If 2021 has taught us anything so far, it’s to expect the unexpected.
With parts of Sydney, Brisbane, Perth and most recently, Melbourne, experiencing some form of COVID-19 lockdowns over the past two months, the real estate industry has had to be ready to change course at a moment’s notice.
Domain’s Melbourne-based Chief Commercial Officer Tony Blamey told Elite Agent that last year’s lockdowns had prepared agents well when it came to reacting to sudden changes in the social landscape.
“Agents have been really quick to adapt to these situations and the changes in the market and they had a lot of practice last year,” Mr Blamey said.
“What they’ve done is embrace new technology, so they think of things like online auctions and virtual inspections to really help buyers and sellers to continue on the journey and not be disrupted.”
Although Melbourne’s final clearance rate was revised down to 70.6 per cent on final figures last week, there were still an impressive 635 auctions held across the city last weekend despite the snap five-day lockdown, which was announced last Friday, starting at 11.59pm the same night.
“What we saw last Friday with that five-day circuit breaker was that agents had to react really quickly, and I think they did that in a couple of ways,” Mr Blamey said.
“One was to bring some of the auctions forward to the Friday, which certainly happened, and then to move online for a whole lot of other auctions that remained on the weekend, and that was really effective.
“We saw volumes hold up and we saw clearance rates hold up well as a result of that, which is remarkable to be able to really turn that around in such a short period of time.
“And that’s because they’re prepared and they’ve been able to embrace those technologies, and now they can trigger them very quickly and that really puts them in a good position to deal with those unexpected snap lockdowns.
“We’ve seen [lockdowns] happen all around the country but particularly here in Melbourne, where there was a long period last year and where there’s such a strong, high-volume auction market, that ability to move those to an online environment was critical.”
Domain has also been in a position to capitalise on the larger migration to online transactions, after quickly moving to offer virtual inspections and having Real Time Agent – the product it obtained when it acquired Bidtracker in 2019 – at its fingertips.
“Bidtracker is a platform that agents could use to drive bidders to the online auction directly and capture bidding to get to an outcome.
“The other key offering from Real Time Agent was digitised sale authorities and digitised contracts, so we could facilitate the contract signing in a fully digital workflow, so there’s no paper contracts.”
Mr Blamey said the Homepass app, which is majority-owned by Domain, had also proved to be beneficial, with the electronic check-in tool allowing for contract tracing capabilities.
“If there’s an electronic check-in at an open-for-inspection, when using a tool like Homepass, then there’s a one square metre distancing role that applies in that situation, but if there’s a manual process, then it’s a four square metre social distancing rule. So there’s an advantage in agents picking up that more automated technology like Homepass.”
In addition to preparing real estate industry workers to be able to quickly pivot in the event of snap lockdowns, Mr Blamey said proptech applications would continue to create efficiencies that would allow agents to focus on their core work.
“I think there’s plenty of opportunity to keep improving processes for agents – and for buyers for that matter, as well,” he said.
“If we look at a service offering like Real Time Agent, that can save an agent four hours per transaction. That’s an efficiency saving for any business and many of these agencies are doing dozens of transactions a month.
“When I reflect back on the market a few years ago, it’s come a long way, and COVID really helps that to an extent because it does accelerate that adoption of – and usage of – technology.”
Meanwhile Domain posted their half-year results on Tuesday (February 16), with CEO Jason Pellegrino noting earnings before interest, taxes, depreciation, and amortization (EBITDA) totalled $54.5 million, up 3.6 per cent on the first half of 2020, while listings on the portal had enjoyed year on year growth.
Revenue was $137 million, down 5.5 per cent on 2020, but expenses were also reduced by 9.9 per cent to equal just $82.5 million.
Ultimately that saw Domain deliver a first half net profit of $19.4 million, but with continuing uncertainty around COVID-19 the board opted to defer any payment of a dividend.
“Today’s results demonstrate our ability to capitalise on the current opportunities, whilst purposefully investing for long term growth, squarely focused on the elements we can control. We are executing on the opportunity that lies in front of us,” Mr Pellegrino said.