Three events in the last twenty years have been catastrophic enough to displace the REALTOR® as the first point of contact for the real estate consumer.

The first was the devastating report issued by the Federal Trade Commission in 1983, which exposed the duplicity of sub-agency. The effects of this report are still being felt today in the continuing mistrust of the general public and its eagerness to try alternative methods of home buying and selling which exclude or limits the role of the agent.. Every time a buyer or seller transacts a home without an agent, they exhibit lack of appreciation for what the real estate professional can do for them. Confusion over who represents whom in the transaction only adds to the problem. The evidence of this is how many people go to the closing table unrepresented, even though they have already paid for it within the listing broker's fees. As long as three out of five sellers consider selling their homes themselves, and over half of buyers go to the closing table unrepresented by an agent advocate, the real estate industry continues to be vulnerable to disintermediation.

The second event is the development of the Internet. The Internet has changed the way consumers interact with service providers, putting buyers more in control than ever before. Easy Web surfing means that consumers can enter or leave an Internet site in seconds, as soon as they have satisfied their curiosity, placed their orders or when they become bored. Judging by the top ten most trafficked portals, including Realtor.com, AOL, Lycos, Excite, and Netscape, consumers are more inclined to browse the megasites, which offer a variety of compelling content and services, suited to the multi-tasking lifestyle of today's busy consumer.

Not only is the one-stop-shop a threat to Realtors and their value to the transaction, the Internet has also allowed industry outsiders to develop new services for real estate consumers which also move the Realtor to the back of the line. Mortgage companies, with large budgets to advertise and make strategic alliances, are making it easy for online consumers to be prequalified. Although all of these Internet startups have differing business models, they each are taking a place in front of the Realtor, and the more distance there is between the Realtor and the consumer, the less likely it is that the Realtor can demand full price for their services.

The third event is still in development, but it is already impacting the lives of Realtors online, and that is the technology which will enable the online paperless transaction. Lenders, title companies, attorneys and other online-enabled closing agents are moving from the closing table to the front of the transaction with transaction management software. For proof of the development, look to the insurance industry. USAA has offered home mortgages for some time, and offers to help borrowers "find a home." State Farm Insurance has recently acquired a federal banking charter, and will soon offer loans of all kinds, as well as personal finance management products. It isn't much of a leap to transaction management with all the fulfillment being routed through State Farm's local and national branches.

Already emerging from the primordial technological ooze is the next generation in the survival of the fittest - the superagent. These are agents who are skilled in computer sciences and have broker's licenses, law degrees and/or mortgage broker licenses, and who can literally handle the real estate transaction single-handedly.

How are these three events related? They have each contributed to the Realtor's losing his/her position as the first point of contact for the consumer. After the consumer has already found a home and secured a loan, what can the Realtor do to add value to the transaction? That is the question that will define the industry in the future, believes one broker.

Ed Krafchow is the president of Prudential California Realty and Nevada Realty (Northern California) , a network of 110 offices, over 3,000 agents and the 12th largest brokerage in the United States. Krafchow's biggest concern about the future, is not so much the interlopers, but the fact that other brokers in the real estate industry itself are doing so little to prepare for the coming Armageddon.

"You have to pay attention to the general trends of business," warns Krafchow. "Customers want freedom, speed, and immediacy. I am 57 years old and using an agent to sell my home, but a 25-year-old may not see it the same way.

" The current service component isn't adequate for them," explains Krafchow. "The transaction is so cumbersome, that I don't think the client experiences anyone at the center of the transaction. No one knows where it is going at times."

Krafchow says that he sees the brokers' value in processing and technical work. He forecasts, "Browsing has already come to the Internet. The transaction will be the next piece to move toward the Internet. There are experiments taking place with e-companies. We need to reengineer and reinvent ourselves."

To position his firm, Krafchow has spent several million dollars on a transaction management platform, designed to "put back room functions up front and online for brokers, agents, consumers and all transaction contributors to see. He is negotiating with Homebid.com on a means to put the agent back at the center of the transaction with online offer management.

"We are abandoning our back room and old legacy software," says Krafchow. "The consumer will be able to see where they are in the transaction without calling the agent."

The consumer will have prompts which will ask for certain information and documentation so that each step of the transaction can proceed quickly to fulfillment.

"Whether you are looking at any technology , it had better relate to service," Krafchow suggests.

Other assistance to Realtors is also on the way. The NAR and national MLSs are working on transaction management platforms which will feature a universal Internet language called XML, enabling Realtors and other service providers to share documentation online without conflicting protocols. Emails which don't open will be a thing of the past. Documents lost damaged or incomplete will be no more. Transaction management in a secured environment will put the Realtor back in the center of the transaction.

The e-PRO certification of qualified Realtors will go a long way to show Internet savvy consumers how the industry is adapting to the still fledgling e-commerce environment.

All that remains is how the Realtor will demonstrate value to the Internet-enabled consumer.