The Impacts Of Information Technology On Real Estate Brokerage In China

The Application of Information Technology (IT) has great impacts onReal Estate brokerage, both from inside and outside of the industry. Frominside, IT has enhanced the efficiency of brokers and brokerage firms andbrought more competition into the industry. From outside, For Sale By Owner(FSBO) on the Internet greatly challenges broker's position in value chain,and even could lead to broker disintermediation. In China, brokerage industryis using more and more IT, although still in a relatively low level. At the sametime, the kernel competence of the industry is information, not service. Thebroker's position in value chain is vulnerable facing FSBO.It is in this context this dissertation research IT application inside theindustry and the threats of FSBO to the industry. In the theoretical part, basedon the available literature, the paper examines the mechanism of ITapplication in the industry and the impact of IT on the industry. In theempirical part, the paper first analyses the actuality of IT application in theindustry through case studies and survey of brokers and brokerage firms ineight major cities of China. Then based on the data of house buyers inGuangzhou from a questionnaire survey 2004, the paper employs binarylogistic model to analyze the tendency of buyer's choice of FSBO.The empirical results are: ① Chinese brokerage industry has not makefull use of the internet as a marketing tool;brokers' usage of IT is at very lowlevel;but brokerage firms have made relatively good usage of IT. ② Buyershave obvious tendency of FSBO;FSBO has a noticeable potential in China;brokers' service does not satisfy buyers, the industry does not have a stableset of customer.Finally, some suggestions are presented aiming to change the kernelcompetence of the industry to retain its position in the value chain.