In February 2004, five entrepreneurs met up in a San Francisco suburb and spent a long weekend thinking up ideas for a new technology venture.
“We knew we wanted to start a company, but we didn’t know what we wanted to do,” said Owen Johnson, a participant in the retreat. One of their 100-some ideas was to offer Web-based products for people who manage their own properties.
How did they choose that particular concept?
The entrepreneurs learned from U.S. Census data that about 20 million Americans manage between 10 and 50 properties, said Johnson. That information, he said, revealed a market large enough to make the idea a business success. And the lack of any Web site dedicated to this sizable group of landlords made the concept a natural.
In fact, the Web’s popularity among real estate investors and consumers has given rise to two local companies that seek to capitalize on the trend: Johnson’s Investment Instruments Corp., based in Beverly, Mass., and Location Inc. in Woonsocket.
Andrew Schiller, chief executive of Location Inc., said he wishes he could have used his company’s neighborhood search engine before he bought a home in Worcester five years ago.
When he completed the search engine, NeighborhoodScout.com, he used it to compare his ideal community to the one where he had moved.
“As soon as I put in my criteria and let the search engine operate, I was like, ‘Darn,’ ” he said. “If I had known, I would have bought about a mile away. I would have been in a neighborhood that goes up in value faster, and I would have been in a better school district.”
Yet Schiller was like other people, he said, who think they know enough about a community after talking to people or reading about it.
NeighborhoodScout.com, asks users to enter their ideal location, price range for housing and other criteria they can denote with adjectives such as “artsy” or “urban.”
The search engine can also help users find pre-screened real estate agents in a particular area or figure out where to get financing for a home.
Schiller, who has a doctorate in geography, cited several statistics he said indicate an acute need for his Web tool.
The National Association of Realtors, he said, reported in 2005 that 74 percent of potential homebuyers used the Internet to search for real estate, compared with 52 percent in 2001. And in 1995, he said, just 2 percent of buyers used the Web to find a home.
What is more, he said, people are moving greater distances now than any time since the 1950s, when the Census began tracking such information. The trend has drawn more people to the Internet to learn more about places farther from their current homes.
Location Inc.’s neighborhood search engine recently has gained acclaim on several fronts.
Barry J. Glick – the founder and former CEO of Mapquest.com – became head of Location Inc.’s board of advisors last month, saying in a statement that NeighborhoodScout.com “should be indispensable to the millions of annual homebuyers in the U.S.”
The search engine also was lauded for its high utility to consumers in this year’s edition of “Home Buying for Dummies,” a how-to guide for people entering the housing market.
Schiller said the search engine gets about 100,000 visitors every month, yet he still believes he needs to improve marketing to increase those figures. Many well-known real estate search sites, he said, generate anywhere from 2 million to 11 million visitors per month.
The fee to use Schiller’s search engine is $19.95 per week; a lower per-week rate is available for longer periods of up to a year, which costs $99.95.
Meanwhile, Investment Instrument Corp.’s Johnson said that his company’s Web site for small-scale property managers, iiProperty.com, is in its second phase of testing. Though he would not give specific figures, he said that “thousands” of people use the technology.
The iiProperty site enables people to track leases, rent payments and invoices for their properties. It also allows users to create their own Web site to display their listings; send tenants notices, via e-mail or the U.S. Postal Service; and perform bookkeeping tasks.
Those services are free, but other services will be offered for a fee, Johnson said.
“One of the key things for people in our market is cost is a significant factor, because right now they can hire a property manager to perform services that [iiProperty.com allows them] to do,” Johnson said.
“We really saw an opportunity that has really come about in the last few years,” he added, “because people of all ages are really doing so many things, such as banking, online.”
Johnson should know. In addition to creating Investment Instruments and iiProperty.com, he is the founder of a social networking Web site, connectprovidence.org.