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REAL ESTATE INSTITUTE OF NEW SOUTH WALES | JUL/AUG 2017 VOL 68/04

JOURNAL

PINK UP YOUR TOWNSupporting the McGrath Foundation

PROFESSIONALISMProven experience is the basis of trust

CO-WORKING SPACESThe rise of the new corporate cool

Know what

youstand

forBernadette Hayes shares how she’s remained true to

her core values

CONTENTSREAL ESTATE JOURNALThe Real Estate Journal is the official magazine of the Real Estate Institute of New South Wales.

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The Real Estate Journal is provided for general purposes only. REINSW gives no warranty and makes no representation with respect to the accuracy, applicability, legal correctness or completeness of any of the contents of the Journal. To the extent permitted by law, REINSW excludes responsibility and liability in respect of any loss arising in any way (including by way of negligence) from reliance on the information contained in the Journal. The opinions expressed in the Journal are those of the respective authors and do not necessarily reflect those of REINSW.

Major Partners Partners

UPFRONT5 A word from the President

6 In brief

8 Building your teamA panel of industry experts came together to talk about recruitment and retention of staff at the inaugural Agency Services Chapter forum.

PERSPECTIVES10 Know what you stand for

Bernadette Hayes, from Harbourline Real Estate, reveals how life experience and previous career challenges have allowed her to build a successful agency.

16 Passion and gratitudeBresicWhitney’s Suzie Hamilton-Flanagan talks about her stellar career and shares some of the lessons she’s learned along the way.

18 Pink Up Your TownREINSW is urging members to support the McGrath Foundation’s Pink Up Your Town initiative.

FOCUS21 Lobbying for equitable

outcomesCEO Tim McKibbin explains how REINSW has been working closely with the NSW Government on the review of the Residential Tenancies Act 2010.

22 Experience takes more than just timeEducation and experience must come together if agents are to be recognised as professionals.

26 Double down on documentationIf you show a property without the right documentation in place, you could find yourself on the wrong side of the law.

28 Brick by brick: Tackling the housing affordability crisisIt’s time to end the politics and take the steps that are needed to secure the housing market and address the ever-worsening housing affordability crisis.

32 Agent extinction: Hype versus realityWith the number of self-selling websites steadily on the rise, the question must be asked: are real estate agents on the verge of becoming obsolete?

34 Co-working spaces: The new ‘corporate cool’What’s driving the popularity of co-working and how are these shared, collaborative workspaces impacting the office market?

37 Tracking your tradiesA recent claim highlights how important it is to have the right checks and balances in place when paying tradies.

TRAINING AND EVENTS38 The power of online

learning

39 Calendar

LAST WORD41 New members

42 In the media

REAL ESTATE JOURNAL / Jul–Aug 2017 / 3

INSIDE

It’s a trust thingWhen it comes to professionalism, trust is the most critical element – and to build trust, as an industry we need to collectively embrace a mindset of continuous learning. Here’s why.

As we continue along the pathway toward professionalism, we need to bolster the trust consumers have in our industry. And to do this, we need to keep learning.

I’ve been in this business for 40 years and, while a lot has changed over that time, one thing has remained the same – the need to always keep learning.

I can vividly remember the day a lecturer said to our valuation class “the more you learn, the more you earn”. His words still ring in my ears to this day. Those eight small words made so much sense to me and it marked the beginning of my learning journey – a journey that continues to this day.

I strongly believe that every agent needs to keep learning throughout every stage of their career. It’s the only way to truly succeed and stay ahead. Be a sponge. Absorb as much knowledge as you can and work out how you can apply that knowledge to challenge the status quo.

Building your knowledge is the key to building your skills. Building your skills allows you to build your confidence. And by building your confidence you’re in a better position to build trust with your clients. Learning has a knock-on effect.

Building trustIn just the last handful of weeks I’ve attended both the Australian Real Estate Conference (AREC) and the Real Estate Results Network Principals’ Advance Conference. Leadership and trust were hot topics at both events. Both are learned and then earned, and underpin our role and responsibilities as agents. Without both leadership and trust, we simply can’t advise, guide and influence good decisions for our clients.

At AREC, Chris Voss, a former FBI hostage negotiator, spoke strongly about these two

themes and emphasised the fact that agents are in a position of trust. We are in a high stakes business. We’re working with sellers and buyers who are placing an enormous amount of trust in us. They trust that we have the knowledge and skills to deliver the outcomes they want in a situation that, in many cases, is highly stressful and very emotional for them. They trust us to make their lives easier and provide a positive experience.

My question to every agent in the industry is: how can we possibly deliver this if we stop learning because we think we know everything? The answer is simple. We can’t.

In the main, consumers don’t trust real estate agents and survey after survey shows this. As we continue along the pathway toward professionalism, we need to bolster the trust consumers have in our industry. And to do this, we need to keep learning.

So never stop learning. Grab every opportunity with both hands to build your knowledge and you’ll reap the benefits.

John Cunningham REINSW PRESIDENT


A WORD FROM THE PRESIDENT / UPFRONT

$$Wellness in the spotlightLong hours and high stress levels may be adversely impacting the wellness of agents, according to Jet Xavier, one of Australia’s leading mindset coaches. That’s why he’s launched a project to put wellness on the industry’s agenda.

“Most agents are time poor and not managing their health correctly,” Jet said. “They have no balance, happiness levels are low and they don’t have the success or freedom they desire or want.”

Jet has conducted a national survey to gauge the wellness of the industry. This was followed by an industry roundtable, where leaders discussed the survey results and recommended ways to address the issues identified. The project culminates in a wellness summit – Revive 2017 – to be held on 30-31 July 2017 on the Gold Coast.

“Revive 2017 will bring together some of the best agents, as well as experts in positive psychology and performance management, Jet said. “They will teach you how to create more balance in your life, so you become a master of your time and not a slave to it. You’ll also learn how to manage your energy and happiness levels, and be more successful in your life and business.”

Find out more about Revive at revive2017.com.au

Most agents are time poor and not managing their health correctly.

Building defect bond scheme delayedHome owners who have ended up buying into shoddily built apartment blocks will suffer the most from the NSW Government’s decision to further delay the introduction of the Building Defect Bond Scheme.

The scheme, whereby developers would put aside 2 per cent of the cost of a new building to be used to rectify any faults for owners, was meant to come into effect on 1 July 2017. It has now been postponed to 1 January 2018.

The delay has been blasted by strata lawyer David Bannerman, who said it will now miss the biggest part of the apartments’ construction cycle that has been continuing in recent years.

“There have been no legislative reforms to address quality in strata schemes since the last construction cycle more than 10 years ago,” he said.

A spokesperson for NSW Fair Trading said the delay had come about as the work to develop a new national standard for building inspections was not yet finished, nor were the processes, systems and qualified staff required to support the scheme in place.

Fire and Emergency Services levy delayedThe NSW Government has delayed introducing the Fire and Emergency Services Levy (FESL) indefinitely after concerns that small and medium businesses might face an “unreasonable burden”.

The government had planned to abolish the current FESL (added to home building, contents and some motor vehicle insurance premiums) on 1 July 2017. Under the new FESL, the state’s firefighters and the State Emergency Service was to be funded through a property-based levy.

REINSW President John Cunningham said the new levy would have been bad for the NSW economy.

“The new FESL was to be based on the unimproved value of property, which has nothing to do with the cost of running our emergency services, as opposed to the current levy being based on the replacement value of the structure,” he said.

“The levy would have left a large number of households worse off, as well as commercial and industrial businesses.

“We lobbied hard on this issue and it’s great to see the government has listened to us.”

There have been no legislative reforms to address quality in strata schemes since the last construction cycle more than 10 years ago.

DAVID BANNERMAN Bannermans Lawyers

6 / REAL ESTATE JOURNAL / Jul–Aug 2017

UPFRONT / IN BRIEF

Housing Affordability Report

Australia wide

ACT

Median weekly family incomeProportion of family income required to pay loan

$1,987

$2,086

$1,545 $1,688

$1,644

$1,639

$2,619

$1,688

23.4%

21.1%

26.2% 36.1%

26.7%

32.5%

20.1%

30.4%

23.6%$1,389

Repayments based on data for new borrowers

March quarter 2017

HousingAffordability Report

State of the nationThe March quarter 2017 showed an improvement in housing affordability nationally with the proportion of income required to meet loan repayments decreasing to 30.4%, a decrease of 1.3 percentage points over the quarter and a decrease of 1.3 percentage points compared to the corresponding quarter of 2016.

Over the quarter, housing affordability improved in all states and territories.

Compared to the March quarter 2016, housing affordability also improved in all states and territories.

Cash rateDuring the March quarter, the Reserve Bank of Australia (RBA) maintained the official cash rate at 1.5%. The quarterly average variable standard interest rate remained at 5.3%. The quarterly average three-year fixed rate increased to 4.3%, an increase of 0.2 percentage points.

First home buyersThe number of first home buyers decreased to 20,677, a decrease of 11.2% during the quarter but an increase of 1.4% compared to the March quarter 2016.

First home buyers make up 13.4% of the owner-occupier market and, if refinancing is excluded, the figure currently sits at 20.0%. The number of first home buyers decreased in all states and territories over the March quarter 2017.

Compared to the corresponding quarter 2016, the number of first home buyers went up in Victoria, Queensland, South Australia and Northern Territory with the largest increase of 11.3% in the Northern Territory and the largest drop of 11.1% in Tasmania.

The average loan size to first home buyers decreased by 3.2% over the March quarter and decreased by 0.4% over the past twelve months, to $313,433. Over the quarter, the average loan size to first home buyers increased in South Australia and Tasmania.

Compared to twelve months ago, the average loan size to first home buyers increased in New South Wales, Victoria and South Australia.

Lending trendsThe total number of loans (excluding refinancing) decreased to 103,193, a decrease of 8.2% over the March quarter but a 5.3% increase compared to the same quarter of the previous year.

Over the quarter, all states and territories recorded decreases in the total number of loans (excluding refinancing). Compared to the corresponding quarter 2016, except for Western Australia and the Northern Territory, all states and territories recorded increases in the number of loans.

Over the March quarter, the average loan size in Australia was $372,620, a decrease of 4.3% over the quarter but an increase of 2.3% compared to a year ago. During the quarter, the average loan size decreased in all states and territories.

Compared to the March quarter 2016, the average loan size increased in all states and territories except Western Australia and the Northern Territory.

Proportion of family income required to meet loan repayments & median weekly family income

Housing affordability improved in all states and territories over the March quarter with rental affordability generally declining across the country

New report shows value of foreign investmentA new report highlights the strong and substantive benefits to the economy of foreign investment in commercial and residential real estate. The ACIL Allen Consulting report, commissioned by the Property Council of Australia, is in response to ongoing criticism of foreign investment.

“We cannot let the myths about foreign investment continue to go unanswered,” Ken Morrison, Chief Executive of the Property Council, said.

“Foreign investment in commercial and residential real estate is a vital part of the Australian economy. Too many political leaders are now too frightened to defend what is an essential part of the economic DNA and this is dangerous.

“Foreign investment in real estate gets new projects off the ground, increases housing and office stock, boosts our national capacity and increases tax collections to all levels of government.”

Foreign investors currently directly fund $20 billion in commercial real estate and, in 2015-16, approved foreign purchasers funded up to $7 billion in residential development.

“We are not arguing for a less stringent system, but we are warning of the dangers of a political and media culture that seeks to decry foreign investment,” Mr Morrison said. “Australia is currently completing an unprecedented 26 years of economic growth. Foreign investment in real estate has been an integral part of this success. Taxing and discouraging new foreign investment will result in a loss of jobs and national economic income during a time when it is vitally needed.”

HOUSING AFFORDABILITY REPORT RELEASEDThe latest Adelaide Bank/REIA Housing Affordability Report has been released and shows that the proportion of income required to meet both home loan repayments and rental payments has improved slightly across the nation over the 12 months to the end of the March 2017 quarter.

Proportion of family income needed to meet

1. HOME LOAN REPAYMENTS

March quarter 2017

March quarter 2016

New South Wales 36.1% 37.4%

Victoria 32.5% 34.6%

Queensland 26.7% 27.7%

South Australia 26.2% 27.4%

Western Australia 23.4% 24.5%

Tasmania 23.6% 24.3%

Northern Territory 21.1% 23.2%

ACT 20.1% 20.5%

National 30.4% 31.7%

2. RENT PAYMENTS

New South Wales 28.4% 29.0%

Victoria 23.8% 23.9%

Queensland 23.7% 23.9%

South Australia 22.0% 22.9%

Western Australia 18.6% 20.2%

Tasmania 26.6% 25.9%

Northern Territory 23.7% 26.2%

ACT 17.9% 17.4%

National 24.6% 25.1%

DOWNLOAD the report at reinsw.com.au/reiareports

DOWNLOAD the report at propertycouncil.com.au


PERSPECTIVES / COVER PROFILEUPFRONT / AGENCY OPERATIONS

Building your teamA panel of industry experts came together to talk about recruitment and retention of staff on Thursday, 8 June 2017. Hosted by the REINSW Agency Services Chapter Committee, the panel shared their words of wisdom …

… ON RECRUITMENTGone are the days when we can afford to adopt a reactive mindset to bringing new team members onboard. Building your team should never be a case of “I have a position, so now I’ll start looking”.

Hiring is about fulfilling an immediate need in your business for a person with particular skills. But to secure top talent, you need to always be keeping an eye out for people who fit your business. You need to always be recruiting.

Here’s some key advice from the panel about recruitment.

1Use recruiters“More and more, candidates are using recruiters these days and recruitment can be a cut-throat industry. That’s why it’s important to

build a strong relationship with your recruiter of choice. Build an affiliation and use them for every position. They’ll grow to understand what you’re looking for. And always be sure to give them a good briefing document – leave no room for error.” – Caroline Glover

2Know what you want“Shape your goals, know what you want to achieve and build a team around you that will contribute to your agency. At our agency, we want

to have fun – but we also want people who will work hard and meet the expectations that we set for them.” – Carlos Gonzales

3Get to know the candidate“Drill down into the attributes of each employee and understand what they bring to your business. Far too many employers spend

the interview talking about themselves. Don’t fall into this trap. Spend the time finding out about the person that’s in front of you. And don’t forget to reference check. Never take a candidate’s CV at face value. All too often, there is false information – so it’s worth doing some work to understand the background of the person you’re employing.” – Bryan Wilcox

4Take your time“Never rush the recruitment process. Carefully consider what a candidate is going to bring to your business and understand how they

are going to help you achieve your business goals. You need to understand their DNA – what are the non-negotiable attributes they need to have? Don’t settle and stay true to your business goals.” – Kylie Walsh

CARLOS GONZALES Office Manager at LJ Hooker Willoughby

CAROLINE GLOVER Director at Elders Toongabbie

BRYAN WILCOX CEO at the Real Estate Employers’ Federation

KYLIE WALSH General Manager at Di Jones Real Estate

THE PANEL

Shape your goals, know what you want to achieve and build a team around you that will contribute to your agency.

CARLOS GONZALES Office Manager at LJ Hooker Willoughby


… ON RETENTIONRecruitment isn’t a one-time thing. It doesn’t stop when someone joins your team. Retention is a key aspect of recruitment.

Caroline Glover has a stellar track record for staff retention, with four of her team clocking up more than 10 years with the agency. Here are her tips about how to retain high-performing team members.

1Always recognise performance Whether it’s a lunch, an outing, a bonus, an increase in salary, or just a simple thank you, always recognise the efforts of your team. Remind

them that each and every one of them are important and play an integral part in the success of the business.

2Encourage flexibility We all have families and we all have different things that come up that require us to leave early or be away from the office. Make sure your

team know you are approachable and they can ask for flexibility without feeling uncomfortable about it.

3Put procedures and checklists in place Life is a lot easier when you know what to do every step of the way, so make sure you have robust procedures and checklists. Your team

will know what’s expected of them and feel more confident in their role.

4Stay on top of technology Having the right software and technology in place makes it easier and more efficient for your team to effectively do their job. It means

your team can focus on being at the top of their game.

5Build a strong team We all spend a lot of time at work, so it’s important to enjoy being with the people you work with. Providing support at all levels is a must,

as is ensuring everyone feels appreciated.

Agency Services ChapterThe term “in-house service provider” is not unknown in our industry and we know that these providers play an essential role in driving outcomes for all agencies. Whether it’s promptly answering incoming calls at reception or putting together a targeted marketing campaign. Whether it’s determining business strategy as a general manager or balancing the trust account. These practitioners support the business at every level – and they now have a home in the REINSW Agency Services Chapter.

JOIN THE AGENCY SERVICES [email protected]

We all spend a lot of time at work, so it’s important to enjoy being with the people you work with.

CAROLINE GLOVER Director at Elders Toongabbie


A career in real estate was never part of Bernadette Hayes’ plans. If you had told her 10 years ago she would one day be

leading a team of seven as Principal of her own independent real estate agency, she would have thought you were confusing her with someone else.

“If someone had told me this is what I’d be doing, I would have laughed at them,” she explained. “I never considered real estate as the career for me.”

Bernadette’s career had largely been in the hospitality industry, with a management role at the Opera House and later launching her own catering business in the 90s. Looking at getting back into the workforce after being very involved with school and community activities while raising her four children, Bernadette was considering new opportunities. Real estate was not what she saw in her future, but a brush with underwhelming customer service with two real estate agencies set the wheels in motion.

“I had a property manager looking after my investment property, but felt I could do

a better job – so I started managing it myself,” she explained.

Not long after, one of her friends found herself in a similar position and handed the management of her property over to Bernadette.

“My accountant noticed the extra income from managing the two properties and suggested I get a real estate licence. At the time I was considering retraining for a career change, but real estate hadn’t occurred to me,” she said.

After discussing it with her husband, who had worked in senior property roles with corporate and government organisations, she decided to take the plunge.

And so began what Bernadette cheerfully refers to as her “third career”. Not only did she get her real estate licence but, with the support of her husband, Bernadette opened her own independent agency – Harbourline Real Estate.

Sink or swimJoining the real estate industry with years of life and work experience behind her, Bernadette had

Bernadette Hayes cheerfully refers to real estate as her “third career”. Here she shares how life experience and previous career challenges have allowed her to build a successful agency that remains true to her core values.

Know what

By TINA LIPTAI

You have to make excellence a priority and do things professionally from day one.

you stand for

PERSPECTIVES / COVER PROFILE



I believe it’s important to create a workplace that supports women with families who are returning to work and want to continue to have a challenging and rewarding career.

very clear ideas about how she wanted the next phase of her career to unfold.

“Before I even started the course to get my licence, I knew I didn’t want to work for someone else,” she said. “I’ve always been fiercely independent and I have strong ideas about the way things should be done. So I knew from the start that I was going to work for myself and a big agency wasn’t going to suit me.

“I also had the very strong perception that ‘everyone hates real estate agents’, and I knew in my gut that if I was going to work in the industry then I’d need to approach it in my own way from day one.

“As daunting as it was in the beginning, I felt that starting my own agency gave me a fresh approach and I could do things how I believed they should be done. I wanted to be proud of my business and about what I was doing for a living, so I felt I needed to get away from the perceived real estate stereotype.”

While by her own admission she had “no real estate experience” and did not take a “traditional route” into the industry, what Bernadette did have was sound local knowledge from 30 years of living in the area, strong ties to the community and a commitment to providing excellent service.

“I was probably quite naive when I started the business, but with the support and encouragement of my husband I created a two-year plan with a budget and started small just to see how it went,” she said. “Most people probably thought I was a bit mad, but eight years later I’m still here.”

And she has even managed to lure her husband, Ian, away from his government job and recruit him as Director and Head of Property at the agency.

Away from stereotypesBernadette knows firsthand the valuable contribution agents with a diverse range of skills from previous careers outside real estate can bring to a business.

“I use all my skills from my other careers and it constantly surprises me,” Bernadette said.

Most of her team have held senior positions in professional backgrounds other than real estate, including the banking, finance and marketing sectors.

“What they all have in common is a passion for delivering excellent service,” she explained. “They also all had a strong interest in real estate before they joined the business and they bring very different, but important, transferable skills to their roles which benefits the whole business.”

Bernadette also values the contribution women can make to the workplace. More than half of her team are women with families. “I believe it’s important to create a workplace that supports women with families who are returning to work and want to continue to have a challenging and rewarding career,” she said. “We’re accommodating when it comes to school and sporting commitments. Women have a valuable contribution to make and bring diverse skills, experience and energy to the business.”

Personal serviceFrom the moment she opened the doors of Harbourline Real Estate, Bernadette has been passionate about delivering excellent customer service tailored to every client’s needs.

“When I take on a client, my phone is on 24/7. We don’t have an answering machine, someone always picks up the call to help our clients,” Bernadette explains. “I work mainly in sales, but I still have a strong interest in property management and I meet all the new landlords and tenants. I also have good relationships with all the tradespeople we work with.

“It’s important for me to still be very hands on. In the recent storms where the SES had a 12 hour delay, we received a phone call at 2am from one of our tenants. My husband and our handyman ended up on the roof themselves to stop a major leak after a tree had fallen onto the house. Our landlord was living overseas and our tenants were paying a lot of money, so it’s important to us to have that level of service for all of our clients.”

That personal touch also extends to each of her staff. “It’s a small office, so it’s important to have good lines of communication,” Bernadette said. “Everyone is across all new clients, whether




BERNADETTE’S TOP TIPS FOR REAL ESTATE SUCCESS

1 Always have excellence in mindFrom day one, do things professionally. Seek advice from people who know

what they’re doing, like REINSW.

2 Live your brandTake your time creating your business name and branding. Have a clear

direction, know what your brand stands for and live that in everything you do from day one. Invest the time to build your profile, be professional and work smart.

3 Build long-lasting relationshipsWord of mouth is vital. Building and maintaining strong relationships is

essential to business success.

4 See the big pictureIf you want to be successful, in the long run you need to see the big

picture and build your success organically. There will be ups and downs – nothing worthwhile comes easily, so you need to be very motivated and be prepared to work hard.

5 TeamworkHave a great team of people around you. Find people with talents and gifts

that you don’t have. And once you find good people, you must look after them.

6 Get a mentorFind a great mentor and be prepared to work really hard. Be realistic about

what you want to achieve and be 100 per cent committed.

7 Introduce the best systemsBe efficient and profitable by introducing the best systems for

your CRM, property management and of course your website which showcases your business.

sales or property management, and we can all help out if needed. Open communication across the business creates great morale because everyone is involved. Everyone is invested in the business – we work through challenges together and celebrate successes together.”

Remember why you startedLike most real estate businesses, one of the biggest challenges Bernadette and her team face is keeping up to date with the fast pace of the industry.

“Real estate is fast moving and you can never be complacent,” she said. “You must be across all legislation changes, software innovations and be focused on what’s happening in all areas of the industry.”

Despite the pace, Bernadette says it’s important not to compromise on the values and standards that are important to you and your business.

“Don’t cut corners with things like technology. Do the research and invest in quality systems that will help you to run your business better,” she said. “Make sure you have the best systems for servicing your customers and supporting your staff. It’s also really important your staff are fully trained and given opportunities to keep learning, because it builds confidence which is vital for a thriving workplace.

“One of the biggest things I’d say to anyone running a business is never compromise. Never be tempted to turn your business and how you operate into a production line and expand for the sake of it. Stay true to your values and why you started. Get comfortable with doing less, but doing it better than anyone else.

“We have politely declined to work with landlords when we realise our business values aren’t aligned. It can be hard to walk away, but this business is about quality property and quality tenants and you have to hold the line.”

Plans for the futureLike most business owners, Bernadette has lots of plans for the future – none of which involve slowing down. “I love what I do right now and want to see it grow each year as we continue to offer standout service to our clients.

“My husband might want to retire eventually,” she joked. “But I don’t want to retire. I’d like to keep training and mentoring. That’s something I’m really passionate about.”


PERSPECTIVES / COVER PROFILEPERSPECTIVES / COVER PROFILE

BUILDING A COMMUNITY FOCUSED BRANDFor Bernadette, creating a reputable brand and strong business began on day one.

“You have to make excellence a priority and do things professionally from day one. I had lived in the community for 30 years, so I was aware of community expectations and what I needed to do to create a strong local brand,” she explained. “I worked hard to build trust and a good reputation by dealing directly with the client base and securing those all-important word- of-mouth referrals.”

Giving backLike most agencies, Bernadette was keen to use her business to support the local community. But she stresses that it should come from a genuine desire to be part of the community, not as a way to publicise your business.

“I was raised in a family where being of service to the community was important,” she said. “So when I started the business, it was just second nature to me that we would support the community – and not just with money. Making time to give back is important – everyone benefits.

“Early on, I spoke with the Greenwich Sports Club about sponsorship. I didn’t have much money to offer initially, but it was important to me for my business to be seen to support the local community in any way we could. They were wary at first, because they thought I just wanted sales. But they soon realised that wasn’t my intention. I started out by helping with the club’s barbecue fundraiser and each year we’ve increased our support. This year, we purchased 750 jackets for the winter season as a major sponsor.”

Harbourline Real Estate is one of the key sponsors and organisers of the annual Greenwich Carols by Candlelight, with the funds raised going to Father Chris Riley’s Youth Off The Streets. Further local support goes to the Isabelle Heim Fund and Performing Arts at Greenwich Public School. They also support breast cancer fundraising, a cause particularly close to Bernadette’s heart as she is a breast cancer survivor.

High exposureAnother way Bernadette has been successful in building her brand was an appearance on the television show Selling Houses Australia. Though it was a positive experience for Bernadette and her business, she said it’s an opportunity that should be carefully considered by any agent.

“It was a great experience and it worked out really well, but it was a big risk in the sense that a successful sale may not eventuate,” Bernadette said. “The owner had previously spoken with me about selling the house. I am a little bit ‘out of the box’, so I told her she should be looking to target the local market for the sale and not developers. I got her over $4 million from a local buyer, which is what she wanted and it still holds the record for the top selling house on that show. It was a great experience for me and has helped build the profile of the business.”

The show aired in 2015 and Bernadette is still contacted by people who have seen re-runs of the show, so it has definitely had ongoing benefits.

Open communication across the business creates great morale because everyone is involved. Everyone is invested in the business – we work through challenges together and celebrate successes together.

Why I love real estate“I get a great amount of satisfaction delivering amazing results for clients. Buying, selling, or leasing property is a very emotional time and clients put a lot of trust in you. It’s truly a service industry and it’s very rewarding to help them through the process.

“I’m very pleased that I’ve built a strong business. I love that my team enjoy coming to work and I can help them further their careers. I value having people’s trust and always endeavour to do the very best I can for them for their valuable asset. You’re dealing with people’s hopes and dreams, and if you can help them achieve them it’s very satisfying.

“It’s a tough business – one minute you can be very successful and the next minute you’re not – but I wouldn’t change anything. My husband and children are very supportive and encouraging, which really makes a huge difference. They are so proud of what I’ve built.”


Passion and gratitudeWhen it comes to property management, BresicWhitney’s Head of Property Management Suzie Hamilton-Flanagan knows what works. Building a successful career in Adelaide over the course of 20 years before making the move to Sydney almost two years ago, here she shares some of the lessons she’s learnt along the way.

Did you always want to work in the real estate industry?I’ve always had a love for real estate, so I think it was inevitable that I’d end up working in the industry. Growing up, my mother had a passion for property investment and she passed that passion on to me. I spent a lot of time helping her to research properties and going along to inspections. I found it fascinating.

But I started my career heading in a completely different direction. My husband was working as a Creative Director for Young & Rubicam (an international ad agency) and introduced me to the advertising business. It wasn’t until after we had children and I was returning to work that I made the move to real estate. It was a real crossroads moment. I didn’t feel that advertising was in my future and a dear friend offered me the opportunity to run his agency’s property management portfolio. It was perfect timing and I decided to follow my passion.

From the beginning, I loved everything about this industry – and now, more than 20 years later, I still do.

Why did you choose to specialise in property management?I started my real estate career in property management and it was the area I saw myself specialising in, but I also knew that if I wanted to be successful then I needed to understand the whole industry. So about five or six years into my real estate career, I completed my Real Estate Licence and then worked as a sales agent for a number of years. It gave me a real understanding of the life-cycle of a client – buyer, seller and investor.

When I moved back into property management, I funnelled my sales skills into new business development. While it’s common now for property management teams to have a business development manager, 10 years ago it was almost unheard of to apply a sales mindset to property management. At the time I was working at Toop & Toop in Adelaide, which is widely acknowledged as one of the most innovative agencies in the country. From there I moved to Harris Real Estate, where I

was the General Manager of Property Management. Phil Harris asked me to join the agency to set up and build his property management business. We aggressively acquisitioned two rent rolls in three years, plus organically grew the business by recruiting the best BDMs in Adelaide.

What do you enjoy most about your job?We left Adelaide almost two years ago. My husband is originally from Sydney and wanted to come back, so here we are. My position at BresicWhitney affords me the opportunity to explore a lot of areas of the business of real estate that I’m really interested in.

I love people management and development. I’m very much a people person and believe that one of my key strengths is my ability to take people on a journey. I like nothing more than bringing someone into the business and creating opportunities for them to grow in the business. I get a real kick out of building a high performing team, setting them goals and seeing them meet their KPIs.

I also enjoy playing a part in developing and implementing business strategy. We’re currently mapping out a new strategy for our property management business. The world of property management is always changing and there are lots of new business models coming into the market. How does this impact our business? How does it impact our team and their careers? How can we bring everyone on the journey? I love having these discussions and seeing our team engaging in the process. We’re doing it as a team, so we have commitment, alignment and direction through strategy.

What are your goals for the next 12 months?We’ll be focusing on our team. We want to develop our people and provide them with pathways so they can grow their careers. We’ll also be working on our IT platforms, so they best support our service offerings. And we’ll continue to work on our operational systems and procedures to ensure the business is as efficient as possible and duplication of tasks is minimised.

I’m very much a people person and believe that one of my key strengths is my ability to take people on a journey.


PERSPECTIVES / Q&A

When you’re not at work, how do you like to spend your time?I like to get back to nature. I love to walk and, since moving to Sydney, we spend a lot of time on our weekends enjoying the walks around the harbour and through the national parks. For me, it’s about switching off. Real estate can be an all-consuming business, so it’s important for me to take time to be in the moment, be present and be grateful.

I have a grateful mindset about life. I’m grateful for my parents and upbringing. I’m grateful for my family and friends. I’m grateful for the career I’ve built, the job I have and the team I work with. Having this mindset allows me to focus on what’s important in life.

Is there a phrase you live by?Work hard, play hard. When you’re in work mode, you work hard. But in your down time, turn off from work and live your life to the full. It’s a philosophy I encourage my team to adopt as well.

What’s the best advice you would give to your younger self?I’d pass on a couple of important lessons I’ve learnt over the years.

The first is to always do what you love. Do what you’re passionate about. You spend more time at work and with your colleagues than you do with your family, so pursue a career you love. My son is currently over in the US on a college basketball scholarship. He’s six foot 10, so basketball is a natural fit for him! He’s passionate about the sport and wants to play at a professional level, and my husband and I are encouraging him to do what he can to make it a reality. Whatever your passion is, follow it. It’s something I truly believe.

Which leads to my second piece of advice – life is too short to have regrets. You’re setting yourself up to fail. You can’t afford to have that mindset. There are very few decisions in life that you can’t change your mind about. So make the best decision you can at the time and don’t regret it. Just take a chance and go for it. Don’t spend your time wishing you’d done things differently.

Work hard, play hard. When you’re in work mode, you work hard. But in your down time, turn off from work and live your life to the full.

PERSPECTIVES / COVER PROFILEPERSPECTIVES / LOCAL HEROES

Pink Up Your TownREINSW is urging members to support the McGrath Foundation’s Pink Up Your Town initiative to help raise money to place specialist breast care nurses wherever they’re needed.

When Hugh Bateman “pinked up Mudgee” last October, little did he know the chain reaction it would set off. So positive was the response, the McGrath Foundation is now rolling out the initiative across the country this October during breast cancer awareness month.

“REINSW is joining in and urging members to turn their town pink,” Hugh said. “Our aim is to create a powerful display of togetherness and support for families experiencing breast cancer.

“I’d urge every REINSW member to embrace the Pink Up Your Town initiative and support the McGrath Foundation.

“Everyone knows someone affected by breast cancer. This is a way for REINSW members to come together and raise money for the McGrath Foundation, which has such a positive impact on both individuals and families.”

The McGrath Foundation has helped more than 54,000 families since 2005. Today, they have 117 breast care nurses working with families at a cost of $12 million per year. But more needs to be

done. The McGrath Foundation estimates it needs 229 nurses to provide every family affected by breast cancer with access to specialist support.

Tracy Bevan, Ambassador and Founder of the McGrath Foundation, said Pink Up Your Town is about shining a pink spotlight in the local community to show support for those experiencing the impact of breast cancer.

“There are many communities that don’t have access to a breast care nurse,” Tracy said. “Forty-nine women are diagnosed with breast cancer every day and 144 men each year.

“We want to help and support everyone affected, and Pink Up Your Town is a way to get nurses to those communities that don’t have access.”

McGrath Breast Care Nurses help individuals and their families experiencing breast cancer by providing physical, psychological and emotional support from the time of diagnosis and throughout treatment. The service is free and you can self-refer.

In October 2016, Mudgee was the first town in Australia to turn pink and shine a light on the impact of breast cancer in their community.

businesses and organisations pa r t i c ipa t e d

R A I S E D

M o r e t h a n 200

collection tins

Auctions, raffles, morning teas and sausage sizzles

G A L A EVENT

Media mentions – radio, print, TV and online

PINK UP MUDGEE

124 18 / REAL ESTATE JOURNAL / Jul–Aug 2017

How to paint your town pink

Each committee will have access to downloadable online resources and the option to outfit their town with pink merchandise by purchasing a Pink Up Your Town Kit (including balloons, donation boxes, posters and more). You’ll also have access to a McGrath Foundation fundraising coach, who will be on hand to help you every step of the way.

You can register your interest in forming a local Pink Up Your Town Committee, by contacting Morgan Nowicki (McGrath Foundation’s Community Fundraiser) by calling (02) 8962 6117 or emailing [email protected].

To find out more, visit pinkupyourtown.com.au

2. SPREAD THE WORD

Start approaching local businesses and organisations, as well as media outlets, to encourage participation. You can do this through face-to-face meetings, email communications, social media and promotions in the local newspaper. You might also like to run a local competition for the ‘best pink business in town’.

3. START PLANNING

Stay on track by having a plan, for example:

• July 2017: Form your local committee

• July-August 2017: Finalise key events

• August-September 2017: Start promoting

• 1 October 2017: Launch event

• 31 October 2017: Wrap event

1. START A COMMITTEE

You can champion Pink Up Your Town by forming a committee to oversee the activation of the initiative in your local area. Reach out to key influencers like the local council, chamber of commerce, regional tourism office, key community groups, and other movers and shakers.


PERSPECTIVES / COVER PROFILEADVERTORIAL / REA GROUP

Put your property front and centre with Front Page“Generating maximum exposure for your listing is essential to all campaigns and with the introduction of Front Page, you can now take the lead in your suburb. Front Page is the ultimate way to get the right consumers viewing your listings on Australia’s number one property site – realestate.com.au” – Andrew Rechtman, Executive General Manager at realestate.com.au

realestate.com.au is putting property first with Front Page, giving agents the opportunity to advertise their properties front and centre on the realestate.com.au homepage.

Front Page listings are showcased to a highly relevant audience based on the smarts of realestate.com.au’s search results. This targeting, based off previous search behaviour ensures listings are showcased to highly relevant property seekers in your suburb.

For a Front Page listing to be displayed in any given suburb, consumers will need to have previously searched for a suburb in the Buy section. Once they return to realestate.com.au and search again in that suburb, your listing will be visible on the homepage.

With an audience of 16 million monthly home page visitors1, the homepage provides

the greatest exposure for you and your listing. Over a seven-day period you will hold the most exclusive position on the site for people searching in your targeted suburb.

With Front Page, a property will be advertised on the realestate.com.au homepage across all devices, including desktop, tablet, mobile and the realestate.com.au app (which has been downloaded more than 6.3 million times2).

The demand for Front Page has already proved high with agents, with campaigns now live across suburbs all over Australia.

If you are looking to take the lead in your suburb, find out more by visiting agent.realestate.com.au/front-page/ or speak to your Account Manager.

Disclaimer: Front Page is only available to Premiere customers1Adobe Analytics, average monthly visits to the home page (entire site), February 2016 to January 2017. Front Page targets users who have searched for your specified suburb(s) only. Actual visits to targeted suburb(s) will vary. 2Google Play and Apple iTunes Total App Downloads to February 2017

“Front Page provides our agents with unprecedented reach to showcase our vendors’ properties to buyers looking for homes in our key area. The exclusivity of Front Page gives us a great opportunity to further differentiate ourselves from our competitors.” MICHAEL CLARKE Principal at Clarke & Humel

“With an audience of over 16 million monthly home page visitors , the homepage provides the perfect place to target your listing.”


LOBBYING / FOCUS

Lobbying for equitable outcomes

Over the last two years, REINSW has been working closely with the NSW Government as part of the five-year statutory review of the Residential Tenancies Act 2010.

By TIM MCKIBBIN

The statutory review of the Residential Tenancies Act kicked off in June 2015, with NSW Fair Trading completing the review and releasing its recommendations for amendments to the Act in June 2016. Areas recommended for amendment were wide-ranging including pre-tenancy disclosure requirements, responsibility for the payment of water and utility charges, calculation of break fees, electronic service of notices and more.

Since the release of the recommendations, REINSW has met regularly with government officials to discuss the proposed amendments with a view to ensuring any Draft Bill reflects a fair balance between the interests of landlords, tenants, the profession and the market.

Domestic violence protectionsA major area earmarked by the government for amendment relates to the protections for victims of domestic violence. The review recommended amendments to make it easier for victims to either leave a violent home or end the tenancy of a violent co-tenant without financial penalty, and to avoid being penalised for damage to the property caused by domestic violence.

REINSW appreciates the devastating effects that domestic violence has and we support measures to protect victims. However we also need to be mindful of the rights of landlords as property owners and investors.

If the government’s proposed amendments move forward, the landlord will be expected to pay the costs associated with the protection afforded to a victim of domestic violence. If a property is damaged as a result of domestic violence, it is fair to say the damage incurred resulted from the tenant’s occupation of that property and

the activities that occurred there during that occupation. It is, in REINSW’s view, therefore not appropriate to expect landlords to bear the cost of repairing that damage. They should not be negatively impacted as a result of circumstances out of their control.

REINSW supports the well-established principle of ‘make good’, where it is the obligation of the tenant to make good the premises at the end of the lease and that the premises should be in the same condition as it were at the commencement of the lease – even in the case of domestic violence, which is beyond the control of the landlord.

Equitable outcomes for allThe proposed amendment has the potential to discourage residential property investors.

Investors are not limited in their investment choices to residential property. There are a myriad of other investment opportunities available. In the property market alone, in addition to residential property, there are also commercial, retail and industrial investment opportunities. That is to say nothing of other asset classes such as shares, bonds, cash, commodities and more.

It begs the question: Is it in the best interest of the market, which is in desperate need of additional stock, to discourage investment in residential property by imposing costs upon them for circumstances beyond their control?

Any amendment to the Residential Tenancies Act must result in equitable outcomes for all parties in order to create a better residential tenancy environment in NSW. We’ll continue to work closely with the government in the lead up to the release of the the final Draft Bill to ensure it fairly addresses the interests of all parties.

JUNE 2015 REINSW forms statutory review sub-committee

OCTOBER 2015 NSW Fair Trading releases Discussion Paper

JANUARY 2016 REINSW lodges submission in response to Discussion Paper

JUNE 2016 NSW Fair Trading releases recommendations

JANUARY 2017 REINSW submits Position Paper in response to recommendations

APRIL 2017 NSW Fair Trading provides Draft Bill to REINSW “in confidence”. REINSW lodges submission in response.

JUNE 2017 NSW Fair Trading provides second Draft Bill to REINSW “in confidence”. REINSW lodges submission in response.

Timeline to residential tenancies reform

READ REINSW’S SUBMISSIONSreinsw.com.au/submissions

TIM MCKIBBIN is the CEO of the Real Estate Institute of New South Wales.



EXPERIENCE takes more than just time

Calvin Coolidge, the 30th President of the United States of America, once said: “Knowledge comes, but wisdom lingers.” These words uttered in the 1920s still ring true today, as the real estate industry works toward the goal of achieving professional recognition.

By CATH DICKINSON

Espousing the importance of experience, President Coolidge went on to say that “it may not be difficult to store up in the mind a vast quantity of facts within a comparatively short time, but the ability to form judgements requires the severe discipline of hard work and the tempering heat of experience and maturity”.

“Experience counts,” REINSW President John Cunningham said. “We can never lose sight of that.

“Education and experience must come together if agents are to be recognised as professionals. There needs to be a marriage between theoretical learning and the experience an agent gains on the job.

“Learning is not the product of education alone. It’s also the product of activities completed by the learner. If an agent doesn’t have the benefit of theory, then they will do what they have been shown but will not understand why they’re doing it. Equally, if there’s an absence of practical experience, they’ll understand what needs to be done but won’t know how to do it.

“Practice makes perfect – or, more to the point, experience makes perfect.”

The Professional Standards Councils, with its agency the Professional Standards Authority, is the independent statutory body responsible for promoting professional standards. They use the 5 Es to define the elements that are necessary to qualify as a profession (see box on page 24).

“Experience is the third E and to be recognised as a profession, we must demonstrate that agents have the capability to practice at a professional level,” Mr Cunningham said.


FOCUS / PROFESSIONALISM

Education is not experience“Being competent and being capable are two different things,” Mr Cunningham said. “Yes, to be recognised as a professional you need to prove that, through your education, you are competent to perform the duties of an agent. But you also need to prove that you have the capability to perform those duties – and this capability comes through experience.”

Mr Cunningham noted that the training reform package announced in November 2016 includes a number of “experience requirements”, but explained that this was “something quite different to the experience that will be required to be proven for professional recognition”.

“Under the training reform package, to obtain a Real Estate Licence, agents will be required to complete a Certificate IV qualification and complete at least 12 months’ experience to be assessed as competent,” he explained. And if an agent wants to become a Licensee-in-charge, they will need to complete at least two years’ experience within a licensed business, in addition to completing a Diploma level qualification, to be deemed competent.

“Yes, the experience gained to achieve these educational qualifications will be extremely valuable. It will prove that agents are competent to carry out various aspects of their role. But the experience component of professional recognition will call for agents to prove capability at another level.

“Whereas education requires proof of competency at a particular point in time (being the time of assessment), professionalism requires proof of ongoing capability gained via

Education and experience must come together if agents are to be recognised as professionals. There needs to be a marriage between theoretical learning and the experience an agent gains on the job.


PERSPECTIVES / COVER PROFILEFOCUS / PROFESSIONALISM

BECOMING A PROFESSIONREINSW, in conjunction with REIA, are working with the Professional Standards Councils (PSC) and its agency, the Professional Standards Authority, to explore how real estate agents can be formally recognised as a profession.

The PSC uses the 5 Es to define the elements that are necessary to qualify as a profession. Over the course of 2017, we are featuring an article in each edition about one of the following Es to explain the pathway forward.

1 ETHICSThe prescribed professional and ethical standards that clients

rightfully expect their professional to exhibit.

2 EDUCATIONThe specific technical and professional requirements to

practice in a discrete professional area, linked to formal entry-level qualifications.

3 EXPERIENCEThe personal capabilities and expectations of experience

required to practice as a professional in a specific area.

4 EXAMINATIONThe mechanism by which qualifications and ongoing compliance

are assessed and assured to the community.

5ENTITYThere must be an entity, usually a professional association, capable

of overseeing and administering compliance expectations on behalf of consumers who rely on the professionals.

EVOLUTIONREINSW believes we need to add another E: evolution.

If real estate agents are to be recognised as professionals, then along with the 5 Es we must also embrace the reality that our industry must evolve. If we don’t collectively embrace a mindset of evolution, we simply won’t be in a position to commit to the work required to elevate ourselves to a recognised professional standard.

READ MORE about ethics: Mar-Apr 2017 edition, p 24.

READ MORE about education: May-Jun 2017 edition, p 24.

READ MORE about evolution: Jan-Feb 2017 edition, p 18.

the ongoing performance of duties, demonstrated skills, client feedback and more.”

Over the coming months, REINSW will be working with agents across the industry to define what the appropriate experience standards should be. These standards will then need to be approved by the Professional Standards Authority.

Price isn’t everythingAccording to Mr Cunningham, the real estate industry is currently suffering from the effects of the NSW Government’s focus on pleasing “the god of competition”.

“There’s no doubt that competition is an essential market force. But that competition must be competent and capable,” he said. “Those serving the community must have the experience to deliver the expected level of service to property consumers.

“For years, the government has been progressively lowering the barriers of entry to our industry in their dogged pursuit of exclusively serving the interests of competition,” he said.

“The end result? An industry full of under-educated, under-experienced, price-focused agents.

“Consumers are receiving a sub-standard level of service and, as a result, expect to pay lower fees – feeding a fee discounting culture.”

Mr Cunningham emphasised that price isn’t everything.“As agents, we’re providing a service-focused offering.

But, because of ever-declining standards of education and experience, what we do has evolved into a price-focused offering.

“It’s opened the doors to low levels of skill and even lower levels of performance purely based on process, rather than service and consumer outcomes.

“Improving the education requirements for entry into the industry is a great first step. But we also need to improve the experience levels of all agents – so they are both competent and capable, can effectively demonstrate their value to consumers and deliver a professional service.”

Mr Cunningham said that when you have a low-price offering and provide a low level of service, you’ll inevitably end up with poor consumer outcomes.

“I believe our ideal as an industry is to consistently provide a high-value service offering for a fee that fairly represents the value of the service performed.

“Experience is a key component in making this ideal a reality.”

I believe our ideal as an industry is to consistently provide a high-value service offering for a fee that fairly represents the value of the service performed.


Experience countsCEO of the Professional Standards Authority, Dr Deen Sanders OAM, explains how experience is defined in the context of the professionalism equation.

“Experience is not just about time spent,” Dr Sanders emphasised. “In the context of professionalism, experience is also about practical proof. It’s about proving that you have the appropriate level of knowledge and understanding about the obligations and rules of practice, and that you’ve demonstrated that you know how to act independently as a professional.”

By way of analogy, Dr Sanders provided the example of obtaining a drivers’ licence.

“Not only do you have to pass a written test to prove you have the requisite level of knowledge, you also have to fill in a log book showing that you have driven a certain number of hours under supervision in a variety of conditions. This acts as practical proof. It supports the conclusion that you are ready to drive independently and qualify for the designation as a licensed driver.

“After all, if we’re going to trust people to drive around our streets, we want to know that they have the experience to do it independently without someone sitting beside them ready to pull the handbrake if something goes wrong.

“We want to know that every driver has not only passed the written test to prove their knowledge, but has also proven they have the experience to drive independently.”

Drawing on this example, Dr Sanders explained it’s no different when it comes to the experience component of professionalism.

“A professional must be able to prove that they not only have the knowledge, but can also operate at the required level, independently and consistently,” he said.

Competence and experience are differentDr Sanders explained that there is a difference between experience and competence.

“Competence is a term we use in the context of vocational education,” he said. “To be deemed competent, you need to show that you can do something at the time of assessment. Your competency is assessed at a moment in time. Two days later, when everything you crammed into your head for the assessment is forgotten, you might no longer be competent.

“Professionalism requires evidence of ongoing competence – and that’s where experience comes in. A professional is competent and experienced. And the experience component proves that you’re able to perform the required functions independently and consistently, without supervision.”

Proving experienceIn many professions, evidence of experience is captured through supervision and mentoring. Some professions have formal supervision standards that must be met. Others require a supervisor or mentor to sign off on experience.

“To be recognised as a profession, the Professional Standards Authority looks at how experience standards are codified, monitored and signed off. What does it take for the profession to agree that someone meets the requisite experience standard to practise consistently and independently?”

Dr Sanders said one of the reasons experience is such an important

component of professionalism is because it “brings out the whole person”.

“This is critical. Many professions, including real estate, put a great deal of emphasis on interpersonal skills and other non-academic behaviours,” he said. “Someone might excel in the more academic and technical aspects of their chosen career, but fall short when it comes to the practical application of capabilities in the real world.”

Dr Sanders recalled an earlier time in his career when he was training to be a psychologist.

“To become an independent practising psychologist, I had to undergo two years of mandatory supervision,” he said. “That supervision didn’t mean I had someone watching over my shoulder every minute of the day. But it did mean there was someone there who I could talk to, ask questions of or discuss any issues or patients I was struggling with.

“And over the course of my internship, I realised that becoming a client practitioner psychologist wasn’t the professional role for me. It wasn’t what I wanted for my career.

“So experience is an important way of developing, and also testing, a person’s real world capabilities – and it’s these real-world capabilities that we’re looking for in the context of professional experience.

“The experience component of professionalism provides an opportunity for personal discovery. It’s as much a time to develop skills and capabilities as it is a time to make an informed decision about whether to commit to a career in the profession.”

Professionalism requires ongoing competence – and that’s where experience comes in. A professional is competent and experienced.


PERSPECTIVES / COVER PROFILEFOCUS / LEGAL

Double down on documentation

Showing a property to a potential buyer may seem innocent enough, but if you do it without having the right documentation in place beforehand you could find yourself on the wrong side of the law.

When it comes to listings, it’s important to quickly seize upon opportunities when they arise. And in a competitive market, where so many agents are vying to secure listings, it can be tempting to jump the gun.

Maybe it’s the property across the road from the home you successfully auctioned last Saturday. The owners watched the bidding with interest and you know the under-bidder is still keen to buy on the same street.

There’s nothing wrong with having a casual conversation with the owner, is there? “I have some buyers who would be very interested in this property,” you might tell them. “Let me just bring them around for a look.”

You don’t have an agency agreement in place with the owner and a valid contract for sale hasn’t been prepared, but that’s OK isn’t it? If the buyer is really interested, you can always sort the documentation out later. What harm is there in giving a potential buyer a quick sneak peak? After all, it will show the owner how proactive you are. Right?

Wrong!

Agency agreementBefore you can show a property to a potential buyer, you must have an agency agreement in place. No ifs, no buts – it’s a must.

If you show a property without an agency agreement in place, it can hit your hip pocket. Section 55(1) of the Property, Stock and Business Agents Act 2002 states that a licensee is not entitled to commission unless there is a written agency agreement in place.

But it’s not just about commission.Having a valid agency agreement doesn’t just

secure your entitlement to commission, it also provides you with a range of protections should

something happen during an inspection. What if the potential buyer trips down the front stairs and breaks their leg? What if they slip on the decking and hit their head on the edge of the pool as they fall in? The number of ‘what ifs’ is potentially unlimited.

The REINSW agency agreement provides you with comprehensive protection should a ‘what if’ arise. You are indemnified against any actions and claims made against you in the proper performance of your duties. Detailed privacy terms, work health and safety provisions and material fact disclosure requirements also ensure you are protected.

Contract for saleA valid contract for sale is also a must before any inspection can take place.

Section 63(2) requires a valid contract for sale to be available for inspection at all times when an offer to purchase the property may be made. Under section 63(3), an agent is considered to offer a property for sale when, expressly or by implication, they indicate that the property is for sale or is to be auctioned at any future time, they offer to sell the property or they invite offers to purchase. If you fail to comply with section 63, you could be subject to a substantial penalty.

Don’t risk itWhile it may be tempting to show a property to a potential buyer before you have all the necessary documentation in place, you should never do it. It’s not worth risking your commission, opening yourself up to potential claims or facing the possibility of a penalty. Having processes in place at your agency to ensure both an agency agreement and contract for sale are in place before you start offering a property for sale will ensure you stay on the right side of the law.

By ROBERT ANDERSON and ANN BANISTER

CALL THE HELPLINEDid you know that as a member you can call the REINSW Helpline as often as you need to?

The Helpline team is highly experienced and very skilled. They’ve been in your shoes and can offer straightforward, real world advice on tenancy issues, sales matters, agency agreements, tribunal hearings, strata questions, the impact of legislation changes and much more.

No question is too big or too small and there’s no limit to the number of times you can contact the Helpline.

the Helpline on (02) 9264 2343 or email [email protected]

CONTACT

Find out more about the REINSW agency agreement at reinsw.com.au/store


PROPERTY, STOCK AND BUSINESS AGENTS ACT 2002SECTION 55 – NO ENTITLEMENT TO COMMISSION OR EXPENSES WITHOUT AGENCY AGREEMENT(1) A licensee is not entitled to any commission or expenses from a person for or

in connection with services performed by the licensee in the capacity of licensee for or on behalf of the person unless:

(a) the services were performed pursuant to an agreement in writing (an “agency agreement”) signed by or on behalf of:

(i) the person; and

(ii) the licensee, and

(b) the agency agreement complies with any applicable requirements of the regulations, and

(c) a copy of the agency agreement signed by or on behalf of the licensee was served by the licensee on that person within 48 hours after the agreement was signed by or on behalf of the person.

SECTION 63 – PROPOSED CONTRACT FOR SALE OF RESIDENTIAL PROPERTY(2) A real estate agent must not offer residential property for sale unless the required

documents* are all available for inspection at the real estate agent’s registered office by a prospective purchaser or agency for a prospective purchaser at all times at which an offer to purchase the property may be made (or at such other place or at such other times as may be prescribed by the regulations).

[* emphasis added – “required documents” include “a copy of the proposed contract for the sale of property” in accordance with section 63(4)(a)]

(3) A real estate agent is considered to offer residential property for sale when the agent, expressly or by implication:

(a) indicates that residential property is for sale or is to be auctioned at any future time, or

(b) offers to sell residential property, or

(c) invites an offer to purchase residential property, or

(d) indicates that a person may be willing to grant an option to purchase residential property.

ROBERT ANDERSON and ANN BANISTER are consultants on the REINSW member-only Helpline.

Before you can show a property to a potential buyer, you must have an agency agreement in place. No ifs, no buts – it’s a must.

28 / REAL ESTATE JOURNAL / Jan–Feb 2016

Research from the Housing Industry Association shows that it now costs almost $48,000 per year to service a typical loan on a median priced house in Sydney – so it’s not surprising that anxiety about housing affordability is at an all-time high.

“I think the NSW Government thought that if they ignored the problem for long enough, it would go away. But the problem has just continued to grow,” REINSW CEO Tim McKibbin said.

“REINSW has been monitoring housing affordability for more than 15 years. We’ve witnessed the social and economic effects of the ever-growing crisis, but despite our efforts to highlight the inadequacies of government responses there’s been little action.

“The recent moves by the NSW Government to address housing affordability are a step in the right direction, but it’s time to really get serious.

“All levels of government need to collectively address housing affordability, because one of our most basic human requirements, other than food and water, is shelter.”

Mr McKibbin believes that part of the reason governments at all levels have been so slow to act is because of the sheer magnitude of the problem.

“Some of the required measures, such as addressing the planning system, are politically

FOCUS / HOUSING AFFORDABILITY

Brick by brick: Tackling the crisisThe housing affordability crisis hasn’t happened overnight. It’s been a problem that’s been building – brick by brick for many years. But, despite this, it seems to have crept up on those in power.

By HELEN HULL

unpopular – and this has stymied positive action to address housing affordability.

“It’s time to end the politics and take the steps that are needed to secure the housing market and address the ever-worsening housing affordability crisis.”

NSW Government’s responseIn her maiden press conference in January 2017, Premier Gladys Berejiklian identified housing affordability as “the biggest issue people have across the state”.

“I want to make sure that every average, hard-working person in this state can aspire to own their own home,” she said. “That’s something I valued and worked hard to do and I want to make sure everyone else has that opportunity as well.”

Fast-forward six months and the Premier, Treasurer Dominic Perrottet and Minister for Planning and Housing Anthony Roberts released the housing affordability package ahead of the 2017 NSW Budget.

From the 1 July 2017, the package will:• abolish stamp duty for first homebuyers on

existing and new homes up to $650,000• provide stamp duty discounts for first

homebuyers on existing and new homes up to $800,000

• abolish the stamp duty charged on lenders’ mortgage insurance

• double the foreign investor surcharge from 4 per cent to 8 percent on stamp duty, and from 0.75 per cent to 2 per cent on land tax

• remove stamp duty concessions for investors purchasing off the plan

• provide a $10,000 grant for builders of new homes up to $750,000 and purchasers of new homes up to $600,000

• no longer allow investors to defer paying stamp duty on off-the-plan purchases.The Premier said the measures focused on

supporting first homebuyers “with new and better targeted grants and concessions” and will have the effect of “turbocharging housing supply to put downward pressure on prices and delivering more infrastructure to support the faster construction of new homes.”

Dr Andrew Wilson, Chief Economist at Domain Group, described the changes to stamp duty for first homebuyers as a “real reversal” from 2011, when the government took away the stamp duty concessions for established homes.

“First homebuyer activity is at record low levels in the Sydney market,” he said. “The longer-term

average for first homebuyers in the market from ABS data available since 1992, is around 30,000 per year. Last year we saw just 16,000. The horse has bolted and there’s nothing we can do to get back to the first homebuyer levels we’ve previously seen in the market.

“The policy position of the NSW Government is clearly politically driven. It’s a political response to what has been a vigorous debate surrounding the housing market.”

But according to Dr Wilson, the changes aren’t going to make much of a difference at all.

“With relatively high prices in Sydney, the barriers to entry for first homebuyers remain steep, so there’s the likelihood of a moderate increase in activity at best. But increased demand levels with fixed supply will certainly continue to result in price growth, which in the longer term will only act to constrain first homebuyer activity.

“The problem will continue into the future because we don’t have enough houses. We need to start looking carefully at the supply side.”

Forgotten victimsAccording to Dr Andrew Wilson, renters are the forgotten victims and we’re on the verge of a rental crisis.

“In the city, rental affordability is at crisis levels – it’s never been tougher,” he said. “Rents are increasing faster than wage growth and renters in Sydney are paying 30 per cent more than those in Melbourne and Brisbane on the same income.

“We’re seeing supply issues in the rental market. We need to stop thinking of investors as the ‘bad guys’. If we want international investors – and believe me, we do want them – we need to stop trying to work within a framework driven by short-term political expediency.”

Impact on agentsTim McKibbin said agents are also bearing the brunt of the housing affordability crisis.

“There’s very little stock and, as a result, agents are finding it hard to source property for consumers,” he said. “People don’t want to be out of the market for very long. Consumers want to buy before they sell, and the biggest problem isn’t selling their home – it’s buying the next one. And because they can’t buy, they don’t want to sell.

“All levels of government have to work on this problem. We need to take the politics out of it and see strong leadership and good economic sense,” Mr McKibbin said.

The policy position of the NSW Government is clearly politically driven. It’s a political response to what has been a vigorous debate surrounding the housing market.

DR ANDREW WILSON Chief Economist at Domain


MARCH QUARTER 2017 MARCH QUARTER 2016

Home Loan Affordability Indicator 27.7 26.7

Average HLAI since December quarter 1996 29.0% 29.1

Proportion of family income devoted to meeting average loan repayments 36.1% 37.4%

Proportion of family income devoted to meeting median rents 28.4% 29.0%

Median weekly family income $1,688 $1,653

Average monthly loan repayment $2,643 $2,682

Average loan $443,400 $429,436

Total number of loans (excluding refinancing) 29,140 27,312

Number of loans to first homebuyers 3,597 3,795

Average first homebuyer loan $361,033 $352,667

SUPPLY IS THE KEYMinister for Planning and Housing Anthony Roberts said supply is the key lever to be pulled when tackling housing affordability.

“The NSW Government is helping to address the challenge of housing affordability by increasing housing supply – delivering more than 70,000 approvals in NSW every year,” he said. “Low levels of new residential construction between 2006 and 2011 and strong population growth has meant that there is a pent-up demand for homes in NSW, mainly in Sydney.

“More will be done to increase housing supply and affordability. We’ll be doing this through land releases, faster housing approvals, cutting red tape, medium density houses, rezoning, and funding for local infrastructure such as roads and schools.”

According to Minister Roberts, the government is also working to ensure that there’s an adequate and diverse supply of suitable housing options for all residents.

“Currently, most new homes built in NSW tend to fall into two categories: traditional free-standing houses or apartments. What’s missing is the range of housing types that fall between these two categories: terrace houses, townhouses, manor homes, villas, and dual-occupancy homes.

“The recently released draft Medium Density Design Guide and housing code will make well-designed low-rise medium density homes a reality through Sydney’s middle-ring suburbs and beyond.

“This is a more affordable option for people looking to own their own home without missing out on space for their family to grow, have a backyard and car parking,” he said.

$1,98723.4%

ACT

$1,64426.7%

$2,08621.1%

$1,68836.1%

$2,61920.1%

$1,63932.5%

$1,38023.6%

$2,54526.2%

Australia wide

$1,68830.4%

Median weekly family income

Proportion of family income required to pay loan

National snapshot

Source: Adelaide Bank/REIA Housing Affordability Report (March 2017 quarter)

NEW SOUTH WALES AFFORDABILITY INDICATORS

FOCUS / HOUSING AFFORDABILITY


What are the options?Both the state and federal governments have been promising action on housing affordability for years. But what policy options are available? Here are just some.

ABOLISH STAMP DUTYStudy after study shows that stamp duty is one of the single biggest problems in the housing affordability equation. Stamp duty on a median-priced Sydney house is now more than $40,000. While it’s a windfall for government, it discourages people from selling.

A switch from stamp duty to a broad-based land tax would reduce the upfront cost of purchasing a property, encourage land to be put to its most productive use and help improve housing affordability over time.

INCREASE HOUSING SUPPLYPoliticians of every persuasion talk endlessly about the importance of increasing the supply of housing. They are correct. We do need more housing – but it needs to be in the right places.

While the number of dwellings built in Sydney over the past five years has increased, the new supply is not all in areas of most demand. According to John Daley, the Chief Executive of the Grattan Institute, substantial demand for housing in middle-ring suburbs is not being met. He has said good planning that allows for a significant increase in housing supply in the middle-ring would be a “game changer” for housing affordability.

MORE PUBLIC HOUSINGIn a curious twist, while investors have been piling into the market over recent years, governments have been reducing their public housing stock. Today there are 16,000 fewer public housing dwellings across the nation than there were in 2009 and there is a national waiting list approaching 200,000.

Allowing public housing providers to borrow at lower rates if they then rent to essential workers (such as teachers and nurses) would demonstrate a serious commitment to solving the housing affordability crisis.

REDUCE CAPITAL GAINS TAXThe 50 per cent capital gains tax discount was introduced by the Howard Government back in 1999 and has enhanced the appeal of property investment. But according to independent economist Saul Eslake, this preferential treatment of capital gains distorts savings and investment decisions and detracts from the overall equity of Australia’s personal income tax system.

The 2010 review of the tax system by former Treasury head Ken Henry recommended that the capital gains discount be reduced to 40 per cent – and many experts believe there’s a need to go even further. Paring back the discount would ease pressure on housing prices by making property investment less attractive and, in so doing, limit upward pressure on property values.

CAP NEGATIVE GEARINGMany economists have called for an end to negative gearing. They argue that if a reduction of the capital gains tax discount fails to curb excessive investor demand for housing, then changes to negative gearing could be considered.

While the Reserve Bank of Australia has said that there’s a case for reviewing negative gearing, there are also good arguments for leaving it alone. Negative gearing, by running losses in the short term, works as an investment strategy if the property eventually appreciates in value enough to overcome those losses. It’s the prospect of capital gains that are the driver for investing in property, which could be better addressed by reducing the capital gains tax discount rather than tinkering with negative gearing.

But, according to some economists, a sensible cap on the number of properties that can be negatively geared could help curb some of the worst excesses in the market.

GRANTS FOR FIRST HOMEBUYERSEconomist Saul Eslake has noted that governments have experimented with “demand side interventions” for decades without success, including cash handouts in the form of first homebuyer grants and stamp duty exemptions and concessions. But these have failed to stop the steady decline of first homebuyers.

Mr Eslake has commented that it’s difficult to justify the continuation of a policy in the face of overwhelming evidence that it doesn’t work.

ACCESS TO SUPERANNUATIONAllowing first homebuyers to use their superannuation to fund a deposit is not a new idea. But most economists decry it. The Grattan Institute’s John Daley has called it a “bad idea” and economist Saul Eslake has labelled it “fundamentally bad”.

The reason? A policy that gives a large number of potential buyers more money to spend in a competitive market is likely to push prices up. Most agree that superannuation should be left to do what it was designed to do – provide a stream of income during retirement.

LEVY FOREIGN INVESTMENTThe housing market in NSW has attracted a lot of interest from foreign investors, particularly from China, in recent years – and this interest is likely to grow as China becomes more integrated into the global economy.

Research from Credit Suisse in March 2017 found that foreigners are buying 25 per cent of new housing supply in NSW, and almost 80 per cent of foreign demand is from China. According to Credit Suisse, there is good reason to expect more – not less – Chinese demand going forward.

This means higher levies on foreign investment in housing may be justified to ensure local homebuyers are not disadvantaged.


PERSPECTIVES / COVER PROFILEFOCUS / DATA

Agent extinction: Hype vs realityWith the number of self-selling websites steadily on the rise, the question must be asked: are real estate agents on the verge of becoming obsolete?

By PATRICK HILL

With each passing week, we seem to hear more hype about the rise of self-selling websites with buymyplace.com.au, forsalebyowner.com.au, agentinabox.com.au and many others all vying for a piece of the lucrative real estate pie. Vendors excitedly tell stories of their self-selling success, giving rise to the myth that “selling real estate is easy” and “anyone can do it”.

But what does the emergence of these sites mean for agents? Will the major portals follow suit? Is this the future of real estate?

Revealing dataThere’s no doubt the low cost of self-selling can be enticing for some vendors. The chance to save thousands of dollars in agent fees is enough to turn heads. If an agent’s fee is two per cent, the chance to save up to $20,000 on a million dollar sale can sound like good value. But is it?

I decided to put this ‘value’ to the test by analysing a random selection of data sourced from both real estate agencies and self-selling websites. Examining areas across New South Wales, I soon discovered that self-sales were only a very small percentage of overall sales – less than 0.1 per cent in the most active region of Sydney. In fact, of the 500,000 homes sold in Australia in the year to November 2015, only just more than 5300 were sold without an agent.* The most active areas for self-selling were lower income areas.

The data showed that vendors who used an agent sold their property for a higher price than self-selling vendors. This trend was consistent across different suburbs, property types and property features, with agents securing between $55,000 to $250,000 more than self-sellers for similar properties. While these results may be due

to different factors, such as self-selling vendors being motivated to sell quickly due to financial stress or their general inexperience, the data is telling.

What a good agent can doIn real estate, as in so many other areas of life, it pays to work with an expert.

According to Brett Hunter, Principal of Raine & Horne Terrigal – Avoca Beach and REINSW Deputy President, agents have particular expertise when it comes to achieving the best price.

“Vendors don’t sell multiple homes week in, week out,” Mr Hunter said. “Agents do. They have the benefit of experience when it comes to pricing, marketing and negotiation.

“What many owners don’t realise is that selling a house is about more than finding one purchaser.

“Yes, you can run an auction with a single registered bidder, but a higher sale price will inevitably be achieved when multiple bidders are vying against each other. Bringing multiple potential purchasers into the mix helps push the ultimate purchaser into an emotional price bracket. This is what a skilled agent does well.”

Mr Hunter added that vendors also find that the ‘arm’s length’ relationship between the agent and purchaser can help reduce the stress of the situation. This can facilitate the process of selling at a higher price.

“Understanding what purchasers are looking for, knowing how to present a property, creating a targeted marketing campaign and negotiating effectively are also benefits of working with an agent rather than self-selling. It all comes together to achieve a higher sale price.”

While it may initially be tempting to save money on an agent’s fee, most people don’t want to take a gamble with their most valuable asset and possibly end up with a poor sale price.


Selling property is not about saving money, but rather maximising the sale price, Mr Hunter explained.

“A slight saving on agent fees just doesn’t stack up against a sale price that’s potentially 10 or 15 per cent higher,” he said. “Having a database of potential purchasers who are keen to move quickly is something an agent can bring to the table, which self-selling vendors can’t.”

Evidencing value with dataIt’s only fair for vendors to question if they’re receiving value from their agent – but it can be difficult to identify what that value is. I know. I’ve been there myself.

Back in 2015, when my wife and I were selling our home, we interviewed three agents. Each pitched in exactly the same way and presented almost identical sales reports. We wanted to make our decision based upon intelligent analysis, but we honestly couldn’t tell them apart. In the end, we chose the agent who seemed a bit more enthusiastic than the others. I was left wondering why none of them could differentiate themselves from the others and why they were unable to explain the value they could provide.

Where was their data? Asking myself this one simple question led to the creation of Real Insights – a software tool that equips agents with the data they need to evidence their value. Through the segmentation and analysis of sales data, agents can differentiate themselves from their competitors in a multitude of ways. It’s all about equipping agents with compelling data about their comparative performance and sales track record. And presented with this critical data, vendors can choose an agent with superior negotiation skills who will bring them

an above-market sale. They can make a truly informed choice.

While there’s a lot of talk right now about big data and data science, there’s not a lot of understanding as to what it actually is and what it can do for agents. I believe harnessing the true power of data will be the biggest innovation the real estate industry experiences in the coming years.

Future threat?Most vendors know, at least on some level, they don’t have the appropriate skills to sell their own property, nor do they have the time. This much is reflected in the data. While it may initially be tempting to save money on an agent’s fee, most people don’t want to take a gamble with their most valuable asset and possibly end up with a poor sale price. And vendors who have previously worked with a skilled and well-trained agent know how hard they work to deliver a great result.

At the end of the day, consumers will decide how self-selling models work in the market and how they compare to the value proposition of real estate agents. While an easily commoditised, transactional industry can be quickly replaced by technology, it must be remembered that real estate is not a commodity. If the real estate industry operates at a highly professional level, produces a top result and focuses on service, its value will easily be buffered from ‘uber-isation’.

Self-selling websites may continue to grab headlines in the short term, but I believe people will continue to overwhelmingly favour a skilled agent’s experience and expertise, and will be willing to pay for it – providing agents can empirically demonstrate their value.

* Source: whichrealestateagent.com.au

PATRICK HILL is the Director at Real Insights.

Find out more about Real Insights at realinsights.com.au

People will continue to overwhelmingly favour a skilled agent’s experience and expertise, and will be willing to pay for it – providing agents can empirically demonstrate their value.


PERSPECTIVES / COVER PROFILEFOCUS / COMMERCIAL

Co-working spaces: The new ‘corporate cool’With the number of co-working offices on the rise around the world, we look into the concept of shared, collaborative workspaces, what’s driving their popularity and the impact on the office market.

By CATH DICKINSON

Co-working spaces in Australia have become a notable trend in today’s office market. Unlike the traditional nine-to-five office environment, these spaces are a productivity hub for multiple businesses, start-ups, small teams and entrepreneurs looking to work independently in a shared office environment.

“Co-working spaces offer individuals and businesses the chance to work in a fully-equipped office,” Kymbal Dunne, Director of Office Leasing at Knight Frank, explained. “Setting up an office can be frustrating, time consuming and expensive, but with co-working spaces everything is already set up and it’s effectively ‘plug and play’. Pricing models, which charge members by the workstation or office, generally include services such as security, reception, high-speed internet, printing, café and common area facilities, conference rooms, lounge areas, cleaning services and more.

“There’s a lot of buzz about co-working, particularly recently, but it’s not a new phenomenon. The first co-working spaces opened in Australia more than a decade ago – and since then we’ve seen spaces pop up across the country and become more and more popular.”

So what are the key drivers fuelling the rise of co-working and what are the potential impacts for the commercial property market?

Creating a communityCo-working spaces are much more than an alternative to the traditional serviced office. Over the years they’ve evolved into communities of ambitious and driven individuals, creating

prime opportunities for businesses to establish connections, expand their contacts and grow their business without the overhead costs that come with traditional office spaces.

“The desire to feel part of a community is a big reason why people choose to co-work,” Kymbal explained. “Each co-working space has its own vibe and operators deliberately cultivate a unique experience that meets the needs of their members.

“Co-working operators go out of their way to create a genuine community. ‘All work and no play’ is not something you’ll experience in these spaces. From the way the facilities are laid out to regular social events and on-site educational sessions, everything is aimed at creating a place where people work to make a life, not just a living.

“Importantly, co-workers can choose when and how they want to interact with others. They might enjoy a discussion with someone over a coffee in the on-site café or in one of the many common areas, but there’s also plenty of opportunity for solo time.”

The advent of the internet in the 1990s prompted forecasts that working from home would lead to a rapid fall in the demand for office space. But it hasn’t eventuated because humans, by nature, crave interaction. While people may sometimes be more productive when they’re alone, they’re more collaborative and innovative when they’re together.

“When you work in a co-working space, you’re surrounded by an incredibly diverse ecosystem of people,” Kymbal said. “The environment is specifically created to enhance the ability to interact with others in a professional and productive setting.

Each co-working space has its own vibe and operators deliberately cultivate a unique experience that meets the needs of their members.


“Co-workers find themselves connecting with potential clients, suppliers or even new business partners. In a co-working space, you’re guaranteed to connect with talented and like-minded people to add to your network. You never know who you’ll meet and how you might be able to collaborate.”

Changing office marketOnce the domain of creatives and freelancers, co-working spaces have become an attractive, practical and affordable alternative to conventional offices for more traditional and established businesses.

“At Knight Frank, our figures show that almost 90 per cent of tenants in the market are businesses that employ less than 20 people, and a big proportion of those employ four or fewer,” Kymbal said. “Is it economically viable to have your own dedicated office space at that size? When you factor in all the costs of a traditional office space – rent, insurance, IT and more – it’s easy to see why a co-working environment is a very attractive alternative.

Today’s worker wants an environment that’s not only flexible, creative and collaborative, but also affordable – and co-working spaces provide all of this and more.

“Flexibility is another plus because businesses can grow or contract as needed and they have access to floor space and facilities on an as-needs basis.”

But it’s not just small and micro businesses that are enjoying the benefits of co-working environments. Some well-known global corporations have been moving out of their dedicated office buildings and into co-working hubs.

“In the US, technology giant IBM recently signed a deal with WeWork – the world’s largest co-working operator – to accommodate more than 600 employees,” Kymbal said. “Rather than managing their own office facilities, they see the benefits in moving to a co-working space and letting WeWork do it for them. I think it’s something we’ll definitely see happen here before too long.

“The way people work has shifted. Today’s worker wants an environment that’s not only flexible, creative and collaborative, but also affordable – and co-working spaces provide all of this and more.”


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INSURANCE / FOCUS

Tracking your tradiesEmployee fraud is a risk all agencies face and a recent claim highlights how important it is for all agencies to have the right checks and balances in place to avoid falling victim.

By NANCY RAINBIRD

You might think “it will never happen to me”, but that’s not necessarily true. A recent case that came to Realcover’s attention shows just how easy it is for an agency to fall victim to employee fraud.

An agency Principal advised Realcover that one of their property managers had perpetrated a significant fraud. The property manager had managed to direct approximately $80,000 from the agency’s trust account into their own bank account.

The property manager looked after about 250 properties and, as part of their duties, was responsible for arranging repairs. Payment of any repairs was authorised by the property manager when the invoice was presented and the authorised invoice was then forwarded to the accounts team for payment.

It was discovered that the property manager had been authorising payment of invoices for repairs that were never undertaken. The invoices were all paid to the same tradesperson, who was the property manager’s partner. The payments were made to their joint bank account.

DISCLAIMERWhile care has been taken in preparing this article, and the information in it has been obtained from sources that Realcover believe to be reliable, Realcover does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose that the article may be used. Realcover accepts no liability for any loss or damage (whether caused by negligence or not) resulting from the use of this article.

REALCOVER’S professional indemnity insurance is issued by QBE Insurance (Australia) Ltd. Protect your business with professional indemnity insurance designed with your needs in mind. When it is time to renew your policy, contact Realcover on 1800 990 312 for a quote REINSW members are eligible for a substantial discount off the standard professional indemnity insurance premium (excluding charges).

NANCY RAINBIRD is the Claims & Compliance Manager at Realcover.

Tips to minimise your riskThere are some simple steps you can take to ensure you don’t fall victim to a similar situation:

1Record the tradie’s detailsEach time you engage a new tradesperson, be sure to record

all their relevant details on a dedicated form. The name of the tradie, their address, ABN, bank account details, telephone number and any other contact details should be recorded on the form. Once the form is completed, it should be signed off by the Principal or office manager.

2 Check the tradie’s ABNIt’s also important to check the tradesperson’s ABN by going

to abr.business.gov.au. In this case, a simple ABN check would have revealed that the tradie’s surname on the fraudulent invoices was the same as the property manager’s surname – an obvious red flag!

3Changing bank account detailsStaff committing fraud will often attempt to substitute their own

bank account details for the valid details of a tradesperson. Any changes to a tradie’s bank account details should be recorded on their form (see point 1 above), with a notation that the request was made by the tradesperson themselves. The Principal or office manager should then call the tradie to confirm the request is valid.

4Cross check bank account detailsAs an additional level of control,

the Principal or office manager should also cross check the tradie’s bank account details against the payroll records of all property management staff.

5Dual signatoriesYou should always require two signatories for all payments made

by your agency, and each payment should be supported by a valid tax invoice that the second signatory checks before signing off.

6Regular work reviewsBe sure to periodically check the work of your property managers

and ensure trust account reconciliations are reviewed and signed off each month. Also ensure bond reconciliations are completed in a timely manner and undergo a double check.


The power of online learning

There are many different methods of learning and each has its own merits. One of the biggest barriers to learning in a classroom setting is finding the time. That’s why we offer eLearning, which allows agents to complete CPD courses on their computer at a time that best suits them.

By DANIELLE ANDREWS

What are the benefits?The biggest benefit of online learning is convenience. We know that life as a real estate agent is busy, with very little free time. That’s why eLearning is so popular with agents who have busy schedules or are regionally based.

It also allows learners to undertake the course when they want to, because there’s no waiting time. You can start whenever you want – first thing in the morning, last thing at night or any time in between.

eLearning is growing in popularity every year and currently about 35 per cent of our CPD registrants study this way. And by this time next year, we expect it will increase to 50 per cent.

Currently we offer a wide variety of eLearning CPD courses including:• Coaching your team to success• How to be a great receptionist• Legal aspects of commercial real estate• Property manager law and practice update• Underquoting – What you need to know• Master the basics of WHS• Motivating your employees• Building customer loyalty with your CRM• Effective conflict resolution• How to get more done and stay sane.

CPD webinar bundlesREINSW recently trialled a new online commercial CPD course, which packaged together four commercial webinar videos into an online course for 12 CPD points. This has proven to be a very popular format with agents, as they are learning from the experts in their field in an interesting video format.

As a result, we’ll soon be offering more CPD webinar bundles. These will include individual courses offering 3 to 12 CPD points each. The following is a list of those planned over the next few months:• Tips for vendor paid advertising• Best tips to managing difficult situations• How to complete a sales agency agreement

and How to complete a management agency agreement

• Electronic signatures and When you can use online contracts

• Avoid costly negligence claims, Avoid commercial claims and Managing agents’ professional negligence claims

• National employment, Commission only and Bullying and harassment

• Breach of tenancy, Non-payment of rent, Prepare for NCAT and Present at NCAT.

To find out more, please visit reinsw.com.au/elearningcpd

DANIELLE ANDREWS is the REINSW Education & Training Manager.

REINSW RUNS REGULAR WEBINARS REINSW runs regular webinars, giving you access to live and interactive training without having to leave your home or office.

Webinars are free to members.

Find out more at reinsw.com.au/webinars

eLearning is growing in popularity every year and currently about 35 per cent of our CPD registrants study this way.


TRAINING AND EVENTS / UPDATE

CALENDAR / TRAINING AND EVENTS

Find out moreTo find out more about any of REINSW’s courses:

reinsw.com.au

(02) 9264 2343

[email protected]

Keep learning

Earn your Real Estate LicenceDo you want an edge over your competitors to set yourself apart from other agents? Complete the CPP40307 Certificate IV in Property Services (Real Estate) qualification and obtain your Real Estate Licence.

You can enrol at any point in the year and will attain your qualification by successfully completing all the necessary short courses over a 12-month period.

When? Enrol at any point in the year and complete units in the order you choose

Where? REI House 30-32 Wentworth Avenue Sydney

Prerequisites? You must hold a Certificate of Registration

To find out more, go to reinsw.com.au/licence

Each short course takes 3-5 days and

forms part of the CPP40307 Certificate IV

in Property Services (Real Estate).

Recognition of Prior LearningREINSW has a flexible approach to helping you upgrade your qualifications and doesn’t believe you should have to spend time re-learning things you already know.

If you already have experience in real estate, it can be recognised via our Recognition of Prior Learning program to help you gain your Real Estate Licence.

All you need to do is enrol in the RPL program and complete a self-assessment on your skills, which an REINSW assessor will then review.

You will then be advised of the outcome and a plan will be put into place to assess your skills and knowledge, so that you can be issued with the relevant credentials for the units of competency for which you have received via RPL.

To find out more about RPL, go to reinsw.com.au/rpl

Novice Auctioneers Competition State FinalREINSW will be hosting the annual Novice Auctioneers Competition (NAC) State Final on 10 August 2017 at The Police and Justice Museum in Sydney.

This year there will be the 10 heat winners, plus wildcards, competing to impress the judges and be crowned the NSW champion.

Previous winners and finalists have gone on to have stellar careers as auctioneers, including Damien Cooley (Cooley Auctions) and Jesse Davidson (auctionWORKS).

This year the charity for all funds raised from each auction is the McGrath Foundation. Attendees are encouraged to bid on all of the items.

The NSW champion will receive $1,000 prize money and:

• Conduct the charity auction at the REINSW Women in Real Estate Conference

• Receive two complimentary tickets to the REINSW Awards for Excellence dinner.

For more information, email [email protected] or visit reinsw.com.au/nac

RTO ProviderNumber: 90117*

This training is recognised within the Australian Qualifications Framework

RTO: The Real Estate Institute of New South Wales Ltd


FREE FOR REINSW

MEMBERS

NEW MEMBERS / LAST WORD

Today the real estate business is more competitive than ever before and membership of REINSW has never been more important. We’re proud to welcome the following agencies to our membership ranks.

365 Property Group, Alexandria

Acclaimed Property Management, Earlwood

Active Real Estate, Eastwood

Annuity Property Group, Balgowlah

Awaba Properties, Neutral Bay

Beach To Bay, Wagstaffe

Belle Property Woollongong, Wollongong

Bowmans, Griffith

Bowral Estates, Bowral

Brady Property, Alexandria

Cathy Maria Real Estate, Mannering Park

Condobolin Properties Plus, Condobolin

Dean Starr Joseph Carver, Menai

Different, Sydney

Dreizi Properties, Towradgi

Eastcastle Property, Wahroonga

First National Altitude, Warners Bay

Fish & Nagle Cooma, Cooma

Guardian Realty Castle Hill, Castle Hill

Guest Management Sydney, Waterloo

Hannaford Stock and Land Australia, Gloucester

Ian Simpson & Co Property Management, Forbes

Inc RE, Sydney

Jenling Real Estate, Taren Point

Laing+Simmons Liverpool, Liverpool

LJ Hooker Kellyville/Stanhope Gardens, Stanhope Gardens

LJ Hooker Liverpool, Liverpool

Navigate Property, Sydney

Nicole Abbott, Potsville

NW Real Estate, Carlingford

One Agency Josh Fitzgerald, Orange

One Agency Tamara Le Boursicot Property, North Willoughby

Oracodes Realty, Wentworth Point

Premier Property Buyers Agents, Caringbah

Professionals Harrington, Harrington

Property Developer HQ, Randwick

Property Excellence, Moree

Public Realty, Kensington

Raine & Horne Ocean Shores/Brunswick Heads,

Ocean Shores

Raine & Horne, Grosvenor Place

Raven Real Estate, Picnic Point

Ray White Commercial (NSW-Sydney City Fringe), Glebe

Ray White Rhodes, Rhodes

Real Estate Goulburn, Long Beach

Richardson & Wrench Chatswood, Chatswood

RPS Roberts Property Services, Woonona

Savills Gold Coast, Southport

Sello, Killara

Sydney Auctioneers, Kingswood

Sydney Strata, Cherrybrook

Terra Sales, Ryde

The Madison Agency, Seaforth

Trounson Realty, Capertee

Wiseberry Penrith, Richmond

WJ Property International, Roseville

Your Property Your Wealth, Tahmoor

The agencies listed took out membership in April and May 2017.

New members


What’s the buzz?The impact of buyer demand on property prices has been in the news over recent weeks as the housing affordability debate continues. The value an agent brings to the transaction and the effect of disruptive technologies also made headlines.

We are in a time-poor world … and the whole selling and buying process is one of the [most] emotionally charged things people ever do. Private sellers tend to overprice and thus they miss the market. [They] are making the most costly mistake in their lives.

JOHN CUNNINGHAM REINSW PresidentMeet the property sellers dumping agents The Guardian, 17 June 2017

[The change* means there is] a lot more work involved from the solicitor’s and conveyancer’s point of view and more work means more delays. It has the potential to interfere with the conveyancing process. It’s basically turning conveyancers and solicitors into tax collectors.

TIM MCKIBBIN REINSW CEO

‘Foreign’ until proven otherwise: ‘Subtle’ 2017 budget change affects thousands of sellersThe Real Estate Conversation, 22 May 2017

* From 1 July 2017, anyone who sells a property for $750,000 more will be required to submit a clearance certificate proving they are not a foreign investor.

reinsw.com.au/journalREAD MORE

The reality is a homeowner wants to sell their property for the highest possible price they can achieve. A majority of them are not in a fire sale situation. I’m sure [OpenDoor*] will come here … but a majority of people actually want to work with an experienced agent.

JOHN CUNNINGHAM REINSW President

The US start-ups flipping houses on a mass scale Western Advocate 8 April 2017

* OpenDoor (which operates in four major US cities) allows homeowners to go online, fill in the address of their property. Algorithms crunch some data and make an almost instant offer on the property. If the person accepts, OpenDoor closes the deal within three days.

Technology in the real estate sector is an enabler of better communications and connections between all parties. Technology is not about replacing [agents], it’s about enabling a better experience to take place.


The tech revolution in real estate news.com.au 5 June 2017

Sydney is shifting from an ‘extreme sellers’ market to one where buyers [have] a better shot at securing a home. Buyers no longer have to contend with ‘panicked’ bidding from rival house hunters.


Property hunters wasting thousands on building reports for properties they could never afford The Courier Mail 1 June 2017

I think prices have caught up with buyers. Affordability can’t be [ignored] anymore and some of the crazy results has put some much-needed caution into buyer sentiment.


Boom shows signs of cooling as first-time buyers feel relief Herald Sun 20 May 2017

Landlord insurance protects the landlord through damage or loss of rent as a consequence of a tenant doing the wrong thing under a lease. In my view, it should be mandatory.

TIM MCKIBBIN REINSW CEO

REINSW chief Tim McKibbin makes the case for landlord insurance Daily Liberal 10 May 2017

We will see first homebuyers take a little more ground, but the majority of the market is not in that vein. So you will see the market move to an equilibrium.


Sellers want to raise prices to extract more money from first homebuyers Australian Financial Review 9 June 2017


LAST WORD / MEDIA

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