Modern technology hasn’t just made it cheap and easy to work from home – it’s also made it potentially more lucrative than the traditional office-based model.
Working from home is still a niche practice, but one that seems to be growing in popularity. Some real estate professionals enthusiastically spruik this model, although nobody suggests it would work for every agent or business. For some, a shopfront provides essential visibility and credibility; for others, it’s the most practical way to bring together a group of people.
However, running home-based agencies is a viable alternative for sole traders, or even small teams. Thanks to the wonders of modern technology, setting up shop in a spare bedroom has never been cheaper or easier. Intriguingly, it could also be a more profitable and less stressful way of doing business, according to three agents consulted by REB.
Establishing a ‘virtual office’ can be done within days and for no more than a few thousand dollars. The list of requirements is minimal: chair, desk, phone, computer, internet connection, copier, printer and scanner.
Once the upfront investment has been made, the overheads are minimal – phone bill, internet bill, paper and toner. It also pays to have an outside IT consultant on hand to handle any technical issues that may arise.
Location, location, location
Sydney agent Peter Brack speaks from experience when he says the placement of a home office is just as important as its contents.
“For your own sanity, I think you need to have a dedicated space so that you have that mental break that tells you, ‘I’m going to work, I’m going to my office’,” he says.
“At the same time, you have that mental break when you finish. You leave your dedicated space, you close your door and you say, ‘I’m now at home’.”
Mr Brack understands the psychology of virtual offices – he spent six years working from home in his previous career, and then continued working from home after founding Radar Properties in 2013. (In September, he moved into a shopfront after rebranding as Century 21 Radar Properties.) The key to being motivated and productive, he says, is to treat your home office as an office rather than a home.
That means creating a business routine so you don’t succumb to the temptation of dealing with personal issues or household chores.
“It’s very hard in the first couple of months, but then when you realise that if you don’t work you don’t eat, you become motivated,” he says.
Less stress, more money
After five years as a franchise agent, Shane Evans has spent the past five years running Finesse Property from his Gold Coast home. He describes his three-staff agency as a “tremendously lean” business with low overheads and high margins.
“I pretty much know what it costs me per month to the cent to run the company, and it's not expensive,” he says.
“To run the company for the entire month costs me about somewhere between $18,000 and $21,000 a month. That includes two full-time staff [who work remotely], all my subscriptions for the major portals and subscriptions to all the major suppliers.”
By minimising his expenses, Mr Evans says he also minimises the urgency to win business. “I’m able to walk away from listings. I've said 'no' to a client recently and that's fine,” he says.
‘Why am I paying rent?’
Shiree Kay, who works in the Dandenong Ranges under the One Agency brand, actually ‘closed’ her virtual office for a seven-month period earlier this year when a shopfront fell into her lap. However, she reassessed her situation when the pizza shop next door showed interest in her premises.
“I thought: ‘Why am I paying rent?’ There are overheads and I’m not there all the time,’ she says.
“I do business in coffee shops where I write up contracts, and I find that doing it that style is a very neutral territory. You get a whole lot more out of the buyer because their guard is down as opposed to coming to your office.”
Ms Kay, along with Mr Brack and Mr Evans, acknowledges two drawbacks that come from not working out of a regular office. The first is not being able to socially interact with colleagues. The second is a nagging feeling among some vendors that there must be something wrong with an agent who doesn’t have a visible public presence.
Mr Brack says he always had a comeback when vendors queried why they should do business with someone who didn’t have a shopfront.
“I would simply say to them, ‘I’m meeting with you now in your home – do I need an office for that? When I meet buyers and I conduct open homes – do I need an office for that? So what’s the big deal?’”