What initiatives has Raine&Horne focused on this year?
We’ve just rolled out our national advertising campaign. There are four animated TV campaigns that are 15 seconds each in length and bring the ampersand in ‘Raine&Horne’ to life. They touch on certain key elements as to why people sell because our major issue around Australia is listings. It’s all about selling and driving the phones in our offices to ring, so it’s very exciting and it’s got some really positive feedback.
We have gone back to basics with this campaign. Television is a medium we haven’t used for several years and I think we’re the first national group to really embrace it again. Even though it’s only been two months, it has received great traction so far.
What are your plans for expansion in Australia?
Around Australia, we have 300 offices. Our biggest state is New South Wales, closely followed by Queensland. It’s fair to say Queensland is our major focus at the moment. We bought the master franchise back several years ago and in Queensland, a lot of those markets have been to hell and back.
They really have had a tough time but there are some green shoots growing there, particularly in south east Queensland, which is really good to see.
We recently opened our 15th office in Brisbane. It is a market that is moving in a northern trajectory, which is great, but it really is a market the previous master franchise hadn’t concentrated on. They were a major regionally-based franchise network, but it stands to reason that, as an international brand, we have to be in Brisbane.
What are your thoughts on the Gold Coast market and how it is tracking?
I think it is a great litmus test to see where the Australian market is tracking. The Gold Coast market is mainly an investor market. It’s an aspirational market and it’s a market driven from the southern states in Sydney, and more so from Melbourne.
I think the buying opportunities in the market are amazing. You can buy a unit for a couple of hundred thousand dollars, and it leases very well – the Gold Coast economy has matured. Fifteen to 20 years ago, people living in the Gold Coast were not from the area. Now, the Gold Coast has its own community and it’s growing. There are universities and there are employment opportunities, so there are a lot of ticks in the boxes to invest or to live there, which drives the property market of course.
Raine&Horne is obviously one of the biggest real estate networks in Australia. How do you differentiate yourself from your competitors?
One of our major points of difference is we’re 130 years old, and still family-owned.
But also, we offer our principals direct access to management through our executives and myself. You don’t have to go through six different people.
It’s not like ringing the prime minister up; you go straight to me if you need anything, so I think that’s the big point of difference.
In addition, we are debt free, there’s no turmoil, we can get things done very quickly and if we make the wrong decision, we can undo it very quickly. Not many companies can say that.
How does Raine&Horne interact with international buyers?
We have offices in the UK, but internationally, we are a real ‘Asia-phile’ company and we have by far been the pioneer there. We’ve been in Malaysia for over 30 years and we’ve got 12 offices there. We’re in Hong Kong, Dubai and Fiji, where we are the number one agency. We’re just about to open offices in Beijing and Shanghai in the next two months, and they will be run by three Aussies. They’re expats who have been there for up to 15 years and are fluent in Mandarin, so they know the market intimately. Our aim is to sell Australian properties to the Chinese market.
Locally, some of our larger offices have got a ‘Chinese desk’ to cater to Chinese investors. This is a new initiative despite the fact Asian – particularly south east Asian – investors have been in Sydney for 30 or 40 years, largely in the prestige end of the property market.
This year, there has been a lot of press about Chinese money flowing into the country, and for a country of 23 million people, we need foreigners buying prestige property – there are only so many Aussies who can afford a $15 million property. We really need international players to come here.
Do you think these international players make it harder for local buyers, particularly first home buyers?
The major issue for first home buyers is that they’re competing against a lot of investors who are currently scurrying around the market. I certainly think the first home owners’ scheme has probably sucked up three or four years of demand from first home owners, and the investors are filling that void.
What sort of impact do you think the upcoming election will have?
It’s certainly going to have negative implications for agents over the spring selling season because sellers are going to sell or just wait. I think if the election date gets pushed out, people will still be selling into January 2014.
Traditionally, January is quite a slow period and we’ve only seen it pick up once before in the Sydney market, following the Sydney Olympics in 2000.
That event had the effect of pushing spring all the way out until the following year – and almost into the next January. Overall, I think the election is going to delay spring.