Our series of principal interviews is about successful principles, independent or franchise, large or small to share their, philosophies, key insights and thoughts about running a successful real estate business and current market conditions and trends; enjoy!
Steve Devine, Devine Real Estate
Since the 1950’s, Devine Real Estate has had it’s roots in Sydney’s Inner West, a market leader, fiercely independent and proud to remain so, here are Steve’s thoughts on the current state of the real estate market.
Q. Chris Mercer (CM): Steve, what is your view of the market today?
A. Steve Devine (SD):
In 27 years I have never seen the market as difficult or tricky as today. In the past there were external factors that could clearly be pointed to for the difficulties of the market, for example the ’87 crash and government policy changes, ’98 Asian bank crisis and the 2008 GFC. The problem at the moment is that without an obvious catalyst for the uncertainty being felt by Vendors and Buyers, it is harder to plan ahead with confidence. The market conditions are unreliable and building momentum is more difficult .
Q. CM: What is the biggest challenge facing your business today?
A. SD: Redefining the business model based on the current conditions of uncertainty. While the nature of the sales agency and property management divisions have not changed the market environment has. Cashflow management is more important than ever. The business owner that takes their eye of their business will suffer. Cash is King in the business today.
Q. CM: What is the biggest opportunity for your business today?
A. SD: With all the trouble, the opportunities for consolidation or acquisition are out in the market. Where you see experience business operators discounting heavily, you know people are hurting and looking for cash flow. Therefore today there are more opportunities to gain efficiencies by merger or acquisition of business than there have been in recent times, especially where the business owner is lacking the confidence to turn the business around, or no longer has the spare capital or cash to do so.
Q. CM: Print advertising vs Internet advertising only. How do you see this issue in real estate sales businesses?
A. SD: Don’t get me started on this? I am a proud professional sales person and I have built up a strong business by successfully marketing property through a range of marketing avenues, and print advertising has been a important part of this. The internet is here to stay and is a great tool, but it is not and will never be the only means of marketing to bring buyers into the frame.
What has happen however, is the vendors have been scared into thinking that the Print Marketing only benefits the Agent and not their interests, the agents who or as I call them, “Saboteurs”, will make a point of conveniently saying to the vendors “look they send out all these Marketing Products to letterboxes and newspaper and 99% of people will throw them away, and any active buyer will go to the internet anyway, which is where I will place your property.” Of course the vendor wants to hear and believe this. What the vendor forgets is that 1% of 30,000 home is 300 interested parties and if 1 of them is coming forward to look to buy your property that wasn’t on the internet, then the marketing has worked properly and as a full service professional agency that rightly, leaves no opportunity to chance, our Agency over many years will get the best buyer in the market to consider your property.
These Saboteurs are quick win, short term thinkers and the internet is their playing field, and it has caused some agents to doubt the benefits of a layered approach to marketing a property. Well I can show from my office stats that the source of enquiries come from our marketing on a much higher percentage than internet only. I feel sorry for the vendors that don’t receive the opportunity to have the most buyers possible submitting offers on their property. The markets rule of supply and demand, is always true, the more demand the higher the price, full stop.
CM: Thanks Steve we really appreciate you sharing your thoughts with us today. And I hope everyone who reads them gains a little insight or clarity for their business.