A fundamental shift from the old industry way of thinking, is providing clients with a fresh approach to real estate.
Director Carl Slade, said their new locally developed real estate brand, ‘Restate’, has evolved from a vision for an industry that is better for consumers and agents.
Mr Slade is a third generation real estate agent with 24 years personal experience. He believes that the traditional industry has several major issues that need to be addressed. The first is Trust. “We are dealing with what is often our clients biggest asset. Yet research shows that close to 90% of consumers don’t trust real estate agents and question in who’s best interests they are really working.”
The real estate agents act, introduced in 2011 to raise the professionalism in the real estate industry, makes it clear that agents have a fiduciary duty to act in their clients best interests. “Just like other professions such as Solicitors, Doctors and Accountants, we must put our clients interests ahead of our own. However, the entire real estate industry has been based upon a 100 year old ‘Sales’ culture and business model. Which when you think about it, is in conflict with our duty to our client.”
The other major issue with the industry is traditional real estate fees, says mr Slade. “Consumers wonder why they are so high and struggle to see them as good value. It’s simply because of the way the commissions work. They are contingency based, which means you only pay a fee if you sell. However it also means that sellers are paying substantially more than the true cost involved in selling their own property. They are effectively subsidising the industry for the expense, time and effort spent working for other clients who then choose not to sell. Traditionally, if you present your property well, price it realistically and it sells in the first week, then you still had to pay the full commission – even though there was less work and expense involved for the agent. It is a very inefficient model, says Mr Slade.
“We think that in this day and age consumers want more efficient and transparent real estate services. They also want more professionalism and better value for money.”
“We asked ourselves how we can fix these issues. How can we raise professionalism, increase trust and at the same time add better value to our clients? The answer was actually very simple, but demanded a fundamental change in our business model and thinking.
“So we have totally redesigned our service on a more professional ‘Consultancy’ based model. This changes everything”, says Mr Slade. “Because it means we are not here to talk you into anything. We are here to use our knowledge and experience to your advantage. It makes us accountable to not only get you a good deal, but to advise you when to walk away from a bad one, too.”
“The essence of a consultative culture is giving clients professional unbiased advice and transparent choices. So we have developed a range of services and fee structures that can be tailored to best fit each individual clients needs, rather than the traditional industry one size fits all approach.
It also means we can now help clients in many more ways than a traditional real estate salesperson. For example, you may have been approached by a private buyer and just need some unbiased advice on value, or some help negotiating and drafting the contract. A traditional commission only agent will probably try and talk you into listing with them, because thats the only way they can get a fee. We on the other hand will get on with doing just the work you need from us, and charge a fair fee based on the actual work and expertise involved.
We also now offer buyer consulting services. If you are buying privately or from a different agent and want some independent advice, then we can help”
Restate offer the choice of three different fee structures depending on your situation. There is traditional commission only, pure consultancy based hourly rate plus outgoings, and a mixed structure which is part consulting fees with a lower success fee. Mr Slade said that so far 75% of their clients are choosing one of the new fee structures. “It’s encouraging that so many are seeing the real benefits of our new model and those who have sold under it have saved an average of $5,000 compared to what they would have paid us under the traditional model”.
“It’s a win/win” said Mr Slade, “our clients are ending up with substantially more in their pocket and we are still fairly paid for our services.”
Mr Slade said that it was a hard decision leaving the Professionals brand that they have traded under for close to 30 years. “However, we have developed a model that is fundamentally different to the rest of the industry. When you look at every other major real estate brand, they are basically all slight variants of the same underlying sales model. We are heading in a totally different direction and simply don’t fit within that traditional industry culture any more. So the only thing left to do was start our own brand right here in South Canterbury”.
The above article is being published in the South Canterbury Courier newspaper this week, giving you a brief idea of who we are and what we are about. We welcome your comments and feedback…
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