A REINSW panel has addressed the need for quality PMs to ensure real estate offices survive lower fees.
“From a business owner’s point of view, if you have a business model which is fee-for-service and that is dramatically cut, you’ll end up with a different business and a different landscape and, I think, we’ll end up with a vastly different industry,” BresicWhitney director Shannan Whitney said at the panel discussion.
The panel discussed the new landscape that would exist in traditional real estate offices and where sources of income could be found if the reliance on fees was lessened.
Property management is one area of real estate that is often discussed, with agencies saying they are increasing their rent rolls to provide steady income during times of disruption and uncertainty.
“Certainly in our business, we’ve started to talk about what we will do if fees are 1 per cent, how will we make money?” Morton Real Estate managing director Ewan Morton said.
“I think that’s a question everyone in the industry needs to ask. People are holding their houses for longer, so we could be the best prospectors and nurturers in the world to hold on to that relationship for 20 years. Now, we need to ask the question of what else we can do with that person over that 20 years, with the end game being them selling the house.
“Finance, buying, investment, property management, utility connection, renovation and the last thing you do for them is you sell the house. We own the customer relationship and that’s why we’re still here. They haven’t disrupted us yet.”
Good PMs are becoming more important in large offices that are struggling with decreasing sales transactions and are seeking other revenue streams.