As stock levels remain stubbornly low there is one clear problem starting to emerge…there are way too many agents. According to RateMyAgent there are 189 real estate agents in Mosman alone.
Despite what many people may think the majority of agents don’t make many sales. The market leaders write the lion’s share of the business and the rest tend to struggle. A major side effect of this incongruence is some of the behaviour on the field. As a confirmed veteran (thanks Domain) things have become more ‘western’ out there than I have ever seen. Seriously, in a desperate attempt to win listings some agents are doing appraisals promising outcomes to potential sellers that are as far-fetched as Trump’s sense of self-accomplishment.
In addition to these price promises we also hear on the daily other audacious claims about being street experts, price range specialists, social media gurus, mystery Chinese buyer wranglers, yawn…it just goes on and on, and on. And the worst part is some punters buy it.
This desperate attempt to differentiate in a highly competitive environment really sheds the spotlight on one cold hard truth, most agents just do the same thing – the pitch has become more about the story than the deliverable.
The market has started to respond to this and the result has been noticeable fee compression. If you are being told that no one gets out of bed for less than 2% that simply ain’t true. Many agents are now pitching closer to 1% than 2% (sorry agents but you know it’s true). On the home front one of my favourite claims about us is that we are too busy. I can confirm that yes we are busy, and we see that as a very good thing.
Here’s a thought, if you want to know what the market is really like perhaps you should talk to agents that are actually making sales. Why? Please don’t make me answer that.
Desperate times call for desperate measures, it’s a shame to admit that the industry is a bit of a mess and has a long way to go. A real-time example of this is a high profile agent this week has started his own agency. That was the story. Oddly what wasn’t covered is that he has been pummelled in the media for malpractice and also tanning to a crisp under the very warm spotlight of Fair Trading. What actually happened was that he was ‘whisper’ quietly dropped by the franchise, even they didn’t have the courage to call him out. The question is why?
Ok ok rant over, it’s possible I’m just feeling cranky due to sleep deprivation. Last night myself and many other middle-aged folks rocked out to Bloc Party at the Hordern…ok, by rocked out I mean constantly checked in with babysitters and avoided injury by limiting any sudden movements.
A wet weekend ahead, hopefully we will see some of you out on the circuit.
Until next week,
David Murphy