Housing agents turn to internet

China's major cities have seen real estate trade volume shrink drastically in recent weeks. Many housing agents have had to shut down some of their branches to reduce costs during the downturn. Some are turning to the internet, where costs are much lower, to revive business.

One of Beijing's largest real estate companies opened 1000 internet stores in a single day.

On Tuesday, one of Beijing's largest real estate companies opened 1000 internet stores in a single day. Clients can log on and communicate with online agents, without having to visit a branch to get the basic information they need. The company says the major reason for the shift in business strategy is lower costs.

Yao Jiajia, Deputy President of 5I5J Real Estate Company said "The budget for a 100-square-meter store is 50,000 to 60,000 yuan per month. But, an internet store can reduce costs by as much as 80 to 90 percent."

Industry insiders say in the past two years, real estate companies have been scrambling to open outlets in the fight for more market share during the real estate industry's red hot period.

But government control policies have dampened market demand since the fourth quarter of 2007, with transaction volumes shrinking drastically. Real estate companies have had to close many of their branches. Major cities in the country have seen tens, even hundreds of outlets close down.