COMMENT
Strewth mate!’ Richard Rawlings reports on his speaking tour of Australian estate agents.
W
hen I was approached to present a series of addresses and training seminars across Australia, I jumped at the
opportunity. However, I was worried that my contribution might miss the mark; what do I know about agency Aussie-style? I set to work researching the market,
speaking to estate agents at random in the middle of the night (11 hour time difference) and seeking to gain some understanding of the issues facing Australian agents. I was also mindful that Brisbane on the east coast for example is some 2,050 miles from Perth in the west and has subtle differences in their agency style. I was relieved to find that the threats
and opportunities experienced by agents in Australia are almost identical to those facing British estate agents – vendors wanting too much for their property compounded by competing agents pricing too high or undercutting fees, and mortgage valuers killing deals with a more cautious approach to pricing. Like the UK, Australia has seen a
massive boom followed by mild annual falls in both volumes and values, tempered by a stronger market in Sydney as we have seen in London. The price of an average property in Australia’s main cities is now some 34 per cent higher than the UK average, thanks in part to the ever- strengthening Australian dollar. The global financial crisis has tempered the market, with prices down up to 25 per cent from their 2008 peak although mortgage funding, partly underpinned by the government of this natural resource-rich country, has generally remained readily available. But Australians are an upbeat, resilient and progressive lot and I sensed an energy that seems to shake off even the direst of economic predictions.
50 JUNE 2012 PROPERTYdrum
‘Opportunities and threats are identical to those you face.’
WHAT OF AGENCY TECHNIQUE? Their use of open houses and auctions is well developed and agents in the UK can learn from this. Client-paid advertising has allowed many agents to continue to promote their business as well as their stock beyond what’s possible in the UK. They use binding contracts of sale as a matter of course, yet I know only a handful of UK agents who have embraced this significant opportunity. Some Australian agents have been slow
to diversify into lettings which as we know in the UK can take some time to establish and requires different skill sets from sales. Other areas that appear underdeveloped in agency in Australia, in my opinion, include long sole agency periods (many state 90 days) although a few agents do offer a “no fixed period” service with 14 days notice which is much more customer focused, professionally attractive and can make sound business sense when withdrawal fees relating to advertising costs are applied. There is no multi-listing system to speak of and only a few agents offer a buyer representation service. One important opportunity that many
agents in both Australia and the UK seem to be missing is to have developed
marketing that promotes their agency rather than simply the stock they are selling. As in the UK buyers are mostly sourced online, yet vendors still need to be impressed, influenced, inspired and persuaded using the local paper, mailers, newsletters, social media and other marketing initiatives. I saw very few agents claiming the upper hand in their market. Estate Agency is highly regulated in
Australia, with regional variations; we are fortunate not to be subject to the same controls here. Interestingly, in Queensland, agency fees are capped at 2.5 per cent (with 15 per cent on the first £12,000 of the transaction) which actually seems to make it easier for agents to charge this amount, with cheap agents less of a threat. However, in Western Australia, I spoke to two agents who charged 2.5 per cent and 4 per cent respectively. Both offered a similar service but the higher agent had the confidence to charge more. I have been asked to return to Australia later to run “Raising Fees Instantly” seminars, demonstrating that the fee issue is not only limited to the UK, but is just as relevant at higher commission levels as it is at our pathetically low ones. One thing is for sure – whether you
work in the UK or Australia – when there is less pie to go around, the table manners change. Lower volumes are forcing agency standards to rise (or fall) and innovation in agency technique and marketing methods are accelerating. In an environment where “good” is the new norm, the agent who demonstrates clear distinction and a no-nonsense approach will secure the lion’s share of the market, irrespective of property values and volumes.
www.EstateAgencyInsight.co.uk
Do you have any views to share?
www.propertydrum.com/articles/Aussierules
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68