As agents or other professionals within the real estate industry, many of us have had the opportunity to learn from valuable mentors.
The value of mentoring is based in sharing — allowing someone else , whether they have less or just different experience — to benefit from your wins and learn from your losses.
In February, we introduce our ‘EAC Intel Series’, a monthly article, video or live feed designed to share the experience, insights and intelligence that our directors have gained during their time in the industry.
In March, you’ll see our first director’s feature piece, so keep an eye out. In February, our directors have taken the time to each share a short piece of intelligence that will help guide you through a year of change and challenge.
Will AirBnB replace holiday letting agents?
Technology will change the way we facilitate real estate transactions, and if agents resist, rather than embrace the opportunities presented to them, the real estate profession runs the very real risk of being left behind.
Holiday letting is a specialisation within the industry that perhaps, to date, has been most challenged by the arrival of new technology and unique business models. In addition to the now older bookings sites like booking.com and stayz.com.au, it now finds itself competing with global giant, AirBnB, which has effectively aimed to ‘uberise’ real estate.
Lois Buckett, agency principal in Lennox Head and EAC director, implores agents to capitalise on this change rather than fear it:
“Online bookings now come through booking platforms, which are instant,” she says. “At our agency, we operate through a system called yesbookit which also integrates with sites like www.booking.com, www.stazy.com.au and www.AirBanB.com.au, among others.”
“With the arrival of the likes of AirBnB to our market, a lot of our competitors are worried about losing business, however we see these challenges and other similar models as an opportunity to provide extra service and extra exposure for our holiday guests and landlords.”
“Make no mistake, there are challenges which we are all facing with the terms and conditions of AirBnB that don’t marry nicely with our standard terms and conditions, but ultimately, an agency that adapts to these new opportunities and embraces them, will have more longevity and future security than one that doesn’t.”
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How will ‘sell your own’ sites impact sales?
It’s no secret ‘sell your own property’ sites have been popping up here, there and everywhere over the last few years.
And while so far, they have managed to secure only a tiny portion of market share, as per Lois’s advice, if agents don’t adapt and offer similar technology, combined with excellence in service, we may find their share of wallet growing significantly and rapidly.
Agency principal and EAC director, Bruce Styles, notes while regulations seem to be tightening for agents at the moment, the same can’t be said for ‘sell your own’ options, which may leave sellers out of pocket and unprotected.
“Consumers who avail themselves of the services of these providers do not receive the protection or hands-on experience offered by the traditional agent,” says Bruce.
“While the apparent savings offered by the private sale of their home appear to be worthwhile, the harsh reality is, in many cases, the vendor does not receive the same level of competition and subsequent higher sale price they would receive if they used a reputable agent and followed their advice.”
“This is a situation which is exacerbated by the current softening of the market and the increased diligence of finance providers resulting from the Royal Commission into the finance industry. Banks have tightened up their lending criteria and that has led to a slowing of sales.”
Both sellers and buyers should exercise caution and do their due diligence when selecting their approach to sales, and certainly consider both the financial and legal implications of ‘sell your own’ options.
Similarly, it’s important agents understand the motivations behind such choices and begin to evolve their service to incorporate more and better technology that can continue to enhance their communication, transparency, marketing and approach.
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Could a focus on quality minimise time without tenants?
As property prices increased in many locations throughout Australia over recent years and lenders tightened up their practices, some parts of the country started to see a shift in the balance between home owners and renters.
With more than a third of Australians now renting and looking to do so for the longer term, tenants aren’t just aiming for a place that will ‘tick the boxes’ for the moment, they are seeking a place to call home… and that includes all the bells and whistles!
“Despite a soft market in greater Sydney, good quality properties that are priced correctly are continuing to lease well. However, with the market swung in favour of the tenant, we are seeing an increase in tenants’ expectations for desirable features from potential properties,” says principal of Aspect Real Estate and EAC director, Elizabeth Sargood.
“Things such as air conditioning and quality fittings and fixtures can now be the difference between securing or losing a quality tenant.”
This is a message to all investors, whether in Sydney or beyond: renters may be looking for more. To minimise losses and time without tenants, keeping a property in good condition, updating its interiors and fittings, and offering the potential for a real ‘home’ may be beneficial.
For agents struggling to shift properties, keeping trends like this in mind can also help you improve your service. Being able to share insights like these and coach landlords so they achieve better results can make your service truly invaluable and help secure future business.
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Spotlight on regional property: from the east to central west
As the real estate selling season for 2019 has slowly swung into action, newspapers and other media outlets are still screaming ‘the sky is falling’ and focusing on negative predictions that can and do affect the mentality and confidence of potential buyers and sellers.
But if we look outside the major cities, towards central NSW, some markets have bucked the odds, by continuing to grow and offer a lot of opportunities.
“In Orange, NSW, the first home buyer or first-time investor market has seen steady increase in demand and pricing over the last 12 months without any lessoning value,” says principal of Toner and Associates, and EAC director, Greg Toner.
“Properties in higher pricing brackets have also seen slight price rises over the last 12 months and steady demand. The highest demand sector is for the centrally-located, period-style, brick homes which have been renovated.”
“New land estates are still selling well and spec builders for the first home buyer market area are active. The average residential block price is around $160,000, which has remained fairly static in the last 12 month period. Hobby farms and lifestyle blocks within a 15-minute drive to Orange are still in high demand but values have remained fairly static in the last 12 month period.”
“Orange enjoys a very buoyant health services sector and a still buoyant mining sector which ensures good employment opportunities. The outlook for the Orange real estate market is a steady demand over the next 12 months with a levelling out of values at the higher base which occurred in the latter part of 2017.”
From the central west of NSW, all the way back to Dapto near the east coast, and Michael Garside, principal of Harcourts Dapto and EAC director, also sees some potential for growth in 2019.
“We have a large mix of young first home buyers and families, and our area is popular for investors as well.”
“As with the Sydney market, our area has seen a decrease of approximately 10% from the highs in 2017. The next 12 months may see the prices levelling out, however, the outcomes of state and federal elections this year may affect pricing.”
“At the moment, we are seeing better numbers through open homes and a bit more activity than we saw in November and December of 2018. Vendors that are realistic and price to the market correctly are seeing better numbers and having less days on the market.”
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To learn more about our directors and their experience, visit the EAC’s about us page. Keep an eye out in March 2019 for articles from our other EAC directors: John Oehlers puts the spotlight on the Tamworth market, and John Sercombe takes an interesting look at real estate’s past and predicts its future!