There was an article this morning in the, the Phoenix Business Journal, (sub. required) that talked about a housing related "service." The website is called swapyourhouse.com, and it claims to be re-inventing the way we buy and sell real estate. Thats the headline on the website, at least. Actually, it is not a reinvention of any sort.
Being an economist, I found the site interesting for two reasons.
1. The use of Barter
2. Another demonstrated use of the internet
The use of barter is indicative that there is insufficient capital in the system and that the money system has broken down. Similar things occurred in Russia after the ruble crisis of 1998. The currency in use no longer served as a store of value, which led to it no longer being an effective means of exchange. Barter, which is demonstrably less efficient than a monetary transaction only comes into play in modern times when the money system breaks down. My guess is that in places like Zimbabwe, where the money system is broken (because of government action), barter goes on quite frequently. In real estate, the transaction market has become decidedly less liquid, particularly here in Phoenix. In other words, at the current pricing levels, there are not enough buyers in the market. Sticky pricing prevails, and hence the supply of homes, at a given price is above the market clearing rate. The bargaining comes into play because there isn't sufficient capital for these particular buyers and sellers and the transaction market doesn't move fast enough. Its interesting, because its an inefficient way to transact. WHICH, brings me to point #2... the internet.
By now, everyone has read posts about the internet and real estate, and how it changes everything. Sure. Old story, lets move along right? The oft-overlooked thing about the internet is that its greatest power is in lowering the cost of information. The dramatic effect this has had on the consumer market is evident in shopping comparison sites. It has also had an effect on the auto industry, and now it is rolling into real estate. Greater competition, and more information at effectively zero cost has reduced the value of the services that agents provide. This is the biggest effect that this site will have. The swapping is of no consequence, it is the service based pricing, that will effectively undermine the current real estate agent pricing structure. Successful agents in both commercial and single-family will need to identify how they provide value to the seller, beyond throwing things up on the MLS, which is losing its information monopoly to sites like trulia and zillow.