A new frontier is fast approaching, and conquering its unique challenges is something to be done with a united, not a divided, approach.
That’s the message from REA Group Executive General Manager of Residential Andrew Rechtman following the Industry Leadership Forum in New Zealand in April.
With realestate.com.au hosting the forum, it was the ideal opportunity for the group to hear from 30 real estate leaders about the big-picture issues impacting the industry and the property market.
Think topics such as real estate disruptors, advocating for the industry, changing the way auction results are recorded, the impact of Gen Z, and more support in the property management sector.
Time to listen
“The purpose of forums like Queenstown is for us to listen, not to tell,” Andrew makes clear.
“We want to share as much as we can about our future plans but, quite genuinely, we value enormously the opportunity to have three days away with 30 or so of the leading industry figures to better understand the challenges and opportunities for the industry, and for those insights to shape our products and services.
“We want to be in partnership with the industry, and that requires a lot more listening than it does us talking.”
Andrew says that heading into the forum, he was acutely aware the real estate climate was unlike any seen before.
Prices have come off significantly in many markets over the past year, listings are down in most areas, the fallout from the Royal Commission continues, there was uncertainty over the federal election and a bunch of holidays were held in April.
“Coming into New Zealand, the thing we heard from customers was that this is a pivotal moment for the industry,” Andrew says.
“There’s a uniquely challenging environment for agents and agencies to operate in today that we probably haven’t seen for half a generation.
“It’s forcing people to think differently about the way they operate their office. It’s forcing people to think differently about how they market properties and market themselves.
“So that was a very difficult time, in some ways, to get together because the market is so tight.”
We want to be in partnership with the industry, and that requires a lot more
listening than it does us talking.
A new normal
The upside was the chance to examine what the future could and will look like, along with how the business will approach what might well be the “new normal” for our industry.
For REA Group specifically, there were several “game changers” to take home and strengthen, including advocating for the industry and assisting in preparing agents and agencies for a future operating model that will need to evolve.
Real estate disruptors are already here, and while Purplebricks is now out, Andrew says other disruptors will continue to come into the industry, in a bid to take market share away from the traditional real estate agency model.
But Andrew says REA is strongly committed to working with the current industry ecosystem to make it the best it can be.
High quality of service and exceptional levels of customer support are the best defence against disruption.
“This is so that we are robustly prepared to defend against those disruptors,” he says.
Supporting the industry and growing and changing with it is important to REA Group.
“One (game changer) would be our role in advocating for the industry, particularly in reinforcing the need for property owners to use a quality agent to represent the sale or lease of their property,” Andrew says.
“Our business is built on the collaboration we have with high-quality agents, and we take very seriously the responsibility and opportunity we have to communicate the value of agents.”
Another opportunity is to communicate the value of participation in the property market more broadly to consumers and to push the site’s more than six million users every month, as well as through REA’s close partnership with News Corp.
“I think we walked away thinking that’s a real responsibility we have to take on,” Andrew says.
In terms of tactical changes, Andrew says one main message was that the traditional way of reporting auction results didn’t accurately reflect that some properties sell before the auction and some sell soon after.
This potentially minimises the value of an auction campaign in the eyes of the public.
“A lot of what I came away with was how we could do things differently to better represent, better support and better influence the future of the industry given that we’re going through this pivotal changing time,” he says.
Social researcher Claire Madden also got attendees talking and thinking with her presentation on Generation Z and the consumer of the future.
In real estate, buyers, sellers and renters of the future will be Gen Z, as will the agents, property managers and their teams.
Andrew says that while current generations are traditionally motivated by money or status, Gen Z is increasingly driven by purpose and a reason for being.
This likely means success will look less and less like the hero agent writing $1 million, in favour of the team that supports and works with them.
“In the future, the way we communicate with our customers and with our teams is going to be very different,” Andrew says.
“We talked a lot in Queenstown about Gen Z’s challenge in face-to-face communication, but our challenge is being able to talk to them through the technology tools that matter.
“How many of us are familiar with Snapchat and our ability to communicate via that medium?”
The changing nature of how we communicate with our teams, with our customers and what those teams and customers’ expectations are, is going to shape the future of the industry.
Tools of the trade
Andrew tips that tools such as WhatsApp are soon going to be equally as important as text, and that messaging overall may be preferred to voice communication, or even talking in person, for many types of interactions.
“The changing nature of how we communicate with our teams, with our customers and what those teams and customers’ expectations are, is going to shape the future of the industry,” he says.
This is likely to dramatically change the way we work and raises questions about whether the traditional office setup will survive.
Andrew says the forum drove home that the products REA Group had already released, including Agent Elevate, Agent Match and the soon-to-be-launched Agent Reach, were on the right track.
“We still feel like those, in the future world where consumers are going to be looking to digital tools for finding the right provider of services, those products will be relevant, and that reinforces the importance of them in our portfolio,” he says.
Better supporting property management
Another area of opportunity to come from the forum included REA Group better-supporting property management.
With about 30 per cent of investment properties in Australia still self-managed, there are plenty of opportunities for property managers to meet that market.
“We talked at length about how we can do a better job of advertising the capability of a real estate agency to manage properties,” Andrew says.
“And we’re about to launch a new agency profile in the next couple of months that should highlight that.
“In addition to that there’s a lot more we can do to improve the application and approval process as a tenant goes through that first step in engaging with a property.
“We want to make continued improvements to 1Form, and we’ve recently added a tenant verification tool which takes work away from the property manager and is a great experience.
“There’s still more to do to make 1Form cutting edge technology, something that helps with the application process. Not just the tenant side, but something that makes it easier for property managers to go through the selection and approval process.”
More than one voice
While the forum tapped into the minds of a broad cross-section of industry leaders, Andrew appreciates there may be other ideas out there that should be brought to light.
So, if you’re sitting here reading this article and have an idea that you’d like to discuss, then the door is open to constructive conversation.
“We are here to listen every day,” he says.
“There’s a whole team of account managers that are ready to support our customers.”