Thursday, November 26, 2009

IS IT WAR???

A national showdown between the real estate industry and public portals such as realestate.com.au and Domain.com.au seems almost inevitable now as the race for on line dominance goes to a new level.


Actually outright war is possible.
Actually outright war is probably more likely as the greatest fear of an entire industry starts to become a reality. The power of public portals and their ability to capture data is on the cusp of changing all the rules and the age old promise that only real estate agents will have access to advertise on them has been circumnavigated, but who really is being fooled??



A company called “My Home is For Sale” now boasts “We are an online real estate agency that offers vendors 95% of typical selling costs if the owner is prepared to hold an open inspection.” Then it goes on to brag about advertising on “all the top industry sites” in an ad and names the two above.



So what is the inside story on this. Well my guess is that because the REI’s are all getting back on track and rebuilding their own web sites the gloves are off. In Adelaide we have seen REISA adopt www.realestateview.com.au as it’s preferred member web site and this is owned by agents and pretty much is imported from REIV (Victoria’s REI).



My assessment is that because realestate.com.au has put up it’s rates to such an extent, that decisions by agents and sellers have to be made about online verses paper advertising. It was never an issue because online was so cheap. As you can see with the weekend press, we still get amazing results from the press and we have found that it is becoming like TV and Radio, they both play a very important role at different times in the sale. We previously reported what was happening in the USA with online and explained that consumers are ultimately driving the agenda by wanting their marketing done cheaply.



So what are my thoughts? I think real estate agents are at cross roads. In the USA the winners are the heavily resources “FULL SERVICE” agents (franchise and Independent) on the one hand, and then the cheap virtually sell yourself partial service agents on the other. Fewer sit in the middle, and full service highly resourced independent agents are where Toop&Toop have focussed in our USA studies as they are flourishing (and commanding 5 to 6% fees!!!!!). Toop&Toop have used technology to keep client fees competitive even when comparing apples and oranges but what is clear, the discount based agencies are weak and disappearing. These “sell yourself” agencies are staring to take over that discount partial service part of the market.



No private seller can have the power and reach of what we do at Toop&Toop, and the laws are now so complex that private sellers will have to spend a fortune covering them against getting sued. Most normal mums and dads buyers do not like the negotiation process and really have no idea on such large transactions.



Personally bring it on, let the consumer pick what they are after. The only losers here are the agents that don’t really offer much. Sellers who want to save a few dollars are no different to the white collar person who thinks they are a carpenter or bricky and invariably end up realising that hopefully before it costs them tens of thousands of dollars.



With online, well as you know, we set our own agenda at Toop&Toop…be sure to see last Wednesday’s ToopTV available now on line and on pod cast. We had a sensational interview with Brenton Eden, the State co-ordinator for CFS about fire proofing your property. This coming Wednesday at 1 pm tune in live and interactive and hear how to chop off the back of your block, and how to deal with boundary disputes. Email us now with your questions on www.asktoopie.toop.com.au!



Remember all the reports available at www.insidestory.toop.com.au.



Anthony Toop, Managing Director.


www.toop.com.au


© Toop Real Estate Group

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