REINSW President John Cunningham has called on agents and businesses alike to recognise that they are part of a commercial ecosystem that has grown around the real estate industry. But instead of focusing on how real or perceived competitors are ‘encroaching’ on business, Mr Cunningham urges agents to look at ways to collaborate and leverage the power the industry has as a whole – warning that any agent who refuses to adapt, does so at their peril.
“We need progressive agents who are ready to innovate and look outside their own self-interest and see the bigger picture,” Mr Cunningham said. “We need a change of attitude in our industry, when it comes to agents and suppliers. It’s not ‘us’ and ‘them’. Suppliers are not the enemy; we are all in this together. They rely on us for their business to survive and we rely on them to provide services and products that enable us to do our jobs well.
“To ensure our survival as an industry, we need to refocus on consumer service and look at how we can deliver a great experience and results for our clients. We can’t simply keep doing what we have always done simply because we have always done it. Those who are not willing or able to adapt will not survive in this changing world.”
How the industry has changed
Like all industries, real estate has undergone significant changes over the past three decades with the growth of the industry, expansion of franchises and emergence of online technology. But in many ways, the real estate industry has been slow to embrace the changing environment.
“If you look back before the big push of franchises in the 80s and 90s, when growth was significant, we had a marketplace primarily built around real estate agents and newspapers. There were no data portals or other sources of information or marketing like we know them today,” Mr Cunningham explained.
“There was a huge shift in the 90s, with franchises starting to expand and independent agencies opening more offices. During this time there was also a shift in suppliers who were getting bigger in their own right. All of a sudden the sector was more than just agents and newspapers. We certainly noticed things were changing in our industry, but there was no coordinated approach.”
The 10 years to 2010 saw one of the most significant industry changes with online platforms realestate.com.au and domain.com.au solidifying their position in the market.
“At the same time, our industry was becoming fragmented. Previously, agents used to physically meet to get industry updates, and discuss challenges and innovation. But these meetings became less necessary with information being distributed online – which in some ways contributed to the disconnect between agents and the industry,” Mr Cunningham added.
Operating in a commercial ecosystem
Rather than looking at suppliers and new players in the industry as competitors or threats, Mr Cunningham believes it’s time to recognise the power of working collaboratively so everyone benefits – similar to the way in which a biological ecosystem works.
“These days you see commentary about the market from agents, but also from economists and key representatives from suppliers to the industry. There are a lot of voices. We are effectively already working in an ecosystem. And yes, that does mean survival of the fittest and a race to be the quickest to adapt. But there are competitive advantages to working with stakeholders and suppliers. We need to embrace a new perspective about how the real estate industry operates,” he said.
The key to adapting, according to Mr Cunningham, is to improve professional standards. This will lead to better communication and unity within the industry.
“A lot of things have to change, but starting with education leads to the industry building consistency and unity,” Mr Cunningham said. “Many agents don’t fully recognise the responsibility they take on when they get their licence or open an agency. There is a massive disconnect across the industry, which comes from a lack of foundation knowledge, including ethics and professional responsibilities.
“We need to be focusing on our strengths as an industry and essential to that is providing even better value for consumers – personalised service, and giving professional and expert advice and guidance. In order to ensure our survival as an industry, professional standards need to go up.
“Consumers look to us for expertise around a very complex transaction. If we can’t give that expert advice then we do not deserve their business. As an industry, we need to move past the sense of entitlement some agents seem to have developed.
“Once we have addressed this, then we can look at other aspects like strengthening our position as a service industry and building consumer awareness of our offering. Our industry needs a very clear voice; REINSW needs to be leading that charge for the sector with one, united voice.
“We can’t be complacent. The sector needs to communicate and work together to adapt to the changing environment. As an industry, we have to be influencing what is happening in our immediate environment. If we aren’t engaged and influencing the changes, they will happen without us.”