a savvy agent better provide an out-of-town client an accurate feel for a special home? The tour also leaves the impression that the agent, or seller, is willing to go the extra step for the client - even in neighborhoods where sales still are brisk and inventories dwindling.

In fact, some agencies now offer home a virtual home tour for every listing, regardless of price or location. One Puget Sound company that recently jumped on board is Sutton Real Estate, Inc., an independent, which recently signed a deal with iPIX for an initial purchase of 400 virtual tours.

What sets Sutton apart from most other brokerages is that it's a 4 percent listing company, retaining 1 percent as the seller’s agent and paying 3 percent to the buyer’s agent. While real estate commissions are negotiable, the standard fee has become about 6 percent of the sales price.

"When a real estate company receives only 1 percent for selling a home, it is necessary to be incredibly careful that home marketing dollars are being spent wisely," said Ken Sutton, broker. "We are convinced that the iPIX tour is a quality product that will do nothing but improve our performance in the marketplace."

The iPIX visual content allows potential homebuyers to "teleport" themselves visually to a home for sale. There, they can "pivot" and look at a panorama of the home, typically 3-4 large pictures pulled together. The action can be paused so viewers are able to change their point of view or zoom in to a particular room.

"These tours work as a pre-qualifier, which saves buyers’ agents and their clients valuable time and money," said John Assaraf, iPIX’s senior vice president for real estate. "They will help Sutton agent market and sell homes, attract new listings and improve the overall efficiency of the home buying and selling process for their customers."

IPIX clearly holds the top spot in the virtual tour business. Last December, iPIX merged with its chief competitor, bamboo.com, after two years of fighting for market share.

Bamboo.com, originally called Jutvision Corporation, was based in Toronto and started by Leonard and Kevin McCurdy. Three years ago, Jutvision shocked the real estate world making its virtual reality tours available for $99, cutting many of its competitors' offerings by 50 percent. The price included four "scenes" and a cameraperson to film the property.

"We simply wanted to make this available to the average agent or seller, enriching the way people buy, sell, rent and lease real estate," said Kevin McCurdy.

The largest virtual-tour trial took place north of the border. Jutvision partnered with Royal LaPage Limited, one of Canada's top residential brokerages. The concept was implemented to 7,000 agents in over 400 branches.

"Virtual tours differentiated Royal LaPage from its competitors," McCurdy said. "It proved to be an improved way to buy and sell residential real estate." When the Canadian test was off-the-charts successful, Jutvision raced to the states, changed its named to bamboo.com and mounted its challenge to iPIX from its new headquarters in Palo Alto, Calif.

The two companies were definitely different as they tried to persuade sellers and brokers to purchase their respective products. IPIX utilized its propriety, 360-degree image technology featuring two back-to-back fisheye lenses, while Bamboo.com used a rotating video camera. IPIX, based in Oak Ridge, Tenn. was already tapping into other markets (commercial real estate, travel, hotels) and selling its camera kits. Bamboo.com, meanwhile, sent out its own photographers and was capturing only residential properties.

Bamboo.com and iPIX then decided to throw down their marketing campaigns and become one. Their technologies were combined and the $99 version has become the standard for typical homes. iPIX now maintains relationships with major real estate websites include Microsoft’s HomeAdvisor, HomeSeekers.com, Homes.com and Realtor.com - the official website of the National Association of Realtors.

What’s next? The online tools just seem to keep coming and coming.

Previous columns:

• HUD forced to police its own programs, 05-25-2000
• New factors in local housing market, 05-18-2000
• HomeSeekers building a name for itself, 05-11-2000
• Auctions can offer speed, efficiency, 05-05-2000
• Did Dad spend property taxes on basketball trip to Tucson?, 04-28-2000
• Continental name change severs a bond, 04-14-2000
• Home office may bring deductions, 04-07-2000
• Many professional, personal memories Kicked up with the Kingdome dust, 03-31-2000