Over the next 5 to 10 years the real estate industry across the country is going to undergo massive changes as we shift from a collection of state based industry’s to a true national real estate industry. As we prepare to evolve into true national industry it makes sense that we ask ourselves just what role state based real estate institutes can play in that future.

So the million dollar question is how can the REIQ, REINSW, REIV, REISA, REIT, REINT, REIACT and REIWA survive with nationalisation of the property industry?

The first nationalisation initiative in place will be National Licensing for real estate agents and a little further down the track will be the much larger Real Property Law Reform.

National Licensing

The National Occupation Licensing Authority (NOLA) allows for the national licensing of real estate agents which is due to come into effect on 1 July 2012.

The stated aim of national licensing is to remove inconsistencies between the states and enhancing consumer protection. Under the new licensing regime, real estate agents will complete standardised training to achieve a national real estate license or registration certificate. This will allow far easier mobility in our industry with real estate agents more easily able to work in other states.

National licensing is going to arrive far quicker than most people in the industry realise but the change has been coming since 2009 when the Council of Australian Governments (COAG) signed an Intergovernmental Agreement to establish a national occupational licensing system for specified occupations which includes real estate agents.

Real Property Law Reform

Harminisation of various laws across the states has gained significant traction recently and a lot of attention from the Federal Government. One of the areas receiving significant attention is property laws.

National property laws are the goal of the Property Law Reform Alliance (PLRA). The PLRA is a coalition of legal and industry associations committed to bring about uniformity and the reform of property law and procedures in Australia.

The PLRA Alliance was formed in 2003 following discussions between the Property Council of Australia and the Australian Property Law Group of the Law Council of Australia about the need for uniform real property legislation.

The membership of the PLRA is quite large but includes the Law Society from each of the states and the Real Estate Institute of Australia.

The Alliance is working for the introduction of nationally consistent property law, practices, procedures and compliance requirements throughout Australia. In doing so, it is expected that cross-border property transactions will be simpler, more efficient, and more cost-effective.

As most land in Australia is now held under Torrens Title, it is a logical area to commence the harmonisation of property law as the application of Torrens Title varies so much from state to state. The PLRA has created a draft Uniform Torrens Title Act (UTTA) which they are seeking comments for until 28th of February 2012. Real Property Law Reform is going to be a slow process but the outcome seems inevitable. It is expected that the adoption of a UTTA would also provide a basis for further national reforms, in areas such as mortgage and lease legislation.

Property Law is highly complex and a national reform is not going to happen overnight but I think national property reform is a fait accompli and the only question will be the time it takes to get in place.

Do State REI’s have a place in a Nationalised Industry?

In line with the nationalisation of our industry it makes sense to consider combining all state based institutes into one national body under the REIA banner. Under this sort of merger the current state institutes would become the state operation centres for the REIA.

In my mind the one main primary aim of each state based real estate institute is political advocacy and over the years they ave worked with the state governments on the state based legislation that effects their membership.  The different state landscapes provided the justification for their existence. But as nationalisation increases and state based differentials disappear the viability of our state institutes seem to me to  disappear along with it.

I therefore believe that to remain relevant to our industry that the state institutes need to combine under the REIA banner to create one large institute. A single powerful industry body would bring with it a consistent and more powerful advocacy for the national laws.

It’s true that the REIA in its current form already provides advocacy on national stage but it does so with minimal funding from the state institutes and whilst property laws differ from state to state the role is very minor at the moment.  A shift to harmonisation of property laws across the country will dramatically increase the this role.

Other major roles conducted by our state institutes would all seem to benefit from a larger national body and the economies of scale it would bring such as property research, training, advice, member to member and consumer to member dispute resolution.

As an example each institute would run their own training departments and CPD programs. Combining them all under one banner would provide greater economies of scale. All the major cost centres that are currently duplicated in each institute around Australia would provide significant savings in such a merger allowing for a greater return back to members. But it’s more than just cost savings.

A powerful REIA would also be able to provide real direction for our industry that we desperatley need. In the past the fractured representation of members has allowed commercial entitites to have much more power in our industry than I believe they should.  I believe that the REIA should provide leadership and direction in a similar vein to what I see NAR does in the USA>

The National Association of Realtors (NAR) in the USA provides a great model of a powerful national trade association. They provide a real difference in member recognition with its Realtor program where it has trademarked the name “Realtor”. If you engage a realtor to sell your property you know they are member of NAR.

NAR conducts political advocacy on behalf of its members and is able to do so on a very massive scale as a national body. It is allegedly the third biggest contributor to political campaigns in the country. In addition to their normal membership the NAR also conducts a range of further accreditation for additional certifications after members conduct additional study.

NAR runs the Centre of Realtor Technology (CRT) which provides a range of member and industry services in the technology space that our state based real estate institutes could only dream of. Unlike our own state institutes it does not just write about technology in monthly journals but takes an active role in the technology space for its members.

The CRT creates a range of software for the exclusive use of members and maintains technology standards and protocols  for all industry participants. It plays a leadership role in Technology throughout the industry providing training, surveys and white papers for members on technology issues.

A more efficient REIA could use some of the savings generated to provide additional member services like those above that  NAR provides it’s members.

The Australian state institutes cop some flack from members and much of it centres around the online space. Claims vary but essentially they focus on the institutes failure to counter the dominance of large industry players like Realestate.com.au and Domain.com.au.   What they have done in the online space has been too little, too late and most importantly too fractured across the states which all results in a  dramatic waste of members funds.

It is interesting to note that despite many more commercial players in the space than here in Australia, NAR runs the most popular real estate website for consumers at realtor.com which is completley seperate to their website for members at realtor.org. This is a free to list website for members with a range of premium add ons but it has none of the ads tat we see fill to overflowing our subscription portals here in Australia.

What are the Obstacles?

Initially I thought the major obstacles will come from within the institutes themselves but now I am not so sure. It’s hard for people to agree to merge and essentially make their organisation and their own position redundant.  I posed this scenario to the head of one of the state institutes recently and was honestly shocked with the response which recognised the challenges involved but in essensce agreed pretty much with the concept.

I sincerely believe that the executive and board members from each of the institutes are genuine in their desire to advance the industry. Whilst they may differ in approach and they certainly cant satisfy every member’s expectations I think that they will probably be less of an obstacle that many will predict.

I think the biggest hurdle will be the mass of smaller issues that will need to be dealt with when you merge 9 separate organisations into one. That probably means the sooner the state institutes decide that this is their future and they create a working committee to identify the challenges and work through the solutions the better.

What Do You Think?

It’s time to tell us what you think in the comments section below…

Is a merger of the Real Estate State Institutes on the cards?

Will it be good for the industry as a whole?

What timeframe do you think it is going to be applicable?

Will losing the state identity of our institutes be a good or bad thing?

Originally posted at the : Business2 Blog. Please visit Business2 to read all comments to the original article.

When will it become morally wrong for an agent to promote print to a vendor?

A state manager for the REA Group recently posed this question to  all of his business contacts on Linkedin recently.

As real estate agents we are constantly called upon to recommend and then implement advertising on properties for sale (and rentals for that matter)  that we represent. In many cases  this is done with the owners funds with VPA (Vendor Paid Advertising).

Unless you have been operating in a bubble there has been a dramatic shift towards online advertising in recent years and now real estate portals like realestate.com.au and domain.com.au dominate the landscape for property enquiries for virtually all offices through the country.

But is print dead?  Hardly.  Certainly over the past 10 years the once dominant print media has lost its gloss as what was once a one horse race had another player enter the game. Print is probably not even a close second at the moment. Print  is obviously on the way out, but its still got a long way to go and for many agents as it still delivers enquiries whether it be from colour magazines, newspapers or printed flyers.

What may keep print alive longer is the increasing costs of the top two portals and especially realestate.com.au who now has a $2000+ per month product in their bag of tricks.  This price level is similar to print advertising costs. Go back 5 or 6 years in time and find me anybody who would have predicted that online advertising for a property could have cost that much. With realestate.com.au’s reputation for price gouging the industry every year with huge price rises what will they be asking for this this top shelf product in a few years.

So should agents be asking when is it time to stop using print for vpa?  Of course… we do that every time we propose marketing to an owner.   Industry detractors will always suggest that advertising is done to promote the business not the property but I have never met an agent who will throw away good money, whether it be their money or the owners, when they knew they would get no enquiry from it.  That is totally counter productive of what we do.

So should REA State Managers be questioning the morals of their customers?  The comments made by Tom Ainsworth, the Victoria and Tasmania State Manager for the REA Group to over 500 connections on linkedin are probably not an official company position. Despite this many would argue that his personal comments would align perfectly with that of his employer.

What puts an interesting spin on it though is that according to his Linkedin profile before he started at REA he came from the News Ltd stable of papers including the Geelong Advertiser Group and Leader Newspapers.

Just a guess but I reckon when he was the Group Real Estate Manager at Leader Newspapers his opinion on agents investing VPA in newspaper advertising was a little different at that time. No doubt Tom would argue that his opinion has matured over time and as has experiences have improved… but I would suggest his opinion in both cases is tainted by the corporation who pays his wage!

Whilst Tom’s employer would probably agree with him, I doubt realestate.com.au’s master,  News Ltd would find his comments on the money!

I personally think Tom has a huge conflict of interest in questioning the morals of real estate agents if they select something that he does not sell.  That does not mean he has no right to ask it as after all it is an interesting question that we ask ourselves all the time.  I just don’t think he will like the answer that comes back!

The value proposition of the subscription portals is falling, partially because the subscription costs are rising well beyond sane levels but also because they have seemed to hit critical mass.  For many years we were use to realestate.com.au growing massively month on month… but that growth has stopped dead in its tracks. Even realestate.com.au’s monthly reports have stopped adding zero’s on to all of the numbers like they use to.

A couple of years ago I thought the death of print advertising in the very near future was a fait accompli. Now I am not so sure.  No doubt it will happen one day, but that is more than likely because newspapers themselves will become a digital experience rather than agents stop advertising in their pages.  Agents will then probably still advertise in that digital newspaper version.

There is and and always will be exceptions to the rule as around Australia some agents are already forced into an online only strategy with either low levels of VPA or agent funded advertising. For most of the agents around Australia total print advertising expenditure has dropped but is still a viable option delivering value enquiries.

Print will continue to decline and online continue to improve and one day what Tom describes will come to pass…. I just dont think that day is coming for the industry at large in the next year few years.

Despite what Tom would have you believe, agents will advertise where ever they think will deliver them the most number of quality enquiries.  The biggest “bang” for the “buck”. It is just not good business to waste money on ads that dont produce a result.

So… What do you think?

Are Tom Ainsworth’s comments the arrogant ramblings of an REA employee trying to toe the company line or is he on the money?

Considering he is an industry  service provider with an obvious bias towards his employer  should he even be questionings agents, his clients  morality or not?

Should agents be spreading their advertising across all types of media, old and new… or should we be only investing in online?

And at the end of the day it boils down to one point.. Is print totally dead or is there still life in the old girl yet?

Agents… We would love you to comment on the print experience for you and your office, but please share the type of market you operate in to give it some persepctive…   suburban outer Melbourne, small town South East Queensland or Sydney CBD etc etc.

]]> http://glennbatten.com/is-it-immoral-for-real-estate-agents-to-suggest-print-vpa/feed/ 0 http://glennbatten.com/real-estate-group-blocks-syndication-to-national-property-portals/ http://glennbatten.com/real-estate-group-blocks-syndication-to-national-property-portals/#comments Mon, 30 Jan 2012 01:45:48 +0000 Glenn http://glennbatten.com/real-estate-group-blocks-syndication-to-national-property-portals/ Could you cancel your realestate.com.au and domain.com.au subscriptions in 2012?

You would be forgiven for thinking real estate is all online these days  it dominates the landscape that much and online the search engines are the first port of call for property related traffic.  Just after leaving Simon Baker confirmed that even realestate.com.au received massive traffic, somewhere over 30% from Google which is just one search engine.

Portals and particularly the top two paid portals absolutely saturate the search engine results by investing heavilly in SEO teams. They take the listings data of real estate agents and combine it with questionable tactics to create millions and millions of pages across multiple domains. This tactic effectively blocks real estate agent websites from search engine results thus starving us from direct enquiry.

These tactics by the portals is highly questionable and is evidence of the power they have developed in our industry. We are charged to display our listings on the portals and in return we are restricted to what we can display. We are not allowed to link back to our own website on each listing. We cant put contact details or phone numbers in the body text of the ad. Breach the rules and they will remove the property, do it too many times and they threaten to kick you off.  Any links they do give you and the portals insert ‘no-follow tags’ on the links back to the agent websites which tells the search engines to ignore our websites and that they have no value.

They justify that enquiry by charging higher and higher monthly fees but the problem in this relationships are more than the monthly subscription charges. also a death of thousand cuts it goes further than that with the portals undertaking lead generation schemes whereby they intercept sellers on the site and sell those leads back to agents at inflated rates. The traffic that agents have helped create is being used to promote private listings on Domain and now even realestate.com.au.

I believe that Realestate.com.au would generate more traffic than all the large national real estate groups combined. Agents have effectively given control of their listing enquiries to the portals and now seller leads to two large media companies who have taken every opportunity and they will not give up that control easily.

Real estate groups are also suffering as agents around the country have rather cut their ties with head office rather than their realestate.com.au and/or domain.com.au subscriptions. Joining a large real estate franchise or marketing group once respresented a great differentiator from other agencies in your area. If you listen to the portal sales team the only way to differentiate your agency now is to pay more and more for feature properties, feature all, brochure all and all the other add on products. Real Estate groups are seen to be providing an ever diminishing value to their franchisees and members.

As real estate agents we have given them our listing data and our money willingly for years but the level of antipathy from agents seems to rise year on year at pace equal to the price rise.

With the 2012 realestate.com.au price rise just about to be released rumours are rife that its going to be the biggest one yet. So more and more real estate agents are going to be asking themselves the magical question more than ever — Can I survive without a realestate.com.au subscription?

Cutting the umbilical cord to the subscription based portals is always going to be difficult especially since we have essentially been starved of enquiry on our own websites by the SEO teams at the portals. Cutting that link would be extremely difficult and disasterous without an extremely effective e-marketing strategy in place covering SEO, PPC, Social Media and Email Marketing.

Australian real estate agents are not alone in asking if they can survive without syndicating their content to a national portal. In the USA agents have been cutting that cord from syndicating to their national portals. Edina Realty and Shorewest Realty in Wisconsin were among the first but the one group that has recently got the USA market buzzing is ARG. Abbott Realty Group (ARG) recently announced that they will no longer syndicate listings to third-party aggregators like Trulia, Zillow and Realtor.com.

Watch this video from ARG as they justify their decision to cut the umbilical cord. I think they do a great job in explaining their decision.

]]> http://glennbatten.com/real-estate-group-blocks-syndication-to-national-property-portals/feed/ 0 http://glennbatten.com/rebarcamp-concept-takes-off-in-australia/ http://glennbatten.com/rebarcamp-concept-takes-off-in-australia/#comments Tue, 25 Oct 2011 16:35:54 +0000 Glenn http://glennbatten.com/rebarcamp-concept-takes-off-in-australia/ With a name like BarCamp it’s no wonder Aussie’s have taken strongly to the concept but an REBarCamp is not really about a bunch of real estate agents hanging out in the bar.

A BarCamp is a user-generated conferences that is full of open participatory workshop-events, the content of which is provided by participants.  A REBarCamp is a barcamp for real estate agents.

One of the most often words to describe a barcamp is an unconference.

A typical real estate conference has a lineup of paid speakers and a strict agenda to follow whereas with an unconference there are no scheduled presentations or paid speakers. The day’s agenda is actually decided during the morning registration period by attendees submitting possible sessions that they’d like to participate in or lead.

The sessions are divided up into different groups, and organized by skill level, relevance and potential popularity. Typical subjects for a REBarCamp might include Blogging, WordPress Plugins, Video Blogging, iPad Presentations, SEO, Cloud Computing, Social Media 101 for Agents and making the most of your Smartphone.

Organising the days agenda

Just as the “social” experience has taken over much of what we do on the internet an unconference is a conference with big injection of social into it.  The attendees not only create the conference and participate it.

I love a quote from Mike Meuller in the states on the REBarCamp concept when he said:-

“In purist terms, a REBarCamp experience should be the single biggest learning event you attend all year (assuming you attend only one).  Yes, there are exceptions to the rule and every REBC is different, but if you attend a REBC and think it wasn’t worth every minute of your time there’s only one person to blame.”

The first BarCamp was created and organized in one week in 2005 in the US and the first REBarCamp was held in San Fransisco just 3 years ago. Since then over 300 events have been held throughout the US and this year the concept moved to Australia. Sydney was the first Australian REBarCamp, followed recently by Perth and on November 30th  the first Queensland event at Brisbane will be held at the Pineapple Hotel.

REBarCamp Sydney held earlier this year

I am one of the organisers for REBarCamp Brisbane so if you are going to be in BrisVegas at the end of November we would love you to join in on the discussion but you better be quick and register.  You can read more information about the Brisbane event on its’s Facebook Page and Peter Brewer’s recent blog post.

Other REBarcamps are in the planning stages so if you did not make it to Sydney or Perth and cant get to Brisbane keep an eye out for the next event in your area at www.rebarcamp.com.au

Did you attend REBarCamp Sydney or REBarCamp Perth??  Let us know your experience!

Originally posted at the : Business2 Blog. Please visit Business2 to read all comments to the original article.

Masters Home Improvement is  operated by a joint venture between Australian Retailer Woolworths Limited and U.S. Based hardware chain, Lowe’s. The Nerang Masters store is located just a few hundred metres from it’s arch rival Bunnings which is owned by the Wesfarmers group.

Construction on the brand new 14,000 m2 Masters Nerang store has been completed and Masters local staff are preparing for the store opening in mid to late October 2011. The store features a Trade Area, Large Retail Area, Nursery Area, McDonalds and Administrative Offices on the second level.

As the Nerang Masters stores readies for its opening Australia’s first  Masters store in Braybrook, Victoria, opened just two weeks ago to the public.

The new Masters Nerang store differentiates itself from Bunnings in a few different ways:

• Staff will be trained for at least 100 hours
• Stores will offer over 35,000 products.
• Stores which are more brightly lit, more colourful with polished concrete, large colour signage and store displays
• Stores aim to place more emphases on attracting female shoppers
• Buzzers scattered around the store which when pressed, will send a nearby staff member to that location to help out a customer’
• Stores will sell more ‘non hardware’ lines such as whitegoods
• Stores will feature a McDonald’s restaurants.

Originally posted at the : Nerang First National Blog

Here  are some of the best ways to find the best real estate agent in your area to sell your property”

For Sale Signs

The amount of for sale signs in your immediate area that any particular agent is no guarantee of a successful agent at all.  In fact in the current market conditions there are plenty of agents not making any sales at all in any given month.  Consider that every property offered for sale with an agent that does not sell is actually a failed marketing campaign.  In short, you should not care at all if an agent has more “for sale” signs in your immediate area as there are better indicators of the best real estate agent.

Good Agents Educate You on the Market and Don’t Beg For Listings

Many agents will stuff your mailboxes with flyers, recipe cards, calendars or business cards all begging for your business.  The best real estate agent in your area will keep you up to date with real estate market including relevant news, property for sale and recent sales but they wont constantly beg for your  listing.  They get listings because of their success rather than dropping a flyer in your letterbox every week.

You Want an Agent that Sells Houses

You only need to be interested in what they sell so when you need to start paying particular attention to the sold signs. A sold sign is the best proof you need in a real estate agent and many successful sales over recent months and years is exactly what you are looking for .

Check Out Their Trophy Cabinet

Success leaves clues and often that translates into stocked trophy cabinet of awards.   When you are comparing two or more agents there are a few simple rules to remember

• Industry awards are across all real estate groups and franchises and are much more superior than an award from just one real estate group.
• Real Estate Awards for a real estate group are better from larger groups with hundreds of members than smaller groups.
• National Awards are better than state awards which are better than regional or city awards.
• Agency awards are better than awards for just one salesperson.
• An award that covers a whole year is better than one that covers a quarter which is again better than an award for a single month.
• Recent Awards are more relevent that old awards that may no longer be indicative.

Checkout their Website and Online Presence

A great agent will have a great website, one that provides more than just property for sale and property for rent. You could hardly expect an agent that has a stock standard template website provided by their franchise group to go that extra mile for you if they havent bothered to invest in their own website.

With online e-marketing playing an enormous role you can expect the  best real estate agent in your area to be maintaining a blog, an e-newsletter and to have a presence on Twitter and Facebook.

Quality Assurance

Many agents have documented policies and procedures but very few take it further and get those policies audited and approved to International ISO 9001 standards.

Visit Their Office

 To really get a feel for the office sometimes the only way is to visit the office. Interviewing agents in your home can only ever give you part of the picture.  An office visit can highlight vast differences in the location, size and professionalism of an office that is not so apparent in your lounge room.

]]> http://glennbatten.com/how-to-identify-the-best-real-estate-agent-in-your-area/feed/ 0 http://glennbatten.com/hootsuite-for-real-estate-agents/ http://glennbatten.com/hootsuite-for-real-estate-agents/#comments Sat, 27 Aug 2011 08:22:30 +0000 Glenn http://glennbatten.com/?p=563 Hootsuite is an excellent social media dashboard that allows you to manage social media accounts including multiple Twitter, Facebook, Facebook Pages, Linkedin, Foursquare accounts and much much more.

They have recently released a industry guide for real estate agents on how to make the most of using Hootsuite.

RPData have been working on a valuation system similar to US portal Zillow in the USA where they provide a valuation to consumers.  Naturally this has upset real estate agents and valuers alike around the country. There are a couple of differences though but the primary one is that Zillow clearly identifies that the prices they provide are just estimates by calling them “Zestimates”.  Statistical guesses if you will.

It seems that RPData has removed the references to the word valuation since their launch but they still imply it with the claim ”Want to know what a home is really worth?”

This AVM (Automated Valuation Model) application is a feature on the RPData facebook fan page and allows anybody to track 3 properties for 6 months.

Really Worth??  …are they sure??.. because they contradict themselves when you start  using it with this additional information later in the process.

 This estimate is computer generated and is not a professional appraisal. It uses complex modeling which includes property attributes, recent sales information and other data elements to reach an estimate of the property value and possible value range. The model also provides an estimate of how confident the value tracker is likely to be based on the availability of key data elements such as the attributes of the home and depth of recent sales data.

This estimate depends on information relating to the subject property and other properties which may be incomplete or wrong, negatively impacting the accuracy of this estimate. This estimate is based on one or more statistical models and assumptions, which may not capture all relevant factors or features of the subject property. This estimate also does not take into account the potential impact of external factors (such as a change in the economy, future planned infrastructure or environmental contamination on the subject property), which may affect the value of the subject property. Accordingly, this estimate should not be relied upon by you or any other person, including when making any decision in connection with this or any other property.

We at RP Data value your feedback and our Data Integrity Team are on hand to correct any property data. Please send us an email with the property address and its full attributes to Customercare@rpdata.com and we will assist you.

You just have to look at the recent Optus decision to see just how outrageous claims in marketing hype cannot be protected by the fine print. RPData’s competitors, Pricefinder and APM quickly distanced themselves from such tactics.

The AFR article also covers most of the old ground from the previous two articles for those that missed them plus raises a few issues that we have covered on Business2 already such as the success the ACCC has had with realestate.com.au after complaints by the  agent assisted websites.

More interesting though is the reference to the Redfin model that Ben raises in the article.

Just like I did in the last article on the ACCC investigation  Ben draws similarity with how realestate.com.au and Redfin (http://en.wikipedia.org/wiki/Redfin) both have contact with the seller to sell advertising on their portal.  But Ben takes it a little further and more in line with a persistent rumour doing the rounds though the industry at the moment that states that realestate.com.au is looking more directly at the Redfin model, specifically the whole idea of commission sharing. This is of course countered by the numerous statements by Greg Ellis recently that REA will never claim some of the sales commission, an obvious response to the rumours.

When I called Redfin a Portal in the ACCC article, ex REA CEO Simon Baker responded in te comments with :

Your comparison to Redfin is misleading. Redfin is a real estate brokerage (agency) that primarily uses the internet to source leads.

They are not a portal.

They have a discount model and are attempting to change how agents in the US approach selling and marketing real estate.

Redfin do not fit into any box easily in the USA let alone here in Australia.  Whilst I agree with Simon that Redfin technically are not a portal there is far more to it than that as they are a hybrid solution and their offerings differ on location.

They run a website featuring listings from other agents similar to a potal but they also show property and charge commission…  BUT only in just 16 metro areas only… Outside of those areas, and that does leave a lot of the US, they have partner agencies that they generate leads for on their website. The partner agent only pays 15% to Redfin for that lead if they make a sale.

In areas outside of those 16 metro areas I would argue that they are more like a portal than not.   See for yourself at http://www.redfin.com/neighborhood/10157/CA/San-Diego/Loma-Portal  (the word portal in the URL was not lost on me either!)

Personally I cant see how that could easily fit into the Australian market at all. I believe that the strategists at REA would have considered every possibility including this, because I know I would have if it was my company,  I don’t think it has any legs.

A typical real estate transaction in the USA has a sellers agent and a buyers agent for 3% each, totalling a commission of 6%.  Redfin represents the buyer who effectively gets some of the commission back in savings similar to how Refund Home Loans works here in Australia.

Let’s face it, I believe that the moment they took their first listing authority it would take only a few days for 10,000 agents to remove every listing on the portal.

The article also raises something that an anonymous poster, Deepthroat alluded to in previous articles and that was the meeting of Victorian agents at REIV headquarters about the revolt against REA…

REIV cheif Enzo seemed very quick to add that he has not been a part of the meetings and the REIV only provided the meeting rooms as they often do.  Why was he not involved…  because Enzo is the CEO of RealEstateView.com.au if he was involved in discussions you can bet that REA would be calling in the regulators.

As I have said many times in the past since I started to contribute here in 2007 , real estate agents need to control our data and not let companies like Realestate.com.au, RPData and Onthehouse use it from their own benefits as clearly their monetisation models are at our expense.

With the debates starting to focus on RPData I am more convinced than ever that an REI portal website is not THE solution.  I dont think it will do any harm, and I am sure that it can only place more and more pressure on the top two portals but the key to Project Rebellion is control of the data itself, not just sold data, but all data.   If Realestate.com.au, Domain and the data companies did not have unfettered access and the right to sell and trade it amongst themselves then these problems would simply not exist.

It seems that the campaign in Victoria to withhold sales data might have had an unintended victim as agents are not advising of Auction results according to an article in the Sunday Age.  This issue itself  is not new though as if you compare the various Auction Clearence rates quoted by some companies they never seem to agree. Until the regulators legislate that public auction results be made public this will be an ongoing issue.

We should start to get an indication of what the real estate groups and REI’s ase  planning as a response soon.

Originally posted at the : Business2 Blog. Please visit Business2 to read all comments to the original article.

Questions directed at some of Australia’s leading real estate groups have seemed to focus on excessive price rises (see 1,2, 3 and 4) of realestate.com.au and the effectiveness of competition in the real estate online classified space.

Simon Baker, the ex CEO and substantial shareholder in REA has made some interesting comments on this blog recently regarding realestate.com.au prices :

If the franchise groups were serious about competing with realestate.com.au or at least providing a competitive offering, wouldnt they first start internally and attempt to organise group buying of REA subscriptions for their franchisees?

Imagine if all Ray White or LJ Hooker offices got together and negotiated as one for their REA subscriptions (and additional products). I think they would get a better price.

and

the most likely innovation will be suburb based pricing where there is significant differentiation between suburbs in the price paid.

and the most suprising comment from Simon was his take on add on products

The more interesting question is why do people have to buy the premium products? Do they really add value?

Does anybody else find that a little strange?

With all state Real Estate Institutes and the REIA meeting in Perth during the week strategies were again discussed to create a national industry run portal.  David Airey commented on this blog prior to the meeting :

“Sadly the REIA ailed to gain national support from most state institutes to launch or run a national industry owned portal. That’s a sad indictment of the politics that used to exist and allowed the commercial sites to grow around our industry at our expense.”

and

“I’m on the record on many occasions criticising REI’s for this intransigence and for not listening to members.”

But the current momentum in the industry may have changed some minds as all indications are that this roadblock may finally be pulled down and our REI’s finally taking a role that many members thought they would never see and that is the operation of a national industry controlled portal.  But taking on the might of REA would not be easy and one of the strategies being discussed is using the REI’s to feed to the commercial portals with delay of say 3 or 7 days. This would allow REI portals at a state and national level to promote something like “Find it first on  xyz.com.au”.

As this plays out behind closed doors the campaign to withhold sold data from  realestate.com.au is gaining some serious momentum and reports from small and large national real estate groups and portal pushers continue to roll in.

One side effect of withholding sold data from the likes of REA is that data companies like RPData who has paid substantially for this information feed from REA. RPData and other similar companies provide essential data services back to agents but also provide market analysis and review consumed by the nations media. With a strong national portal in place it’s expected that RPData will move to establish arrangements direct with the institutes bypassing REA entirely.

Another thing Ben Hurley has reported on today is the presents and gifts that Realestate.com.au is showering on their biggest spending clients.  With the real estate market slowdown agents have looked to reduce discretionary spending. REA have used things like dinner at high end restaurants, State of Origin games, Business Class flights and even brand new iPads to secure the relationship.  I personally have heard of a sales team being flown interstate to watch the AFL when discussions of reducing their yearly spend was raised.

Realestate.com.au has over 10,000 real estate agents throughout Australia and whilst many agents  spend around $1,000 a month there are offices who spend 10, 20 and even 30  times that amount which is primarily funded by Vendor Paid Advertising (VPA).  Realestate.com.au’s campaign to increase the share of wallet has been right around the country but it has been particularly successful in Melbourne where they have less competition from Domain and high dollar auction campaigns are popular .  As an example the Premier Property option offered by realestate.com.au can cost an owner well over $2,000 per month.

Many in the industry showed increasing concern towards REA’s motives when a video surfaced showing their intention to market direct to buyers and sellers. Check out the video yourself, particularly from 9 min 30sec of this video.

In response Greg Ellis issued a written response which seemed  to contradict itself from paragraph to paragraph. Why his response was not circulated widely by email is unknown but it might have something to do with the fact its easier to watch the video by clicking on the link if it was sent by email. I doubt to many would have typed in that long url.

In the letter he claimed that it was incorrectly reported that he wanted to cut agents out of the loop but then went on to state:

The development of site functionality that allows prospective buyers and sellers to access or claim property information that can be accessed by agents so they can cost effectively identify a new pool of leads.

I am sure I am not the only one that reads this sans spin to be that they are going to escalate their use of agents sold data, listing data and valuer general data to provide additional products to buyers and sellers direct and then sell those leads to agents…. as “cost effectively ” as realestate.com.au can do of course!

In an interesting side note REA reps have now started to sit down with salespeople and sellers in their homes to pitch $2000 a month Premier Property and other options in the marketplace. This appears to be very similar to the Redfin Portal in the US who have a team of salespeople on the ground in capital cities. The primary difference is that Redfin salespeople also present property and take a cut in the commission, something REA have repeatedly claimed they will not do.

REA’s dealings with the ACCC lately has not been good and has seen the scrapping of the Private Listing Policy which finally allows private sellers easy access to list on realestate.com.au.

The drought of sold data would certainly have some sort of effect on future revenue streams and to a certain extent current products but a successful ACCC action and a industry controlled competitor together would provide bad news for Australia’s largest and most successful real estate portal.

It’s going to be a very interesting few months as this all plays out but if it was bad news for REA it’s terrible timing for newcomer Onthehouse. A strong industry portal is not going to be good news for them.  Their original investor document and  subsequent prospectus highlighted the monetisation of client agents data.

The underwriter (and partial owner) took it a step further in their report when they stated :

“Low integration risk, with ongoing data feeds. PortPlus and Console databases are ready to be “plugged in” into OTH’s database. In addition, both businesses do not sell their software – they license it to each customer on a rolling basis. As such, they retain ownership and control over the software and its intellectual property. With the appropriate terms and conditions in place with clients, each business is licensed to access and upload the content that is captured by the software”

Customers of Portplus and Console are already questioning when the terms and conditions are going to change and just where their data is going to end up. I expect their competition will start to raise the issue and use this against them when pitching for business.  Even though the float was over subscribed, in their first month of trading the shares dropped to as low as 60c which must be a huge concern for the original operators of Portplus and Console who are restricted in selling many of their shares for quite some time.

Certainly, the “Noise” is getting louder by the day!   Join in and tell us what you think about the latest developments.

Originally posted at the : Business2 Blog. Please visit Business2 to read all comments to the original article.

Today on the front page of the Australian Financial Review Ben’s article “Real Estate Agents Revolt” appears.

The article discusses hotly debated topics on this blog and its interesting seeing the discussion raised in more mainstream media.   The article covers some great ground and I expect there is more to this story up his sleeve for followup articles.

Some interesting quotes from the article are  :

The major agencies, such as LJ Hooker, Ray White, Raine & Horne and Century 21, are considering using their combined mightto setup rival information suppliers and advertising portals.

“It’s called Project Rebellion,” said David Airey, president of the Real Estate Institute of Australia

Real estate groups including RE/MAX, Professionals and First National are cutting back on the information they provide to REA.

and Ben was able to get some quotes from Greg Ellis, REA Group CEO

“REA will never take a dollar from the commission of selling and listing property, that is the exclusive domain of the real estate agents,”Mr Ellis said.

He said sold-price information was “absolutely a non critical part of the information we provide”.“People are significantly more interested in what their property is worth, which does not come from the sold information alone,” Mr Ellis said. He would not reveal the information used to calculate property values.

Grab a copy of today’s AFR or download the article by clicking here.

If you have anything to add to the story for further followup Ben can be contacted on bhurley@afr.com.au

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