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New agents are in for a market shock

The throng of new real estate agents who joined the industry during the recent market boom could struggle during the current downturn, according to some of the nation’s top agents.

According to NSW Fair Trading there are almost 20,000 more current real estate licences in the state than in 2019, while the Office of Fair Trading recently noted Queensland saw an increase of almost 7500 agents in 2021 alone.

In South Australia, numbers have increased slightly, up from 3481 registered agents in 2019-2020 to 3586 in 2021-2022.

In Western Australia the number of active licences dropped 831 in 2021, but is so far up 106 this year.

Gavin Rubinstein, TRG (Sydney)

High-performing agent and Luxe Listings Sydney star, TRG Founder Gavin Rubinstein said the market was in for a mighty shakeup.

He said new agents, who were used to securing listings with ease, seeing groups of buyers and achieving high prices, would be in for a shock.

“Good luck,” Mr Rubinstein said.

“The market is in such a flipping state right now. It’s changing and some days it’s better than others so every new result is counting.”

Mr Rubinstein said now was the time for every agent, even those who have been in the industry 20 and 30 years, to check their ego at the door, increase their service levels and “show up every single day as a student”.

“I say it all the time – I’m a beginner,” he said.

“Today, I’m a beginner. Tomorrow, I’m a beginner. Have an open mindset and just overwork.

“This business has a way of exposing you when you don’t put in the work and don’t put in the effort.

“When the tide pulls out, you’ve got to be making sure you’re putting in the effort for the reward and, when you do that genuinely, over a period of time, that will compound and you’ll see a return on that.”

Mr Rubinstein said now was the time for newer agents to “over-service” clients and look to team up with the top agents in their office to maintain momentum and learn.

“You’ve got to over-service your vendor in every single way possible,” he advised.

“It’s not just about selling the home, it’s about anything they need, whenever they need it, however they need it.

“If you’ve come in during the past one or two years and you’re starting to struggle, I’d work with someone in your office who is on top of things and comfortable in this climate.

“Maybe even bring them in on your listings and leads to try and help you convert. 

“You’re still going to be involved and get the benefit of the positive energy that’s produced from running the campaign and the result.”

Mr Rubinstein said perseverance and persistence were critical in every market, but particularly a changing environment and it was important to advise vendors carefully.

He said there was still depth in the buyer pool, particularly in the high-end market.

“They’re not paying prices that we were seeing in 2021, but if you get the process right and price your property accordingly, you will create competitive tension and that’s got to be the objective of every single real estate agent,” he said. 

“It shocks me when guys who have been around for one or two years, or even a longer period of time, try to state that they know where it’s going to end or what a property is worth.

“No one at the moment – no one – knows true value.

“It’s almost like 20 or 30 years of experience means nothing right now, too. It’s who’s most active right now? Who’s feeling the market? Who’s at the coalface?

“Product knowledge is integral. You need to know what’s coming on, what it offers, how it compares and when it sells, what it sells for and why it sold for that.”

Mr Rubinstein said agents who could do all of that, and more, had a chance to build a solid reputation in the market downturn.

“You’ll start to see certain agents become outliers in this climate, and it’s really where some individuals can build a great reputation and make a name for themselves,” he said.

“I’m seeing the biggest opportunity I ever have in my 15-year career right now.”

Thomas McGlynn, BresicWhitney (Sydney)

BresicWhitney Chief Executive Officer Thomas McGlynn said every agent had to adjust to the market downturn.

“Anyone that has started in the industry from 2015 onwards, has probably had a little bit of a wake up call in the past six months,” he said.

“I would equally say that a lot of the agents that have been in the industry for a long time have probably forgotten some of the times that they’ve been through in the past that have been similar to what we’re going through right now. 

“They have also had to go through a period of adjustment to reposition themselves for this next period that we’re going to be in.”

Mr McGlynn said the advice he was giving to his team right now is to focus on their mindset.

“Shift your thinking of what success looks like, and you’ll actually end up shifting the results,” he said.

“For us, it’s been about, are we connecting with our community? 

“Our community might not be listing and selling right now, but they will when things stabilise, and we want to be at the forefront of the market when things are better.”

Mr McGlynn also advised agents to focus not just on time management, but energy management and the actions that they know lead to listings and sales even if volumes are lower right now.

“It’s really important to look at energy management, because you actually have a lot of energy zapped out of you when you feel like you’re constantly pushing against the tide to make things happen.

“That’s actually a lot more tiring than having 10 auctions on the go.”

BresicWhitney CEO Thomas McGlynn.

Tristan Tomasino, Buxton Inner West (Melbourne)

Buxton Inner West Managing Director Tristan Tomasino said as well as new agents finding the current market much more difficult, many experienced agents had decided to get out.

“In our core market we’ve had a mass exodus of older agents selling their businesses or getting out of the industry completely,” he said.

“A lot of those agents, who may have been through four or five cycles, just can’t be bothered going through another one.

“It is a lot harder. You’re probably working 30 per cent harder for 30 per cent less than what we’ve been making the last couple of years.”

Mr Tomasino said the market wasn’t “all doom and gloom” and properties were still selling, but it was definitely harder to get deals done and there had to be some tough conversations with vendors.

He said agents needed to ensure they were using the right dialogue with vendors as well as buyers.

“Every agent over the past couple of years could open up a property and in three or four weeks it would be sold for $100,000 above the vendor’s reserve and they looked like a superstar,” he said.

“You wouldn’t have to have any conversations other than who the interested buyers are and having a great result next Saturday.

“But that script is completely flipped on its head now. So we’re telling the younger guys in our office that you have to be prepared to have tough conversations with vendors very early on.”

Mr Tomasino said many agents would never have held a ‘set to sale’ meeting with vendors but these were now critical as they stepped out the selling process, market conditions and what to expect in terms of potential groups through open homes and the number of contract and second inspection requests.

“Before you go to market, sit down with the vendor and have a 20 minute meeting about, ‘what does a great campaign look like in the current market’,” he advised.

“If, after the first open, you haven’t hit the threshold of what a good first open would be you can say, ‘10 groups through the first open is really good, five is on par but we got zero to two through and we really need to have a discussion around potentially adjusting the price because we haven’t met the right buyers yet’.”

Mr Tomasino said while the current market was the toughest some agents had faced, he didn’t think it would drop too much further and there would be opportunities arising.

“If agents can make it through the next six to 12 months, I think next year the market will be okay,” he said.

Stuart Bourne, Raine & Horne Lower North Shore (Sydney)

Raine & Horne Lower North Shore Director Stuart Bourne said agents that could make it through the next couple of years would come out the other side with valuable experience and better skills.

He said the key was to “go back to basics” and to double down on communication with owners, many of who were currently feeling very underwhelmed with the market.

“Part of our job is to make it an easier transition for them,” Mr Bourne said.

“Communication has to be increased to daily, if not twice daily.

“The more contact, the more they feel in control. When I say they feel in control, agents are still controlling the process and giving their advice, but owners need to feel like they’re next to you on the journey.”

Mr Bourne agreed there might be the need to have some trickier discussions with vendors at the moment.

“You’re going to have to help an owner understand that the sooner they sell the better,” he advised.

“Even though today’s prices might be okay for them, in a month’s time that okay price looks like a phenomenal price. Only it’s unattainable in a few months.”

Raine & Horne Lower North Shore Director Stuart Bourne.

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Kylie Dulhunty

Kylie Dulhunty is the Deputy Editor at Elite Agent.

Cassandra Charlesworth

Cassandra Charlesworth is a features writer for Elite Agent Magazine with over 15 years’ journalism experience in metropolitan and regional newsrooms. She has a specialist interest in real estate, tech disruption and a good old-fashioned “yarn”.