There are so many industries going through some form of disruption at the moment and real estate is no different.
The internet has enabled a shift in the way we do business and although there are opportunities there are also pitfalls to avoid.
While One Agency has created an accessible platform that’s built to last ‒ by offering benefits to real estate agents and home sellers alike ‒ other companies are venturing into the field with less due diligence.
The idea of making a quick buck or offering a service that cuts corners means that many have been set up to fail. Principals and senior real estate professionals should take care before committing to a new venture. In this post, we take a quick look at some newcomers and offer our observations on three of them.
Are novelty or low-cost real estate agencies disruptors or passing fads?
Over recent years, a number of what I term ‘novelty’ real estate franchises have entered the market. Some haven’t made it to Australia yet but it’s only a matter of time.
We have the real estate agency riding on the back of home services. According to The Australian Financial Review, the joining fee is high, as is the cost per lead and monthly fee. So how well will it do as a franchise model? It will be up to the real estate agents who join, how much effort they put in and whether or not the leads are quality leads.
There’s the magazine and TV lifestyle program spin-off. This one trades heavily on its presence in traditional media. So real estate agents who join will get good brand recognition but it might come from an older demographic. This is possibly why uptake since launch in Australia has been slow.
One of the major fine arts auction houses has added international luxury real estate to their stable. This business is targeting the ultra-wealthy globally. How will they do in Australia? We haven’t had time to observe so can’t offer any pros and cons. However, what I can say from over 40 years of experience in the Australian market, the luxury consumer market is so niche, with so few properties on the market at any one time, I wonder if it’s worth their while to have a presence here.
It sounds great for the home seller; pay a flat fee so you have certainty around your costs. The problem with the flat-fee model is that usually the seller pays the real estate agent the fee up front. There’s little incentive (apart from getting referrals) for agents to spend too much time trying to sell a property; they get the fee even if the property fails to sell.
In my observations, real estate agents working under a flat-fee model need a high turnover to be able to earn a decent income. Given our cooler capital city market conditions, this has led to an early exodus of real estate agents looking for better deals with other companies.
Although One Agency fits into the low-cost spectrum for agents, it offers a much fuller service. Using a mix of traditional and online marketing strategies, One Agency has become the region’s fastest-growing real estate agency network for one simple reason ‒ it works by allowing principals to keep more of their earnings. Real estate agents across Australia and New Zealand are quickly cottoning on to the benefits, especially the supportive environment and the advice for containing costs.
Find out more about One Agency and how it can transform your career and business. Use the form below or call 1300 792 388 to speak to our team.
As founder and CEO of the fastest growing real estate network across Australasia, I offer real estate professionals an opportunity to reap the financial rewards of going it alone with the security and clout of an established brand. Talk to me and my team about your options.
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