Agents at the centre

July/August 2016 edition

Agents are in a unique position to extend and deepen their involvement in all stages of the real estate transaction by building and nurturing relationships with clients that extend beyond the obvious moments of buying, selling and leasing.

By Tina Liptai

The agent of the future will be at the centre of every real estate transaction. That’s the firm belief of John Cunningham, Managing Director of Cunninghams and REINSW President. They will offer a wide range of services to their clients, be a complex problem-solver with creative solutions, and will provide sound information and advice about the property and the market. They will also have a reputation for behaving ethically and provide a high level of service.

“The value agents bring to the transaction lies in their specialised knowledge of people, property and the real estate market,” Mr Cunningham said. “Agents need to position themselves as experts. But more than that, they also need to continuously demonstrate their expertise to clients and broaden the scope of services they offer.

“From understanding client behaviour to technical knowledge of the relevant legislation, agents need to share their expertise at every opportunity and be ready to guide consumers at every touchpoint they have with the industry – regardless of whether it results in a direct financial benefit to the agent themselves.

“The days of simply showing up at a property and opening the door to show people around are long gone. Agents must be able to provide insights by drawing on their local knowledge and industry expertise, and in doing so position themselves as the trusted advisor who is integral at all stages of the transaction.”

REINSW CEO Tim McKibbin agrees and said agents, and the industry as a whole, need to look at improving the services they already offer and extend into other complementary functions.

“The more you can do for your client and the more you are involved in every part of the transaction, the more valuable you become.” – Tim McKibbin, REINSW CEO
“It’s about increasing the quality and quantity of service,” he explained. “Rather than attempting to resist the changing environment, we need to look at how we can adapt and evolve at all levels.

“The more you can do for your client and the more you are involved in every part of the transaction, the more valuable you become.

“Consider every problem, issue or potential problem a client has and look for ways you can be the solution. Every time you can do something additional, you are adding value and cementing yourself as central to the real estate transaction.”

Agents as educators
Consumers have access to more information than ever before. But rather than making agents obsolete, Mr Cunningham believes this has made the role of agents even more important; agents can use their knowledge and experience to help consumers by being the expert interpreter of the data.

“While having access to lots of information and data sounds great in theory, the reality is that it can be confusing and overwhelming for consumers if they don’t have the knowledge or expertise to interpret and apply it correctly to their own situation,” he said.

In real estate, as in other parts of life, you can’t believe everything you read – and there is a lot of conflicting, and even misleading, information out there according to Mr Cunningham.

“An important part of what an agent does is to educate consumers. By doing so, we’re positioning ourselves as the ones in the best position to interpret the data and share the correct insights to help them make informed decisions.

“These days consumers are sophisticated and we need to respond to this by demonstrating our expertise and sharing our specialised knowledge to help guide them at all stages of the transaction. Agents shouldn’t be acting as ‘gatekeepers’ of the data. We need to be educators and show consumers that we are here to help them understand and navigate the marketplace.”

“We need to be educators and show consumers that we are here to help them understand and navigate the marketplace.” – John Cunningham, REINSW President
Mr McKibbin believes one of the biggest challenges that agents face is educating consumers about the complexities of real estate.

“The problem is that experts tend to make what they do look easy,” he said. “After you’ve watched the Australian Open, you feel like you can pick up a racquet and play the perfect set of tennis because the professional players make it look so easy. It almost seems effortless.

It’s similar with real estate.

“For consumers to believe real estate is ‘easy’ is good in the sense that it shows agents are delivering outcomes professionally. But it’s important that agents continue to add value to their offering and educate consumers about the importance of having a professional to guide them through what is a serious financial decision and legally complex transaction.

“Of course, in truth, it’s not easy at all to do what agents do. It’s a complex process, and agents need to know what needs to be done and when it needs to be done in order to get the best outcome for their clients.

“As we continue to live in a more complex and regulated world, the days of the amateur are limited for most industries. We need to educate consumers that what they are paying for is the knowledge and experience that comes with engaging a professional – and while it may look to be easy on the surface, it’s not.”
Agents as disruptors
Though it’s easy to dismiss ‘disruption’ as a buzzword that’s thrown around all too frequently, the threat posed to the real estate industry by disruptors is real. It’s one that needs to be taken seriously and one that the industry needs to respond to in order to ensure that the essential role of agents is not undermined.

According to Mr Cunningham, one of the biggest disruptive influences the industry is facing at the moment is the proliferation of agent referral sites.

“Referral sites will certainly have an impact on our industry in the future and they will be used more by consumers unless agents lift their game,” Mr Cunningham said.

“These sites prey on consumers who are ‘scared’ of agents; those who have perhaps had a bad experience in the past or have heard about bad experiences. The fact that these sites even exist should show us that consumers want agents who are experts. They want to be guided through the transaction by an expert and that is an opportunity for the profession.”

Mr Cunningham said agents who sign up with these referral sites are trying to take the easy road. “They’re being lazy. It’s that simple,” he said. “We need to lift our value proposition, build trust with consumers and demonstrate our expertise. By doing this – by disrupting ourselves – we can beat disruptors like these referral sites.

“We need to position ourselves as a valued and important source of information, guidance and service, so when consumers come to make the decision about which agent to engage, there is no room for referral sites.” - John Cunningham, REINSW President
“We need to position ourselves as a valued and important source of information, guidance and service, so when consumers come to make the decision about which agent to engage, there is no room for referral sites.”

Mr McKibbin agrees and goes on to say that referral sites are not in the best interests of consumers. “In the main, by essentially having agents bid for work, they are offering a false and misleading service. They prey on consumers’ concerns and fears, and promise to find them the best agent,” Mr McKibbin said. “The best way for us as an industry to combat these referral sites is to ignore them. They add nothing to the transaction and without quality agents engaging in the service, they won’t be able to continue to operate.”

However he goes on to explain that it is certainly not in the best interests of the industry to ignore other disruptors, particularly in relation to the use of technology and other innovative opportunities.

“There’s a lot of money in real estate and people are designing electronic solutions to do all or part of the agent’s job. To combat this disruption, agents need to seek out ways to add value to their offering and make sure they remain integral to all parts of the real estate transaction.”

To meet the challenges posed by disruption, Mr McKibbin believes that agents need to be more involved and engaged in the inevitable evolution of the industry. “We need to disrupt ourselves,” he emphasised. “We need to offer additional services, and use new and emerging technologies for the benefit of clients and integrate it into how we operate each and every day.”

Mr McKibbin said the real estate industry can’t allow itself to be like the taxi industry, which did little to respond when Uber first entered the market.

“To sit still is dangerous. As an industry, we need to be mindful of the threats and evolve quickly. History shows us that those who don’t evolve don’t survive.”
Agents as facilitators
Acting as a facilitator is an excellent way for agents to position themselves as integral to every part of the real estate transaction.

Helping a vendor to source a solicitor to draw up a contract, assisting a purchaser to secure finance, explaining the importance of landlords’ insurance to a property investor, and helping a tenant organise the connection of essential services prior to moving into a property are just some of the ways an agent can offer a higher level of service.

Entanglement is the word Mr Cunningham likes to use when explaining how agents can become integral to the transaction. “Agents are an important part of the transaction, but we need to be more involved in every stage – we need to be more entangled – and there are lots of ways for agents to do that,” he said.

“The agent of the future will deliver a high level of value and service, and will always be looking for ways to increase their offering in order to embed themselves in the transaction from start to finish.”

Even before an agent visits the property, they have an opportunity to position themselves as not only an expert, but a very helpful facilitator.

“Smart agents understand this is a long-term game. The top agents do more in order to be there for their clients every step of the way.” – John Cunningham, REINSW President
“For example, when an agent first speaks with a potential seller they should ask questions about the property in order to gain a better understanding of the information the client might need,” Mr Cunningham explained. “So when they arrive at the first meeting, they are equipped with all the information the seller is looking for – and even information they didn’t realise they needed.

“If they have a pool, go along prepared with a list of certified pool inspectors. If their garden is in need of clean up before listing, give them the names of some your preferred gardeners. And if the interiors could do with a bit of a facelift, talk to them about the benefits of bringing in a property stylist for a make-over.

“The ways in which you can help your clients are really unlimited.”

By facilitating these services for clients, agents are laying the foundations for a strong service path and it demonstrates their ability to help the client make good decisions. “This is where the service journey starts and is how good agents can stand out from the pack,” Mr Cunningham stated.

“The difference between a good agent and a great agent is that they demonstrate their value by bringing their wealth of skills and knowledge to the transaction.”

Mr Cunningham said it is important for agents to understand that offering a high level of service should extend beyond the obvious avenues that generate direct revenue.

“Agents need to be offering advice in every way they can. Helping your client, even if you aren’t receiving a direct financial benefit, is going to pay off in other ways. They will remember your expertise and how helpful you were, and that could result in them recommending you to others.

“Smart agents understand this is a long-term game. The top agents do more in order to be there for their clients every step of the way.”
Agents as co-regulators
REINSW believes it can make a valuable contribution to the regulatory environment and professional conduct of agents though an industry-funded and shared regulatory function with NSW Fair Trading. 

According to Mr McKibbin, co-regulation is the best way forward for the industry, profession and consumers, and is also key to placing agents at the centre of all real estate transactions.

“One mechanism to improve the quality and quantity of service across the industry is better education. The more educated agents are, the more value they can bring to the transaction and in this way co-regulation will benefit the consumer and the profession,” he explained.

“No one understands real estate practice better than the practitioners, which is why co-regulation is so important. The regulator ensures compliance but that doesn’t guarantee great service from the agent for the consumer. With the profession and the regulator working closely together, we can ensure both compliance and a high level of service.”
“No one understands real estate practice better than the practitioners, which is why co-regulation is so important.” – Tim McKibbin, REINSW CEO
It’s Mr McKibbin’s strong view that doing so will also lift the perception and standing of agents in the public eye. “Better service will result in a better reputation for the industry and the more professional our conduct as an industry, the greater respect we will have in the community,” he explains.

“It’s going to take time and we will have to consistently be working to achieve increased professional conduct as an entire industry before consumers recognise the change – but it will happen.”

Mr Cunningham agreed that the proposed co-regulation model is going to be key in the evolution of the profession.

“Co-regulation will help by demonstrating that agents are capable of meeting professional standards – you can’t be an amateur and ‘just wing it’,” he said. “With agents adhering to higher standards of conduct, ethics and professional behaviour the industry will be seen as offering a vital service. Not merely putting a property on the market for sale or lease, we can demonstrate real estate agents are an integral part of a complex legal and emotional process.

“REINSW believes that we need co-regulation. We need to think and act professionally. Once consumers see agents acting professionally, perceptions will change. We believe we can change people’s perceptions and there will be less room for agents who don’t conduct their business professionally with a high level of service. There will be less room for people who don’t understand that what is right for the consumer is right for their business.”