As 2020 draws to an end, you would have to admit that it has been a year that will be studied and written about by historians, social commentators and cultural observers for decades to come.

And I confess, I am a history buff who sets out to see how the past affects the present.

It’s about whether or not lessons have been learned, social and political movements have been banished or resurrected and the actions, inactions and motivation of people that drove them toward the destiny they sought.

To me, the moment in time we share right now is possibly one of the most culturally, economically and socially defining of our lifetimes – and those of the next couple of generations.

For those who have taken notice of or studied recent history – years such as 1913, 1914-1918, 1929, 1939-1945, 1969, 1989 and 2001 – have provided significant events that shaped the immediate futures of individuals, populations and countries.

2020 could top them all.

I knew this was going to be the case when the threat of a virus pushed scores of Governments world-wide to lockdown (simultaneously) their people to ‘protect’ them, whilst bringing their respective economies to an almost grinding halt.

Millions could die, health service overwhelmed – the consequences of inaction were too much for many to bear.  Did Armageddon arrive? I’m still waiting!

The narrative was repeated over and over; Stay Safe, Stay at Home, Get Tested, We’re all in this together – the fight was on for our very survival.

The lockdown provided me with an opportunity to look for the answers to two simple question:

Why? And…

Who might this benefit?

Within three weeks I had my answers and the information just came to me thick and fast.

What did I find out?

That’s something I might share down the track. But some people already know through interesting one on one conversations over the last 9 months.

Ok, what does this have to do with the property market?

A fair bit.

Already we are seeing significant ‘migration’ from larger urban areas such as Sydney and especially Melbourne.

City dwellers are looking toward regional and country areas for the ‘quiet life’, removing themselves from lockdowns and restriction of movement.

With remote working becoming almost the norm during the last year, you can run a business from anywhere as long as you have a laptop, phone and solid internet connection.

However, early on in the beginning of the ‘pandemic’ the prophets of doom had the property market crashing by 20-40%, when in fact some areas in Oz have seen price growth of 20%+ in just a few months.

The flight to bricks and mortar has been significant – and should remain consistent for the time being.

For those of you who follow Philip J Anderson’s 18yr property cycle, you’ll know the current trends are not a flash in the pan.

From the point of view of AIAB, we have seen our members sell property to the value of around $65million with savings of over $1.6m.

We anticipate more of the same in 2021 and beyond.

I know we are all hoping for a change of collective luck in 2021, but whether or not the new year provides a reprieve from the dramatic events and changes we have seen and endured, appears to remain in the hands of a few who seek greater control of the many.

We wish you and all your families a peaceful and joyous Christmas, and a prosperous new year.

Thank you for supporting Agent in a Box.

 

 

I have no doubt your inbox has been groaning under the weight of ‘virus’ do’s and don’ts; tips on how to ‘stay safe’, how to build an online business, what the world will look like in six months…

The opinions on who is to blame, why it happened and how it can be sorted are enough to make your head explode.

Couple that with the fear that our friends in the mainstream media can effortlessly instil, and you have the cocktail not just for confusion, but physical and mental breakdowns that are far less easier to measure than the stats that engorge the media landscape in relation to how the ‘virus’ is doing.

You’ll notice I don’t, and won’t, use any of the terms or anachronyms that identify this event, because each day they are used thousands of times over on MSM and social media to keep your fear and uncertainty redlining.

No, this is not going to turn into an opinion peace, but all I can say is that during this ‘lockdown’ (a term exclusively used to describe keeping gaol prisoners under control during a ‘dangerous’ event) I have dug very deep into the ‘Why?’ and ‘Who does it benefit?’

I am always looking for the upside.

This event has polarised the public unlike any other in recent history.

You either believe the danger, have some gut-feel doubts or you are part of a growing number who believe it is being orchestrated to benefit a privileged few.

The one thing I find extremely hard to accept is the “we are all in this together” mantra.

No, we aren’t.

The martial law that has been so swiftly imposed limits human interaction apart from who you may be ‘locked away’ with…

Ok, I’ll stop there, I think it’s time to dive over to some observations and predictions (and BOY, there are plenty to choose from) for what might be in store for the property market.

I am always looking for the upside.

It’s not the strongest who survive, but those who embrace and recognise change is coming, then adapt to it.

After working for others for the previous six years, I started my first real estate business three months before the GFC hit in 2008. It survived and thrived, so I know how to help clients in tough times.

At that time, I knew the property and economic landscape would change, and that change was the tsunami of online business and trade.

And by learning about and embracing that massive shift, I was able to innovate and roll with the punches. It’s not the strongest who survive, but those who embrace and recognise change is coming, then adapt to it.

Fast forward to April 2020 and its on again!

Common sense! And remember – no Open Homes.

The real estate world is already adapting by utilising the tools that already exist and tweaking them to work efficiently within the current agenda.

Video tours, 3D imaging, online visual meeting platforms like ZOOM, online auctions…

Serious Sellers Always Attract Serious Buyers.

But you can still physically show another human (or two) through your property as long as you keep a safe distance – we always have – ask the potential buyer not to touch anything (you can open doors, cupboards for them) and have some sanitiser available for all parties to use before and after.

Common sense! And remember – no Open Homes.

Nearly four weeks into our ‘lockdown’ and buyer enquiries continue to roll in. Sure, numbers are down around 30-40%, in March we assisted with the sale of almost $10m worth of property, and already in April we are seeing reports from our members of deals being done.

Prices will come under pressure, but the advantage to that is, if your property has softened in value, so has the property you want to buy!

This confirms what I learned during the four-year downturn after the GFC: Serious Sellers Always Attract Serious Buyers.

Did you say four years?!

Yes, I did.  However, research based on cycles over the last 220 years (check out Phillip J Anderson) and my experience during the GFC, I would hope this event is part of the mid cycle blip that befalls the property/stock market.  It is not the end of the world, but to some it feels like it.

Prices will come under pressure, but the advantage to that is, if your property has softened in value, so has the property you want to buy!

People still have to, want to or need to move no matter what the current situation is.

Here are 7 Tips for getting through this event if you are selling or thinking about it:

1. As soon as an MSM news bulletin appears on your screen, switch it off.
2. Have faith that we will get back to some sort of normality quicker than you are being led to believe.
3. Be patient and keep your property placed as a competitively priced option for buyers.
4. When you get a buyer enquiry – engage that buyer. Talk to them, ask meaningful questions, do your best to relate to them and their situation.
5. If a proposed deal doesn’t feel right, don’t allow the current situation to pressure/influence your decision.
6. If you need to clear the clutter in your mind and re-focus, contact us – we are really good at helping with the right mindset.
7. As soon as an MSM news bulletin appears on your screen, switch it off.

I sincerely hope you, and your families, are coping and keeping your eyes on the prize (an end to this ‘thing’).

It WILL pass, but in the meantime, start scratching below the surface by asking ‘Why?’ and “Who benefits?” so you might be able to better understand the situation we have been presented with.

Happy Easter, stay well and be well informed.

AIAB

As of 25 March, 2020

To all current and future members of Agent in a Box,

You are no doubt being barraged with information regarding the current situation with the virus outbreak. Recognising this, we would like to keep this brief, yet as informative as possible.

We hope you are all safe, well and adhering to health guidelines.

As far as the real estate market is concerned, yes, it will soften in the short term with some buyers retreating until their circumstances and confidence return.

However, we continue to take and pass on buyer and tenant enquiry.  The market remains active.

As per the ‘recommendations’ of the Australian Government, you, as a property seller or landlord cannot, for the time being:

• Conduct Open for Inspections
• Conduct Auctions

One off/personal inspections with prospective buyers are allowable.

To help you engage buyers:

• Take the time to talk as much as you can via phone (preferably) or email to prospective buyers/tenants to determine their interest and motivation prior to making arrangements for them to inspect your property.
• Ask that prospective buyers/tenants attend personal inspections with no more than 3-4 persons in their group.
• Practice the distancing recommendations and avoid contact such as hand-shakes.
• Ask prospective buyers/tenants to keep touching of interior surfaces to a minimum or refrain. If they want to look in a cupboard, wardrobe or drawer, open it for them.

We are confident this event will pass sooner than later, and we remain confident the property market will return to ‘full speed ahead’ before you know it.

In the meantime, adhere to Government guidelines and practice patience, along with a good dose of common sense.

Please contact us if you have any questions. We are all in this together and look forward to this event passing so we can all get on with our lives.

Stay well and be well informed.

Team AIAB

 

One of the unavoidable tasks that go with selling your own home is engaging with buyers.

Once one of them cuts from the heard, and makes a B-line for your property, this is the person who is likely to write the cheque and take your property off your hands so you can move on with the next phase of your life.

Pretty much sums it up?

If this is the case, THEN DON’T MAKE IT HARD FOR THEM TO BUY YOUR PLACE!

Life, love, relationships, career, selling a lawnmower on gumtree- you name it – is, at times, all about kissing a few frogs to find the prince or princess.

You want to engage as many potential buyers as possible to work toward a scenario of buyers competing against each other, not competing with you, to buy your property.

Finding THAT buyer is no different.

But trying to weed them out, and avoid puckering up, before you’ve even laid eyes on them or had a cursory conversation, can quite easily leave you empty handed – where are the buyers?

Sadly, some sellers go to great lengths to avoid attracting and meeting buyers with repellents in their property descriptions such as:

INSPECTIONS BY APPOINTMENT ONLY

INSPECTIONS STRICTLY BY APPOINTMENT

BUYERS REQUIRED TO PROVIDE SUITABLE ID BEFORE ANY VIEWING

OPEN FOR INSPECTION BY APPOINTMENT (What does that mean?)

GENUINE BUYERS ONLY THAT HAVE THE FINANCE AND ABILITY TO BUY…

Sure, we want to avoid tyre-kickers and ugly frogs, but written ‘demands’ can put even the most qualified buyer off and stop them from picking up the phone or sending an email as an initial enquiry.

Imagine if Harvey Norman dropped a qualifying condition at the end of one of their TV ads, “And don’t come to our stores if your credit card is maxed out!” Revenue would plummet based on the attitude that message conveys.

When you act on the thought, “I’ll sell my own home” and embark on the process, think of it this way:

You want to engage as many potential buyers as possible to work toward a scenario of buyers competing against each other, not competing with you, to buy your property.

Talking to them, and having a brief conversation can tell you very quickly if they are fair dinkum or kicking tyres and licking ice cream.

Simply put, if you make it hard for people to buy, they won’t.

 

 

 

Before we put the property market under the microscope, it always pays to take a look at the wider news ‘cycle’; because, ultimately, it can have an effect on the sentiments of home sellers and buyers.

If you listen to BIG media, and their predominant ‘doom and gloom’ they will have you believe that, once again, the sky is about to fall.

Impending punch-ups in the Persian Gulf, US/China trade tiffs, looming recessions, sinking Pacific Islands, the dangers of farting cows and, of course, The Climate ‘Emergency’.

But it’s the underlying ‘good’ news that we don’t hear much about, that keeps things chugging along.

Cheap money (low interest rates), solid employment numbers (95% of those who want to work are!), massive infrastructure spending by Governments, and most importantly, we are only half way through the property ‘up cycle’ (understanding this cycle alone, is one of the most powerful tools a property owner or investor can possess).

Despite the media’s penchant for ‘eek, horror, scream shows’ on the hour, every hour, the property market, in general, is turning the corner from the mid-cycle dip that usually has everyone running for the exits.

If I had to describe what the property market is doing today, I would say, “It’s becoming a sellers’ market, where sellers are reluctant to play.”

In other words, buyers are massing at the border, with confidence and money to spend, and sellers are only allowing a few to cross as they are reluctant to offer their properties to the market.

The numbers and anecdotal evidence paint a very clear picture.

The Sydney and Melbourne markets are turning the corner with Auction Clearance Rates up toward 75% over the last 3-4 weeks.

As you will see in Michael Yardney’s State by State Update (mid August 2019) there are signs that the price slide has halted, and some small rises have been recorded.

However, with buyers keen to hop back it in, it is sellers who appear to be dragging the chain.  There are 10% less listings Australia wide as at this same time last year and one of the top Agents I talk to in Sydney’s south, reports listing numbers have almost halved from the corresponding period in 2018.

With less stock and more buyers, this is quickly moving toward a sellers’ market, most noticeably up and down the Eastern Seaboard.

What a time to save/make even more money and sell your own home!

Another indicator I have seen that shows things are improving is the higher enquiry levels for regional areas; they are generally dependent upon healthy capital markets as city dwellers look to retire or take on that sea/green change.

Yet, could it be the case that home-owners might not realise their advantage because the negative BIG news ‘cycle’ is influencing their decisions?

Or are potential sellers waiting on the sidelines hoping for bigger spikes in price growth? I believe that major price growth is unlikely in the short to mid-term. ‘Steady as she goes’ is more like it.

If you have any questions or comments about your take on the market, I would love to answer or hear them.

 

 

 

 

Seth Godin’s best seller, Purple Cow, would have to go on the ‘must read’ list for anyone setting out to build their own business, already have a business or work in the field of lead generation (marketing and sales).

It is a great book, indeed.

The title is almost self-explanatory as to what the book offers.

In a field of black and white milking cows, if a purple one stood amongst them, which one would you take the most notice of?

A recent ‘innovator’ in the real estate sales space took Seth on his word, almost literally, and called themselves Purplebricks.

Founded in the UK in 2012, Purplebricks hit the ground running and didn’t take long to get a market share based on their fixed fee model.

Then in 2017 it launched in Australia, then the USA in 2018.

Since then management re-shuffles, changes in service offering and agent resignations have made them industry headlines.

Recently, in early 2019, the Australian entity unleashed a massive advertising campaign, overhauling previous marketing iterations and point of difference by going in hard on traditional agents – whom they classed as ‘commission-collectors’.

This has raised a huge discussion around what is fair and what is not when it comes to commissions and fees payable on the sale of any property, what traditional agents are being paid, and are private house sales the way to go?

Purplebricks attempted to straddle both sides of the fence; one side being the use of a traditional agent and the other being the full-blown DIY, sell your own home option.

In effect they saw themselves as the ‘third alternative’. A fixed discounted fee with a ‘local agent’.

Not anymore.

Purple Bricks have just announced they are pulling out of the Australian market.

As I predicted around the time they kicked off in Australia, the model was not sustainable.  Why?

I’ll give you the bullet points, then I’ll discuss the two remaining viable options.

1. The PB ‘fee’ was $9,000: $4,500 upfront and the other $4,500 upon completion of a successful sale. The ‘agent’ would only be paid $2,000, a classic case of “you pay peanuts…” If $9,000 isn’t a commission, then I am a monkey’s uncle!
2. Their ‘agents’ were newbies or those who could not cut it in the traditional world. Generally, poorly skilled and trained, and mostly chosen by vendors based on the price point alone.
3. For them to make a decent ‘earn’ they would have to list and sell 4-5 properties a month (50 per year), which leads me to the next point…
4. The slowing market, especially in the two BIGGIES, Sydney and Melbourne, restricted the earning capacity of the PB agents, and their mother-ship, as less properties are coming to the market and selling.  Competition for listings is fierce. But this mid-cycle blip won’t last, however PB could wait no longer for the market to stabilise.
5. Population density and the tyranny of distance: In the UK, where PB was founded, there are 450 people per square kilometre; in Australia there are 3.1 people per square kilometre! PB agents had to, in essence, travel further in a bigger ‘trade area’ to get and maintain business. The time and running costs would have eaten into every dollar they earned via PB.
6. A similar concept, with some big money behind it, was launched in NZ in the early 2000’s, well before PB was thought of. It failed for much the same reasons as PB.

Hey, I am all for innovation and fair pricing for any service, but I feel for many of those involved in the PB undertaking. As myself, and many long-term professionals agreed – it could not be sustained.

So where does that leave you – the home or property seller who is looking to move on or cash in?

It actually leaves you with two clear alternatives.

Hire a full service, traditional agent, for a commission based on your sale price (plus, in some cases, up front marketing fees) or sell your own home via a reputable marketing and support agency like Agent in a Box for less than the price of a yearly gym membership.

What will you pay for the services of a full fee traditional agent? Well it can vary from State to State.  On average, across Australia, commissions have risen slightly and the average you will pay is around 2.35% of the sale price.  This recent article gives you a rundown, state by state.

Based on the average median price of a home in any of the eight State and Territory capitals, $545,000, the average commission would be around $12,800 + GST + Marketing.

You pay the agent to do it all – marketing, buyer qualification, inspections, negotiations, initial legal (contract) processes.

The alternative, ‘sell my own home’ via a reputable online portal, now represents somewhere between 5% – 7% of the total Australian property sales market.

When you consider NZ is around 10-12%, the UK 20%+, and the USA and Canada well North of 30%, Australian home owners/sellers are still weighing up the opportunity for control over the sale and massive savings that this option offers.

You, as the owner/seller, create your listing to be promoted on the major property sites, field enquiries from buyers as they come in, then engage the buyers, conduct inspections, negotiate a deal then have a lawyer/conveyancer look after the contract and legals.  All with support from property specialists with many years front -line experience.

It’s a little bit of work for massive savings.

Selling your own property is not for everyone, and traditional agents will always exist to run the whole process, but having a clear-cut choice of two options makes it much easier on home owners after Purplebricks made their announcement.

And in a sub-script to all this; the Melbourne Storm will be looking for a new major sponsor – shame.  #UpUp Cronulla!

Thanks for lessons Purplebricks, re-inventing the wheel is not as easy as you think, but I dip my hat to you for the red-hot go you had.

If you have any questions about how to best go about selling your home or property, don’t hesitate to drop me a line at info@agentinabox.com.au

Cheers,

Craig

 

 

 

“Its not all about you, Craig”

These were some of the last words I would hear from my dear old mum, Marg,  back in February 2016.

We loved to take little digs at each other, and she would relish saying to me, “Don’t be facetious darling.”

Back then she was doing it tough with Pulmonary lung disease (never smoked in her life) and I was by her side, taking shifts with my sisters.

One late afternoon I was sat at the foot of her bed in one the family recliners we had moved into her room to make her as comfortable as possible.

I must have passed out for a quick forty winks and awoke with that feeling of “where am I, what time is it?” I remember seeing mum sitting up in her bed with the oxygen into her nostrils, and as I stretched in the recliner I said, “I must be tired, I just passed out…”

To which the old girl wryly replied, “It’s not all about you, Craig.”

We both giggled. I made sure she was comfortable and, kissed her on the forehead as one of my sisters arrived to keep watch over her.

“I’ll see you tomorrow, sleep well Marg.”

At 9.20pm that night she took her last laboured breath and left us for the big sleep.

Her ‘facetious’, almost last comment to me – It’s not all about you – could be applied to the parts of the property market in Australia.

Particularly the big ‘drivers’ of Sydney and Melbourne.

Sure, when they cough, burp, trip or fart the media goes into meltdown. Is it ALL about them?

What about the other cities and major regional centres across and up and down this wide brown land?

Adelaide is on the up.

Brisbane is holding its own, as is the Gold Coast.

Hobart has been the poster child for the last three years, and, along with the rest of Tasmania, should chug along steadily in 2019.

Perth will have to bounce back shortly.

To get a brief, yet comprehensive, overview of the entire property market, Michael Yardney’s State by State report makes for some interesting reading.

Also, some reports I have seen coming from the two big brats, Sydney and Melbourne, are showing that one key indicator of the health of the market is showing some signs of improvement – Auction clearance rates.

Could the market cycle in the BIG TWO be reaching the bottom, and buyers, along with investors believe now is as good–a-time as any to pounce?

“I would not be sitting on the sidelines much longer.”

A great example of this is my nephew and his fiancé in Sydney’s south.

First home buyers, both in well-paying solid professions, saving like mad and two years ago thought they had been priced out of their desired postcodes.

Now, their properties and locations of choice are merely a case of diving in.

They asked me whether, or not, now is the time to pull the trigger.  Here is my exact response:

“I believe the cycle in Sydney may be nearing the bottom. Properties on your radar and in your budget just got a lot more affordable for people just like you.”

“The longer you wait in this part of the cycle increases your chances of starting to have to compete with other buyers, and investors, and in turn having to ante up more money for the property you really want.”

“I would not be sitting on the sidelines for too much longer.”

And I say this to everyone…

The more you listen to the mainstream media’s gloomy predictions, and continue to be distracted by the latest ‘play school’ antics in the halls of so-called power, the less likely you are of being able to make well-informed decisions when it comes time to sell your home or buy one.

But, could the ‘BIG TWO’ make it all about them, again, in 2019?

I’ll put it out there from the get-go; I never saw the movie because I knew how it ended.

“So, what has the grim end for the Titanic got to do with me wanting to sell my house?” I hear you ask.

Let’s head to the bridge of that ‘unsinkable’ vessel on that fateful night in April, 1912.

But before that, did you know…

One of the richest men in the world, JP Morgan, financed the building of this, at the time, incredible ship.

JP Morgan was one of the architects of the ‘Federal Reserve Act’ of 1913 (USA), which allowed for the formation of the Federal Reserve – the most powerful Central Bank in the world, and the model for every other central bank controlling the currency and economy of almost every western nation, including Australia.

Three (very rich) men who opposed the formation of the Federal Reserve; Benjamin Guggenheim, Isa Strauss and Jacob Astor where aboard the Titanic on its maiden voyage.  None of them survived.

JP Morgan and Milton Hersey (to become head of the massive Hersey Family conglomerate) were booked to sail on the Titanic, but both cancelled at the last minute.

Back to the bridge.

Captain Edward Smith, commanding officer, peering through his binoculars at the threats that were presenting to the vessel, “Mr Wilde (First Officer), I’m not liking what I am seeing, I think our best course of action is to re-arrange the deck chairs.”

“Ummm, Sir,” a bemused Wilde sputtered, “I’m not sure that is our best course of action during this critical time.”

“Wilde – do as I ask.  The decks will look very inviting for the passengers in the morning.”

“As you wish Sir.”

And, as we all know why I didn’t go see the movie, smack bang into an iceberg.

Did Mr Wilde re-arrange the deck chairs? I doubt it.  I might have made up that conversation, but the analogy, ‘It’s like re-arranging the deck chairs on the Titanic’ is applicable to the sometimes well meaning, sometimes futile efforts of property owners when selling.

In this changing market; where buyers are being driven by the pursuit of value, some sellers who are not attracting or generating genuine buyer interest are shifting the deckchairs rather than taking decisive, meaningful action.

ALL sellers have control over ONLY three facets of the sale process and can tweak them at any time to draw a response from the market (buyers) – the three P’s:

Present your property to IMPRESS buyers

Promote your property to REACH buyers

Price your home to ATTRACT buyers.

Concentrating your efforts in areas that don’t come under any of those three controllable facets generally helps maintain a course to, well, nothing – but nothing, no buyer action, in Real Estate is tantamount to sailing headlong into a massive chunk of ice.

Sometimes I like to term it ‘Sticking a band-aid on a decapitation’.

If you are not getting the response you had hoped for when it comes to private house sales – almost always it is one of the three ‘P’s (Presentation, Promotion or Price) out of whack and inhibiting your efforts.

And 99% of the time it is that one ‘P’ that is the culprit.

This article should give you some idea.

When you set sail on the good ship Sell My Own Home, there is no doubt you want only but smooth sailing, but when the seas become a little treacherous, you have the ability to take the wheel and steer into favourable waters anytime you choose.