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Vol 65/05MAY 2014
Winning the accounts race
Get through year end with style
Open dialogue NSW Fair Trading
answers your questions
Conservative credit
The key trends in residential lending
pOrtaldebate
The greatare there roadblocks ahead for the portal providers?
Real Estate Journal May 2014 3
ON THE COVER
15Ask the expertsNSW Fair Trading discusses
electronic signatures and window
safety devices with the Journal.
18COVER STORYThe great portal debatePortals are a signifi cant part
of agencies’ marketing spend,
but what do agents really think
about them?
24Residential lendingThis month we speak to
a fi nancial institution and
an agent about trends in the
residential lending market.
26Tidy upWhat should you know to make
it to the end of the fi nancial year?
INDUSTRY FOCUS
6 In briefThe latest updates from the month.
10InsightJLL NSW Managing Director
and Australian Head of Industrial
Michael Fenton talks leadership.
11The debateIs real estate a career for life?
REGULARS
05 CEO’s message
09 From the
President’s desk
29 Training calendar
30 Last word
MAY 2014
Contents
The Journal speaks to REINSW members and the platform providers to discuss the challenges facing the profession in today’s market. 18
The Real Estate Journal is the offi cial
monthly magazine of the Real Estate
Institute of New South Wales.
30-32 Wentworth Avenue
Sydney NSW 2000
(02) 9264 2343
www.reinsw.com.au
REINSW BoardPresident: Malcolm Gunning
Deputy President: John Cunningham
Vice Presidents:
Brett Hunter and Leanne Pilkington
Directors: Gary Adamson,
Christine Clarke, Peter Cooke,
Miles Felstead, Barry Johnston,
Sarah Lorden, Tony Santolin and
Braden Walters
Immediate Past President:
Christian Payne
REINSW ManagementCEO: Tim McKibbin
General Manager: Peter Griffi n
Marketing & Communications
Manager: Cathie Dickinson
Education & Training Manager:
Michelle Morcombe
Real Estate JournalPublished by
Mahlab Media
369a Darling Street
Balmain NSW 2041
www.mahlabmedia.com.au
Editor: Jill Park
Advertising Executive:
Giuseppe Mangione
Designer: Katherine Gennusa
Managing Editor: Martin Wanless
Head of Client Services:
Roslyn Atkinson
Sales Director: Sara Lewis
Cover and feature photography:
Studio Commercial
REINSW Managing Editor:
Cathie Dickinson
DisclaimerThe 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 refl ect those of REINSW.
The Real Estate Journal is printed on
paper that is derived from resources
which are managed to ensure their
renewability for generations to come.
The Real Estate Journal is a member only publication from
the Real Estate Institute of New South Wales. To fi nd
out more about membership, call (02) 9264 2343, email
[email protected] or visit www.reinsw.com.auAverage monthly
distribution 3,915 copies
REINSW Major Partners
Our Always On Guarantee means that when your customers connect with
one of our market leading electricity and gas suppliers, their services will
be connected on the day they move in. If this does not occur we will
assess their situation, provide a prompt resolution and cover reasonable
out of pocket expenses resulting from the connection delay.*
FIND OUT HOW WE CAN ADD REAL VALUE TO YOUR BUSINESS
Call our dedicated Member Services team on
1300 558 169 or visit agents.directconnect.com.au
*Visit agents.directconnect.com.au/guarantee for terms & conditions
Direct Connect makes moving easy for your customers by
arranging connections to a wide range of services, from
electricity and gas to internet and pay TV and much more.
Our new Always On Guarantee ensures your customers’
connections are our top priority and our industry-leading
GUARANTEED CONNECTIONS FOR YOUR CUSTOMERS
Real Estate Journal May 2014 5
CEO
BEHIND THE SCENES
LAW SOCIETYMalcolm has been particularly busy
this month. He gave the opening
address at the Annual Property
Law CPD seminar held by The Law
Society on the subject of the state of
the property market in NSW.
ON THE ROADThe team is gearing up to set out
on the annual REINSW Roadshow.
In total we will be travelling to 21
locations, starting in Sydney CBD on
13 May and ending in Albury on 25
June. Go online to fi nd details of your
nearest event at reinsw.com.au
JOHN MCGRATHTim McKibbin also met with
John McGrath for an industry
catch up this month. Topics on
the table included: the ‘property
bubble’, foreign investment,
fi rst homebuyers and property
taxation. Watch out for our videos
in The Hub.
TV SPOTDid you spot REINSW President
Malcolm Gunning, Vice
President John Cunningham
and Cunninghams Property’s
Eddy Piddington in 9 News’s
report on Sydney property
trends? The report highlighted
the competitiveness of Sydney’s
northern suburbs. Watch it
online at on-msn.com/PuCLMS
Sharing the load
Tim McKibbin
REINSW CEO
One of the most challenging areas that faces
any sector is how to uphold professional
standards and generate confi dence in the eyes
of consumers.
I am always disappointed to read stories
about fraudulent activities involving real
estate professionals. There is no place in
agency practice for this type of conduct,
and the removal of this minority of individuals
who have breached not only their legal but
their professional obligations is high on
REINSW’s agenda.
Below standardsIt is also disappointing to see an increasing
level of non-compliant conduct attributable
no doubt to inadequate entry-level education
standards.
In an attempt to improve professional
conduct and compliance, we have met with
Minister for Fair Trading Stuart Ayres to
discuss a partial self-regulation model (see
page 9). While this is not a model currently
favoured by government, it is something that
we will continue to pursue in the interest of
the profession and consumers.
REINSW’s proposed model includes
a targeted education program derived
from industry knowledge and experience.
In addition, the model proposes that we
work with government to provide a level of
accountability and professional oversight.
In recent times it has become very clear
that the limited resources of NSW Fair Trading
mean it is only able to become involved in the
conduct of agents after they have breached
their legal and professional obligations. This is
too late and is causing real problems for
the profession and consumer confi dence.
Setting the barA partial self-regulation model is already
successfully operating in a number of other
professions. The Law Society works with
the Legal Services Commission in the best
interests of the legal profession and in
doing so enhances consumer confi dence.
In the health sector, the Pharmacy Guild
of Australia oversees the regulatory affairs
of its members. Drawing on their positive
experiences, it is time for the real estate
profession to take control of professional
conduct within our sector.
I was alarmed to read the article ‘Advisers
snap up real estate licences’ last month in the
Australian Financial Review, which highlighted
how fi nancial advisers are being offered
real estate qualifi cations with “no course,
no examination and 100 per cent success
rate”. While REINSW supports the concept
of Recognition of Prior Learning, this type of
accreditation should not be suffi cient to gain
entry into the profession.
I will continue to update you on these
important areas and value your comments in
regard to the direction REINSW is taking.
Download the May 2014 digital edition now at reinsw.com.au
MAY 2014
Open dialogue NSW Fair Trading answer your questions
Winning the accounts race Get through year end with style
Conservative creditThe key trends in residential lending
PORTALDEBATE
The greatAre there roadblocks ahead for the portal providers?
All the latest from the REINSW newsroomFor up-to-the-minute news on issues that affect you
6 Real Estate Journal May 2014
Taxation placed under the spotlight
REINSW has backed calls for
a review of the entire taxation
system in Australia.
In a speech to the Sydney
Institute, Mr Parkinson
suggested the Government
consider lifting the GST.
Reserve Bank of Australia
Governor Glenn Stevens
later backed Mr Parkinson’s
comments in his own speech
to the American Chamber of
Commerce (Qld) in Brisbane.
REINSW CEO Tim McKibbin
said that REINSW has long been
INDUSTRY FOCUS In brief
TOP TIPS OF THE MONTH
Green your workspace
Sustainability at Work
Director Melissa
Houghton gives her top
three tips on how to be
sustainable in the offi ce.
1. Engage early,
engage oftenIt’s your people who
can make or break your
sustainability strategy.
If you empower your
team to share in the
sustainability journey
and celebrate the
results, they will bring
their ‘A’ game.
2.. Get the basics rightFrom recycling to
switching off power, the
basics are very much
noticed by staff. If you
can’t get the basics
right, how do you expect
people to develop new
ideas and solutions
to the big impact
problems? Remember,
it may be just one sheet
of paper but it all makes
a difference.
3.. Focus on outcomesWhether it’s to improve
your recycling, reduce
your energy and waste,
engage your staff, or
work with your supply
chain, focus on the
outcomes you want to
achieve. Have a plan
to get you there and
measure, monitor and
celebrate milestones.
For recycling information
visit planetark.org
REAL ESTATE’S BIG DAY OUT!
The REINSW Roadshow is back. REINSW is bringing the industry’s key players together for you in
one room. Only at the Roadshow will you fi nd out what’s really happening in your industry from the
people who are in the know.
This year, the Roadshow consists of two not-to-be-missed sessions: the Principals-only session
and the Industry Update.
During the Principals-only session, you’ll hear from the Real Estate Employers’ Federation about
what lies ahead in the industrial relations space. The formation of a new national union raises the
prospect of signifi cant changes to the employment fl exibilities that the real estate industry has
enjoyed over many decades. REEF will outline the impact the proposed changes are likely to have on
your business. If you are a Principal, you can’t afford to miss this session.
REINSW President Malcolm Gunning and CEO Tim McKibbin will then lead the Industry Update
session, which is your chance to get the inside scoop from key industry stakeholders about the
signifi cant issues currently impacting the real estate industry and fi nd out what’s on the horizon.
In addition to an update on some of the issues REINSW is focusing on, attendees will hear
practical advice straight from NSW Fair Trading and have the opportunity to speak directly to a
representative from the NSW Offi ce of State Revenue. Attendees will also hear from the NSW Civil
and Administrative Tribunal and be able to listen to an update from REI Super.
It’s all about your industry, so be sure to book your place today!
Support for a debate on Australia’s taxation system has gathered pace
following outspoken comments by Treasury Secretary Martin Parkinson.
calling for a review of the taxation
system in Australia.
“We’ve been saying for
quite some time that property
taxes are discriminatory and
ineffi cient and affect purchasing
decisions,” he told the Journal.
He pointed to the Independent
Pricing and Regulatory Tribunal
(IPART) Review of State Taxation
issued in October 2008. The
review described purchaser
transfer duty – which at the time
of the review was ranked as
the second biggest contributor
to the State’s own source tax
revenue – as being “among the
least effi cient of the NSW taxes”.
Land tax took fourth place.
“While it may be politically
unpalatable to look at an
increase in the GST as a
substitute for the lost revenue
for the abolition of the state
taxes, we need commonsense
and commerciality to triumph
over politics.
“There are numerous bodies
now calling for this debate,” Mr
McKibbin added.
LOCATIONS
Sydney
North Sydney
Northern Beaches
Parramatta
Penrith
Liverpool
Newcastle
Gosford
Gymea
Wollongong
Batemans Bay
Queanbeyan
Lismore
Coffs Harbour
Port Macquarie
Tamworth
Dubbo
Orange
Griffi th
Wagga Wagga
Albury
TIMES
7.45am to 9.00am
9.30am to 1.30pm
COST
$35 per person (GST inc)
$120 REINSW members; $145 non-members (GST inc)
CPD
12 points (Learning Category 3) (Industry Update only)
To fi nd out more about
the session topics and to
register your place, go to
reinsw.com.au
Real Estate Journal May 2014 7
In brief INDUSTRY FOCUS
REINSW’s request for pool certifi cate deadline extension granted
Pool owners across the state will now have
more time to ensure swimming pools and
spas are compliant prior to the sale or
lease of their property after the Real Estate
Institute of New South Wales voiced its
concerns earlier this year.
The NSW Offi ce of Local Government
announced in late March that the provisions
requiring a property with a swimming pool
to have a certifi cate of compliance before
it is sold or leased will now commence on
29 April 2015.
“Real estate industry representatives
want more time to ensure properties with
a pool are compliant before selling or
leasing,” Ross Woodward, Chief Executive
of the Offi ce of Local Government, said in
a statement.
“Council offi cer feedback indicates that
high inspection failure rates mean that it is
not uncommon for it to take three months
from fi rst inspection to the issuing of a
compliance certifi cate.”
REINSW CEO Tim McKibbin fi rst
addressed the issue in a letter to the
Minister for Local Government Don Page
in February. He asked Mr Page to review
whether there was enough capacity to meet
the impending demand for certifi cates and
to consider extending the deadline.
“Earlier this year we sought a deferral
from the Minister in order to avoid adverse
consequences for the sale and leasing of
properties captured by the legislation,”
Mr McKibbin said.
“With some 300,000 pools and spas
across the state, REINSW suggested
that some transitional procedures be
implemented as part of the commencement
of the obligation.
“REINSW is satisfi ed that the additional
time will allow the smooth implementation
of the new procedures.
“The extension is a successful outcome
for all,” Mr McKibbin said.
Holiday and short-term rental
agents have been reviewing the
Tourism in Local Communities Inquiry report for indications
of the Government’s plans for
regulating the sector.
The Inquiry document outlines
the impact of unregulated
short-term holiday letting on
communities, including issues
caused by anti-social behaviour
of temporary occupants, tension
felt by regulated accommodation
providers towards unregulated
providers and concerns about
reduced numbers of permanent
residents in communities.
The Committee behind the
Inquiry referenced the
two-year industry self-regulation
trial involving a Holiday Rental
Code of Conduct, which has
been supported by the NSW
Government. The outcomes of
that trial are expected this month
and the Committee encouraged
the NSW Government to publish
the results.
Holiday and Short Term
Rentals Chapter Chair Simone
Koen believes the inquiry
foreshadows further proposals
by the NSW Department of
Planning.
“We await the results of the
Government’s trial with interest to
see how they plan to tackle this
issue,” she said.
Government inquiry outlines holiday rental debate
PRIVACY PACK – EXCLUSIVE TO REINSW MEMBERS
Signifi cant reforms to the Privacy Act 1988 (Cth) took effect
on 12 March 2014. The changes affect entities regulated by
the Act and agencies need to update their existing privacy
policies, practices and contractual arrangements to ensure
compliance with the new legislation.
REINSW has put together a Privacy Pack that includes
some key templates to help agents ensure that they are
compliant. These include:
reinsw.com.au/privacy
alarm .org.aureminders
In REINSW’s view, the current level of training does not provide students with the inherent skills required to be a Licensee and conduct their own business.
FROM THE PRESIDENT’S DESK
REINSW has been
advocating that we
partner with NSW
Fair Trading to share
responsibility for
regulating the real
estate profession.
In recent weeks
REINSW CEO Tim
McKibbin and myself
met with the NSW
Minister for Fair
Trading Stuart Ayres
and then the Federal
Minister for Small
Business Bruce Billson
to discuss partial self-regulation.
Both were quick to assert that
they won’t support or legislate
for partial self-regulation. Instead
the focus will be placed on raising
education standards in the industry.
The Government will support
REINSW in this quest to improve
the quality of training.
Road aheadIt seems that prior to our meetings,
the ministers had met to discuss our
proposals, and they both agreed
that lifting the education standard
was the way forward. While we
were disappointed that our
proposal was off the table, we were
left with a very clear understanding
of the next steps. We were also
heartened to have the support of
the Federal and NSW Governments
in lifting education standards for
the profession.
They’ve suggested that REINSW
should be the leaders in education
and we should work with them
along those lines.
Higher standardAs I have said before, agents who
invest time in their education tend to
be more invested in their profession.
REINSW continues to work to make
improvements (see box).
We’ve advised the Government
that we believe the licensing
course should be at diploma level.
Agents will then come away with
a much deeper understanding of
what’s required to be an agent. In
particular, the qualifi cation would
include a focus on areas such
as strategic business planning,
operational plans, leadership and
managing projects to list just a few.
In REINSW’s view, the current
level of training does not provide
students with the inherent skills
required to be a Licensee and
conduct their own business.
REINSW advocates for an
experience component for agents
who want to open their own agency.
While we would prefer to pursue
partial self-regulation, it was
made very clear to us that the
Government will not legislate unless
absolutely necessary. In fact, they
have advised that they are more
likely to cut red tape. So their
proposal is to get behind REINSW
to improve the education standards.
It is a positive outcome. We know
what we need to work towards and
that we have the support of the
Federal and NSW Governments
on our journey.
RAISING THE STAKESREINSW President Malcolm Gunning talks partial self-regulation with
the Government and comes away with a commitment to education.
Partial self-regulation is off the table, but
the Government will support improving
education standards in the profession.
TRAINING DESIGNED TO MEET THE NEEDS OF THE PROFESSION
In the fast-paced world of real estate,
fl exibility in training delivery is paramount.
REINSW’s Real Estate Essentials Series has
been designed with your needs in mind,
offering a more targeted and rich learning
experience to encourage a commitment to
ongoing development
Whether you are are looking to achieve
short term or long term goals in a specifi c
area of practice or want to build to a full Real
Estate Licence, the Real Estate Essentials
Series allows you to do so in a manageable
and affordable way.
Comprised of eight short courses, the
Real Estate Essentials Series allows you
to undertake training in specifi c areas of
practice. You can pick and choose what you
want to learn about and when you want to
learn it.
Certifi cate of Registration Course – Getting
Started Essentials (5 days)
List and Market Property Essentials (3 days)
Property Management Essentials (5 days)
Property Sales Essentials (4 days)
People Management Essentials (3 days)
Trust Accounting Essentials (3 days)
Keeping the Books Essentials (3 days)
You and the Law Essentials (3 days)
To fi nd out more about the Real Estate
Essential Series, go to
reinsw.com.au/essentials
Real Estate Journal May 2014 9
The property industry is relatively small. A client today can be a colleague tomorrow, a competitor can become a client and a colleague can become a competitor.
10 Real Estate Journal May 2014
NSW Managing Director and Australian Head of Industrial at JLL, Michael Fenton, attributes his career to chance.
In the stars
My career in real estate has evolved from a series of chance
meetings and events, which is a constant reminder to me that
I am in a people business fi rst and property second.
Growing up, I didn’t have any connection to the property
industry, but started to develop an interest in the late eighties while
in high school when I had to read the Australian Financial Review
as part of my economics subject.
I attended the University of Technology, Sydney (UTS) where
I completed a Bachelor of Applied Science in Land Economics
and followed this with a Masters in Commerce, majoring in Land
Economics at UTS. While studying I made a number of friends
whom I am still in contact with today and who hold positions of
infl uence in the property sector.
My fi rst job started as a work experience role at Raine & Horne
Commercial (now Savills) during my fi rst degree. It literally started
as a two-week casual role and I ended up staying there for eight
years. I focused on industrial property (again by chance).
After eight years I felt it was time to change my career path
and I accepted a role with Deutsche Asset Management (now
Dexus), working on the sale and leasing of industrial assets for
their listed and wholesale property trusts. I will always remember
accepting the role and vowing never to return to the agency world
(I would later learn never to say never again).
I developed a broad set of skills working at Dexus with exposure
to experts in development, fi nance, tax, legal etc. After four years
on the owners’ side, I returned to agency and have now been in the
second phase of my agency career for nine years.
Along the way I have had the pleasure of working with, and for,
some of the industry’s most infl uential and respected leaders.
I have found that exceptional leadership is fundamental to the
success of a business. Good leadership is about having an overall
vision and communicating it effectively. It is about being able to
identify and foster the strengths and talents within your team in
order to achieve that vision.
My key advice for agents looking to grow their careers within
the property industry is outlined to the right.
INDUSTRY FOCUS Insight
LEARNING ALONG THE WAY
The client always comes fi rst
During my fi rst year in agency I once referred to a tenant as
a client. My manager quickly reminded me the tenant wasn’t
paying the fee and therefore wasn’t my client. Remember who
your client is. Always work in the client’s best interest and
demonstrate to them that you are adding value to their business.
Your reputation will shape your career
Treat everyone in the industry with respect, regardless of who
they are. The property industry is relatively small. A client today
can be a colleague tomorrow, a competitor can become a client
and a colleague can become a competitor. With the average Gen
Y property professional changing jobs every fi ve years, you can
build a lot of strong and enduring relationships throughout your
career with the right approach and attitude towards your fellow
property professionals.
Recognise the work of others
I often hear people refer to a deal they did, claiming sole and
total responsibility. No one person can sell or lease or value or
manage a property on their own. It is always a team effort. And
when you lead a team, you must always publicly recognise the
contribution and effort of your team members.
The debate INDUSTRY FOCUS
Real Estate Journal May 2014 11
NEXT MONTH WE ASK: ARE AUCTIONS THE BEST METHOD OF SALE?
I feel real estate is more of a vocation than
a career. If approached with ethics and
passion, it can be a wonderful opportunity
to help many and diverse people at one of
the major crossroads in their lives.
Helping people to achieve their goals
around selling and buying property is both
a way to positively affect their lives and
make a good income.
It can be a stressful career, and if your
focus is purely on making money then
you are unlikely to make real estate a
career for life.
Benefits of ageUnlike many other careers, strength of mind
and strength of spirit are more important
than your physical condition. By this I mean
that growing older is no particular handicap
in the job as wisdom and gravitas can be an
additional benefi t.
If you stay in and around one locality and
ply your trade with skill and ethics, I have
found that eventually business comes to you
with lower levels of effort, which also builds
longevity in your career.
Constant demandsIn our modern world, one of the principal
challenges of a real estate career can be the
work/life balance.
This is the age of constant communication
and clients can become very frustrated with
any delay in your response to their needs.
This places increasing demands on your
time and life. Finding a balance is the key for
many agents.
Not for everyoneWith all these opportunities and challenges
real estate will not be the ideal lifetime
career for everyone, but it does provide
many different avenues to build a rewarding
and interesting lifetime career.
After 24 years and more than 1100 sales in
both the dynamic inner city environment
of Perth and now the diverse and beautiful
tree-change destination of Kangaroo
Valley, I can truly support real estate as
a career for life.
GRAEME SMITHPrincipal/Owner
at Harcourts
Kangaroo
Valley
There is no doubt that real estate is a
rewarding career that offers a range of
lifestyle and fi nancial benefi ts that could
tempt an agent to stay ‘in the game’
for life. As a former selling principal of a
high-performing offi ce in Brisbane, I’m
familiar with how engaging and lucrative the
industry can be if you are willing to roll
up your sleeves and dedicate yourself to
your craft. However, is it a career for life?
Not necessarily.
Step on the ladderRoles in real estate do not have to be the
be-all and end-all of your career. I would
argue that being part of the real estate
industry can serve as a vehicle for rapid
wealth creation and career redirection.
With the right mindset, tools and work
ethic, a new agent can lean on the brand
of a strong organisation, take advantage of
up-to-date training opportunities and work
exceptionally hard in the early phase of their
career to build up enough capital to create
options for their future.
Each day, employees in the real estate
industry utilise and strengthen their
expertise in areas such as communications,
public relations, effective negotiation, brand
marketing, digital marketing, reputation
management, people management, public
speaking, leadership and business coaching.
In time, repetition and experience leads to
the development of a formidable personal
arsenal that can readily be transferred to
many different careers in other industries.
Famous facesImagine if business icons and Queensland
success stories such as Clive Palmer, Don
O’Rorke and John Fitzgerald had remained
in their real estate careers for life? These
men have generated enormous wealth
and imposing reputations from taking the
skills honed in real estate and applying
that business acumen to mining and
property development. I’m sure they
would have made formidable sales agents,
but real estate was simply a springboard
for triumph.
NICK MCGUIREBusiness
Development
and Consultancy
Manager at
PRDnationwide
YES NO
Is real estate a career for life?The Journal asks REINSW members which side they fall on.
Entries are now open for the2014 REINSW Awards for Excellence
Category sponsors
It’s that time of year when REINSW showcases our industry’s top performers.
This is your opportunity to highlight your biggest successes and most outstanding achievements.
Finalists will be announced in August 2014 and winners will be revealed at the Gala Dinner on Thursday, 2 October 2014.
To enterVisit www.reinsw.com.au/2014Awards to view the criteria and to enter.
Entries close on Thursday, 12 June 2014.
More informationEmail [email protected]
Individual categoriesAuctioneerBuyers’ AgentCommercial Property ManagerCommercial SalespersonCorporate SupportJohn Greig OAM Community ServiceProperty MarketerResidential Property ManagerResidential SalespersonRising StarRural MarketerYoung Agent
Agency categoriesCommercial Agency – LargeCommercial Agency – SmallDigital MarketingHoliday & Short-Term Rentals AgencyInnovationReal Estate Agency – LargeReal Estate Agency – SmallResidential Property Management TeamResidential Sales Team
The Awards for Excellence has had a facelift! We’ve listened to your feedback and made the changes you’ve asked for.
Entering is easyIf you have time to answer 5 short questions, then you have time to enter.
The new criteria means it is easier and less time consuming to prepare your submission.
More agents can now enterAs long as you work for a member agency, then you’re eligible to enter.
With entries now open to more agents than ever before, winning really means you are the best of the best.
New categoriesA number of new categories have been added to the program, recognising the changing face of real estate.
Feedback from industry expertsEach category is judged by a panel of qualified industry experts and you’ll have the opportunity to find out what they thought of your submission.
Draw attention to yourselfWinning an award is a major achievement and a good news story – and we’ll help you shout it from the rooftops!
So, don’t be shy. Your achievements deserve the opportunity to be recognised.
Enter the Awards for Excellence today!
Why enter?
More time to get pools safe before selling or leasingPool compliance certifi cate extended to 2015The NSW Offi ce of Local Government (OLG) delayed the introduction of the requirement for swimming pool
and spa pool owners to get a valid Certifi cate of Compliance or relevant occupation certifi cate to on or after
29 April, 2015. This means pool owners or their appointed agents will have more time to ensure swimming
pool barrier compliance prior to sale or lease of their property.
Where experience countsPrior to contacting your local council for a compliance inspection, contact your local Poolwerx technician to
carry out barrier assessment reports and to understand what work is required to meet compliance.
With over 20 years’ experience, pool and spa care experts, Poolwerx, have identifi ed fi ve common areas of
issues with barrier compliance including;
• Gates not self-closing; hinges; latches; unhindered access via gates, doors and windows
• Latch heights lower than 1.5m
• Barrier heights lower than 1.2m
• Footholds within the non-climbable zone such as BBQ; pot plants; trees; hedges; rails
• Gaps larger than 100mm under fence and between fence verticals
For additional resources call 1800 009 000 or email [email protected]
Additional information you should know
Fence the pool and shut the gateTo protect property managers and principals in the event of an incident it is suggested for
inclusion in the Residential Tenancy Agreements as an additional term that the tenant is never to prop open a pool gate or leave the access door open, and must ensure that the gate or door is self-closing at all times. Also, the tenant is not to place any objects inside or outside the pool fence which would allow a child to get a foothold to climb the fence. Such objects include pot plants, rocks, shrubs, BBQ, benches, trees and deckchairs.
Pool RegisterTo check if a property with a pool has been registered and holds a current valid compliance certifi cate, check the NSW Swimming Pool Register. The register is ideal to search by address for properties for sale or lease with a swimming pool or spa pool. Where that property is a unit with a pool or spa on common property, it is the responsibility of the owners’ corporation to register the pool and obtain a Certifi cate of Compliance. Remember compliance certifi cates
are only valid for three years from the date of issue.
Establishing more certifi ersThe Building Professionals Board is establishing a new category of private certifi er dealing with pool and spa inspections. Poolwerx will keep you informed if our technicians become successful as private certifi ers. This will compliment council inspections and increase the
number of people who can conduct swimming pool inspections.
Pool safety awareness Use this additional time to increase pool safety awareness for your business and stakeholders. Poolwerx have partnered with Laurie Lawrence and the ‘Kids Alive Do The Five’ program, which is aimed at increasing water safety awareness for parents and children aged under fi ve. There are a number of resources available to Property Managers and Sale Agents to educate new tenants who have moved into a property with a pool and some tips for new pool owners.
What are the penalties?Failure to register a swimming pool will result in the owner of the pool or the owner’s corporation (as the case may be) incurring a penalty of up to $2,200. Non-compliance with other requirements of the Swimming Pools Act 1992 may attract a penalty of up to $5,500. On the spot fi nes of up to $550 can also apply.
Source: NSW Government Offi ce of Local Government, 28 March 2014
NSW Government Swimming Pool Register User Guide, April 2014
ADVERTORIAL
Ask the experts INDUSTRY FOCUS
Real Estate Journal May 2014 15
REINSW RESOURCESREINSW members benefi t from
a series of resources that help
them in their business and give
them a voice in the industry.
Here’s just a selection.
Contact the REINSW Helpline
for unlimited professional
guidance and advice when
you need it on (02) 9264 2343
(option 4) or email
Like our Real Estate Training
Facebook page and keep up
with all the latest training news:
facebook.com/REINSWTraining
Find out about all the lobbying
work REINSW has been
conducting on your behalf and
have your say on the big
issues affecting the industry
at reinsw.com.au/lobbying
WE WANT TO HEAR FROM YOU
Who would you like REINSW to put
your questions to? Send us your
suggestions and questions to
HELPLINE
TRAINING
LOBBYING
Your questions answeredThe Journal puts your questions to key industry experts. This month we talk to NSW Fair Trading Commissioner Rod Stowe and REINSW CEO Tim McKibbin.
Q. Why are agents not yet able to obtain electronic signatures?
Tim McKibbin: When the Property, Stock and Business Agents Act 2002 and the
Property, Stock and Business Agents Regulation 2003 went through Parliament, an
electronic environment for executing contracts was not contemplated. The world has
moved on. The Act and the Regulations are currently up for review. We need to be
mindful that technology is providing agents and consumers with the opportunity to
enter into these transactions electronically. We therefore need to prescribe, within the
governing legislation and regulations, the process that will give certainty of contract
utilising this latest technology.
Rod Stowe: NSW Fair Trading is preparing a discussion paper on real estate
industry reforms that is expected to be released in the second half of 2014. The issue
of electronic signatures will be included in the paper seeking public comment. We
are aware the South Australian Government has announced a proposal to change
the rules that prohibit land transactions from being conducted electronically in a bid
to slash costs and paperwork. We will be keeping a close eye on what transpires in
South Australia, where the government is also working with the industry to identify
other processes that can be made electronically, while ensuring the security of
the transactions.
Q. Is there too much responsibility placed on agents in terms of the new laws regarding window safety devices?
Tim McKibbin: Property managers are not suitably qualifi ed to make an assessment
of whether or not the device is functional and generally compliant with the
regulations. If their assessment is incorrect, it may lead to the fatality of the very
people the regulations are designed to protect. That puts the property manager in
a very unenviable position. In today’s society we expect that suitably qualifi ed and
experienced people would be making the judgement of matters pertaining to our
health and safety.
Rod Stowe: The responsibility for installing window safety devices in residential
strata scheme properties and ensuring the devices are compliant lies with the
Owners Corporation, not individual landlords. In relation to the completion of a
condition report, agents should assess the condition of child window safety devices
and determine whether they appear to operate appropriately. The agent is required
to undertake a similar assessment of the device as would be currently undertaken
in respect to other items listed on the report; for example, door locks, hot water
systems, air conditioners and smoke detectors.
Great offers available for REINSW Members.
To find out how we can help your agencygrow, give us a call on 1300 695 645 oremail [email protected].
MORE AND MORE AGENTS AND INVESTORS ARE CHOOSING COMMERCIALVIEW.COM.AU
NOW IS THE TIME TO MAKE THE SWITCH.
INCREASE YOUR REACH AND GENERATE MORE LEADS WITHREALESTATEVIEW.COM.AU
Great offers available for REINSW Members.
To fi nd out how we can help your agency grow, give us a call on 1300 695 645 or [email protected].
REA GROUP
DOMAIN
REA incr eased revenue by
30% to $209.4M for the six months ending 31 December 2013
67% growth of listing ‘depth products’ in the fi rst half of the 2013/14 fi nancial year
61% News Limited’s stake in Realestate.com.au
75% of agents nationally use Domain
21%Grow th of agents with listings in the last fi nancial year
OWNED
by Fair fax
MORE THAN
$45m invested in technology each year
Available in over
200 publications
as well as ONLINE
18 Real Estate Journal May 2014
FEATURE
peak to any agent about the issues
that are concerning them and portals
are usually on the list. Marketing
spends are increasingly dedicated to
making sure listings appear on page
one of the search results.
Portals proved to be a hot topic at REINSW’s
fi rst Industry Summit, held in November last year.
Attendees were quick to point out the challenges
of keeping up with the ever-widening span of
services available to them, and the fact customer
data is held by a third-party player as opposed to
being kept within the profession.
“The major portals keep coming up with
new ways to entice agents to feature their
properties in a grander way, but it is often
hard to quantify the quality of the increased
exposure,” Cunninghams Property Principal
John Cunningham said.
In Mr Cunningham’s experience, premium
listings do not necessarily equate to more
physical viewings of property listings. “The hits
and reporting do not really tell the story, so I feel
there needs to be a far greater in-depth reporting
on these to get the real story.
“Marketing for marketing sake is often the
outcome from this pressure cooker environment
whereas appropriate enhancements for the right
properties is the outcome most professionals are
after,” he said.
“We live in a world driven by market forces, so
there really is little that can be done other than a
third serious player entering the fi eld to break the
duopoly that currently exists.”
He called for greater dialogue between the
portals and the profession to ensure the former
understand the pressures faced by agents.
“The mood is very negative towards portals
as the majority of agents feel like they are a
constant target to be fl eeced at will and that is
not healthy for co-operative relationships,” Mr
Cunningham said.
mcconnell bourn Director Matthew Bourn
believes that portals have too much power.
“It is clear that the leading portals have
wielded too much power for too long and that
as agents we are disadvantaged, often having
to absorb the ever increasing portal costs,”
he told the Journal.
He conceded that he generally does not feel
pressure to get listing upgrades, but when a
suburb is heavily loaded with properties, there is
pressure to upgrade to get a property noticed.
In contrast, PRDnationwide Newcastle and
Lake Macquarie Managing Director Mark
Kentwell argues that while coming to grips with
portal upgrades can be frustrating for some, it is
essential for agents to embrace them.
“It’s one of those things that you can either
resist and possibly be left behind, or embrace
and become an expert and fi nd out the upgrades
that are of the greatest benefi t to your clients and
you and your agency,” he said.
“Portals will have as much power as the agents
give them. The reason they are becoming more
powerful is because they are getting better
and better at what they do. It’s been quite a
lazy approach by brands who are not really
offering anything that comes close to the portal
experience on their own website.”
REINSW President Malcolm Gunning believes
agents should understand the marketing
landscape and be able to guide their vendors
in putting together a tailored marketing plan.
Understanding portals and their product offering
is an integral component of this.
In the second of our two-part series about marketing, we discuss the power of the portals and print, and the impact they have.
S
PORTALDEBATE
The gr eat
Real Estate Journal May 2014 19
“Portals and press real estate advertising should be seen
as a cost of business,” Mr Gunning said. “Smart agents will
pass on the cost.
“Agents’ egos shouldn’t get in the way of effective marketing
decisions,” he added, referring to agents who choose to use print
for branding as opposed to part of a vendor advertising campaign.
“You shouldn’t use advertising for the sake of advertising.”
Premium servicesThe portals must be doing something right. REA Group reported
a 30 per cent increase in revenue to $209.4m for the six months
ending 31 December 2013. Former REA Group Managing Director
and CEO Greg Ellis attributed the success at the time to taking
a long-term view of the business and shifting the focus from
“subscriptions to depth products”.
‘Listing depth products’, which allow agents to highlight
and enhance a particular listing, grew by 67 per cent in the first
half of the year for REA. It is clear that the emphasis is squarely
on keeping your listing on the first page of search to ensure your
property gets seen by potential buyers.
REA Group’s Head of Sales, Residential, Steve Carroll
believes pricing is aligned with value. “The value of online
advertising continues to grow and so pricing is aligned
accordingly,” he said.
This is not necessarily comforting news for principals out
there who are already dedicating a hefty amount of their
marketing spend to portals. However, Mr Carroll justifies his
comments by adding that REA invests heavily in its product to
ensure its relevance in the market.
“Each year, we invest more than $45m in our technology
platform and product innovation to ensure we remain at the
forefront of consumer’s digital needs.
“In either a free or paid model, consumers need to deliver
on the consumer experience. Delivering a world-class consumer
experience takes significant investment. If a portal can
deliver a great consumer experience, it will have a place in
the market,” he said.
New domainDomain’s Chief Operating Officer Tony Blamey spoke to the
Journal about the portal’s position in the market.
“Being a part of the Fairfax Network gives Domain great reach
and visibility throughout Australia,” he said.
“Domain is strong in the Sydney and Melbourne markets, with
close to 100 per cent of agents as subscribers. Nationally, more
than 75 per cent of agents now use Domain and we have plans in
place for further expansion in key targeted markets. We are seeing
positive responses from agents around the additional competition
this will generate in the industry.”
Domain has a zoned rate card structure based on geographic
zone that has been designed to reflect the attributes of the
local market.
“We understand that marketing costs may not be recovered
from vendors and that’s one of the reasons we offer flexibility in
our rate structure,” Mr Blamey said.
Industry firstThe fear for agents is that the portals will cut them out of
the equation and go directly to the vendor. General Manager
Petra Sprekos says that where realestateVIEW.com.au differs
from other portals is that it believes the role of the agent is critical
to the property transaction.
“All of the portals are quite similar, but we do have a monthly
based subscription, plus upgrades and display advertising,” Ms
Sprekos said. “What we try to do is offer more for that monthly
subscription so it’s not just advertising, but it includes the data as
well. Then there is the option to upgrade so you’ve got featured
listings, showcased listings, premier properties and so on.
So it is very similar to what REA and Domain offer; however, we
believe how we present the listings is fairer and showcases the
agents and their branding.”
The company strengthened its commercial offering
commercialVIEW.com.au in March when REA closed
Realbusinesses.com.au.
“Our leads and traffic have doubled in a matter of a few weeks,”
Ms Sprekos told the Journal.
Giving it awayWhile the number of players in the commercial sector is reducing,
the number of portals in the residential sector is increasing. The
latest ‘new kid on the block’ is the free-listing website Homely.
The site was born out of StreetAdvisor.com.au, which attracted
more than 10 million people over the course of seven years to
learn about streets, suburbs and neighbourhoods. It claims to
be different from the other portals in that it does not have banner
ads and it places a premium on design. Homely’s connection to
StreetAdvisor.com.au is also well utilised.
“Agents had been telling us they felt portal listing fees were out
of control, that they felt pressured into listing upgrades and we
strongly believed the free to list option is a better way,” Homely
Co-Founder and Co-CEO Jason Spencer told the Journal.
“Instead we believe any paid options should be based around
agent marketing platforms, tools and services that help an agent
generate new listings, that build their brand and have a clear ROI.”
Mr Spencer is quick to dispute that Homely is another fly-by-
night portal. “To succeed in any endeavour you need 24/7 focus. I
don’t believe it’s something you can do part time or outsource. It’s
a tough long game.”
So far Homely has the backing of major networks such as
Raine & Horne and Richardson & Wrench.
Tracking campaignsPortals are obviously a central part of the marketing spend, but
where does print fit into the mix? RP Data’s new Media Maximiser
Report addresses this conundrum. Over the course of the past
two years the company has developed and tested a new method
of tracking ad success. (continues page 23)
Delivering a world-class consumer experience takes significant investment. If a portal can deliver a great consumer experience, it will have a place in the market.
20 Real Estate Journal May 2014
FEATURE
Google explored the incorporation of free real estate listings in
Google Maps back in 2009 before unceremoniously dumping the
concept. The company declined to comment on whether it would
reappear in a different format in the future and instead pointed to
three of its most interesting features from a real estate perspective.
Dynamic remarketingReal estate agents can encourage a visitor to return to their site by
investing in dynamic remarketing ads through the Google Merchant
Center. These ads are tailored to the specifi c consumer and are
designed to show them the actual listing they viewed on your
website via an online ad served to them.
Maps APIGoogle Maps API can be embedded into a company website
to show clients the geographical location of their listings.
Buyers can use Maps as they undertake a Saturday property
search, updating with both property information and real-time
traffi c information.
Mobile Click to CallSince many prospective buyers are out and about when looking
for property, Mobile Click to Call allows a user to call directly into a
real estate business right from the ad.
The real estate industry is keenly watching Google to
see if it will launch new services on its Google Maps
platform to rival the power of the listing portals. The
subject was a major topic of discussion between the
experts featured in our April cover feature (page 18).
Goo gle
Real Estate Journal May 2014 21
According to PRDnationwide Newcastle Managing Director
Mark Kentwell, print can be a successful component of a
marketing campaign for properties at both ends of the
pricing spectrum.
“I’ve got a specifi c example of a property we sold for just
over $3m recently at a friendly auction,” he told the Journal.
“The buyers who actually bought it under the hammer in the
auction saw it in the full page ad we had in the paper the day
before the auction.”
The ad was the last of fi ve consecutive full-page newspaper
ads the agency had run for the property. “That owner had
invested maybe $10,000 in print media and that resulted in a
sale $200,000 above where the next buyer was,” he said.
At the top end of the market, there might only be a handful
of buyers with the appropriate funds who are actively looking
for a property at any one time.
“There might only be 50–100 people living in the greater region
with the capacity to spend that sort of money. They just aren’t
actively looking because they are comfortable where they are,”
he said. Therefore, the property needs to grab them in order for
them to go through the upheaval of moving.
“If [the ad] is in an inner Sydney paper like the Wentworth
Courier or somewhere up in Brisbane where they do a lot of
full pages, in those publications you may need to do a double
page to stand out,” Mr Kentwell said.
mcconnell bourn has been a keen advocate of marketing
properties within print media for many years, often featuring
prominently within the North Shore Times on a weekly basis.
“We believe when marketing properties the combination of
print and online media is more effective in achieving maximum
market exposure, than online alone,” mcconnell bourn Director
Matthew Bourn said. In his opinion online reaches buyers who
are actively searching for property, while print reaches the
passive buyer.
“This is evident in properties we have sold to buyers who were
not in the market (i.e. not searching the internet or attending
any other open houses); however, after seeing a print media
advertisement [they] attended an open home and ended up
purchasing the property,” he said.
The company’s confi dence in print is evident from its launch
of their own magazine address, a property magazine distributed
to more than 38,000 letterboxes throughout Ku-ring-gai
approximately every two to three weeks.
“We believe our investment within this form of print media
further enhances our reach within the market and ensures
maximum exposure for our properties.”
A place for print
22 Real Estate Journal May 2014
FEATURE
“We track every real estate advert on the market, not just the
fact that a property is listed, but every advert that is listed, how
it is listed, whether it is online or in the paper, whether they use
a colour advert, whether they don’t and whether it’s just in the
classifi ed section,” explains RP Data General Manager Data
Products, Greg Dickason. “Because we track all of that, it’s
quite easy for us to correlate the advertising campaign to what
actually happened.”
Insights include how quickly the property sold, did the agent
have to discount and by how much. This information is correlated
to the amount and type of advertising that was conducted for the
campaign to give an indication of what works best in certain areas.
“For me the biggest headline is that print is defi nitely not dead,”
Mr Dickason said. He gives the example of the North Western
statistical division, which includes Dubbo, Central Macquarie.
Data shows that agents who used print and online sold 10 per
cent more properties than those who just used online ads.
“The other big headline fi gure was they actually sell faster.
On average they are selling fi ve days faster,” Mr Dickason said.
He attributes the success of combined print and online
campaigns in part to the fact that when vendors invest in
marketing their property, it makes them a more committed seller.
Print is not deadWhile classifi ed ads have been migrating online, News
Limited still sees a strong place for print ads.
“We’ve been doing a lot of research and we’ve found that
the print advertisements that are most effective are the bigger
advertisements that are more pictorial,” News Limited General
Manager Sales – Real Estate Tom Panos told the Journal.
News Limited is heavily invested in the real estate sector.
The media giant has a 61 per cent stake in the Real Estate
Group, which owns realestate.com.au. It is still strongly invested
in print through its Leader Group of community newspapers
and property sections, such as the Realestate section recently
launched in The Saturday Daily Telegraph.
The company’s strategy of encouraging bigger ads may
be seen as unsurprising, considering the cost is always going
to be greater for a full-page ad than a classifi ed. However,
News Limited fi rst had success with the approach of using large-
format, image-based ads in the company’s regional newspapers
and is now looking to roll out the approach across its portfolio.
“In real estate, what we’re doing when we do a really nice,
full-page ad in the Wentworth Courier is we’re turning a glass
of water into a bottle of Pellegrino,” Mr Panos said. “We are
improving the perceived value. We need to touch their
emotional senses, not their logical, rational senses.”
Fairfax, meanwhile, has been in the property advertising
business for almost 180 years. The company’s print arm
refrained from commenting for the article. However, it should
be noted that Fairfax made a signifi cant investment in the
property media when it entered into an agreement in 2011 to
merge its community newspapers in Victoria with Metro Media
Publishing (MMP).
MMP was established in 2009 by Antony Catalano, former
Director of Real Estate at The Age, General Manager of MPG
and a member of the The Age’s senior management team.
MMP titles include The Weekly Review, which is delivered
free each week to more than 630,000 homes across Melbourne
and Geelong.
More than 20 of Melbourne’s leading prestige real estate agencies
have partnered with The Weekly Review. The reach of the magazine
is extended through the qualifi ed leads of estate agent databases.
It is yet to be seen if the company will roll out its model in the
NSW market.
State of playSo what does the long game look like for the papers and
portals? It is clear that there is a growing distinction between
the purpose served by print and digital. Whereas print appeals
to the emotions, digital serves consumers’ growing desire for
information prior to sale.
The success of real-estate backed lifestyle magazines in
Victoria proves that print can be an important medium for the
profession. Meanwhile, the newspapers have recognised print’s
ability to appeal to the heart with their backing of beautiful
imagery-based ads over the information provided by classifi eds.
Those in search of more information will seek out the
portals where fl oor plans, pictures and property specs can
be combed through at leisure to sate even the most particular
buyer’s thirst for information. Therefore, the pressure will
continue to be on principals to stay on page one of the search
listings. As REA’s results show, ‘listing depth products’ are
where the money is.
However, more is also being demanded of the portals
themselves as each strive to provide data and expert advice
for their customers.
SurprisesNew players will continue to enter the market. The one people are
watching out for is Google (see page 21). The advent of wearable
technology like Google Glass (yet to be released in Australia) could
make their proposition even more interesting.
Meanwhile, debate around portals often comes back to the
question of whether there should be an industry portal, something
Mr Cunningham believes would be challenging without a strong
central national body leading the way. Instead he looks to a new
player to change matters.
“The problem is that REA and Domain are entrenched in the
consumers’ and the agents’ minds, and it’s simply too easy
not to change,” Mr Cunningham said. “That is why I believe the
alternative has to be so surprising that everyone stops and takes
notice. Until that happens nothing will really change as we all just
want to get on with business.”
Real Estate Journal May 2014 23
AUDITED MEDIA REACHWhen researching where to place advertisements,
how do you know that the audience numbers quoted to
you are correct? The Audited Media Association of Australia
(AMAA) was established by advertisers as the body
responsible for auditing media. It has been reporting
the circulation fi gures for print publications since the
1930s and has grown to also include website audits.
Go online and use its Quick Find tool to check the audited
circulation and distribution fi gures for newspapers,
magazines and websites at: auditedmedia.org.au
24 Real Estate Journal May 2014
Residential lendingIn the second of our two-part series, the Journal explores the state of play in the residential lending market.
FINANCIAL
INSTITUTION
ROD CORNISH
Division Director at
Macquarie Capital
(Real Estate)
Q. What is the current state
of the residential lending
market in NSW?
A. It’s a healthy market for
new fi nance commitments.
Demand is strong from owner-
occupiers (most particularly
from upgraders) and investors
looking for housing fi nance.
An increasing number of those
investors are actually people
who would typically have been
fi rst-time buyers. Instead of
buying a fi rst property to live
in, they are renting it out for
investment purposes.
Q. How is the fi nancial
environment affecting
lending?
A. We’re at a many decade low
in terms of mortgage rates.
The unemployment rate is
rising, but from a historical
perspective the rate is still
reasonable in NSW and below
the national average.
Existing mortgage holders
certainly paid down debt
as interest rates were cut.
More recently, the banks are
experiencing an increase in new
business, with new borrowers
confi dent to take out loans.
At the same time, though,
conditions are becoming more
competitive with banks reducing
fi xed rates to access more of the
market as house values rise and
lending risks decline.
Q. How does this compare
to previous trends?
A. If you look at the total annual
rate of growth of housing fi nance
outstanding, including existing
loan balances, it’s actually a lot
more subdued than what we’ve
seen in previous upswings as
borrowers have been paying
down principal amounts.
Q. Is this is a good thing for
the property market?
A. Broadly, people are probably
a bit more conservative than
they have been in previous
upswings, so when things do
eventually slow down it won’t
be such a marked downswing
because existing borrowers have
typically reduced gearing levels.
I think that’s probably positive
for the market and should result
in more stability when rates
eventually rise.
RESIDENTIAL
AGENCY
JENNIFER WITTMANN
National Network
Development Manager at
First National Real Estate
Q. What is the current state
of the residential lending
market in NSW?
A. Our preferred mortgage
supplier, AFG, arranged $21.7
billion in home loans in the
second half of 2013, compared
to $18.3bn in the fi rst half of
2013. NSW showed the largest
increase. They were 33 per
cent higher in the second half
of the year, so there’s defi nitely
increased confi dence following
the change of government.
The average loan fell to 67.3
per cent LVR, which means
that people are borrowing less.
They’ve got more equity. This
is the lowest level of LVR since
June 2012.
Q. How does this compare to
previous trends?
A. Back in 2000–2001 prices
were lower, but the rental
returns were good and people
had equity in their homes.
All of a sudden, people were
paying for lifestyle items on
their mortgages because
there were revolving lines of
credit. It was a generation of
‘everything now’.
What are people doing now?
There has been a big reality
check and people have been
going without, paying down
their credit cards and personal
loans, increasing savings,
and getting on top of their
mortgage. Not all, but most
people. I think the market has
self-corrected.
Q. Why are people now
taking a more conservative
approach to lending?
A. I think it was forced upon
lenders because the post-GFC
environment required greater
accountability as well as more
stringent policy and there
was waning confi dence in
the government.
The banks also tightened up
their lending criteria and there
was less competition from
non-bank lenders.
INDUSTRY FOCUS Analysis
KEY RESOURCESFor the latest in housing
fi nance trends from the
Australian Bureau of
Statistics visit abs.gov.au
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26 Real Estate Journal May 2014
IN BUSINESS
Tidy upIn the fi nal months before the end of the fi nancial year, the Journal outlines the key steps to getting your house in order.
It’s nearly the end of the fi nancial year and our minds turn to tax
returns and fi nal accounts. Take the pain out of the process by
spreading the work across the course of the fi nancial year.
The Journal spoke to Mike Hawkins, Executive Offi cer of BEC
Australia – the not-for-profi t organisation that helps small business
owners through its network of Business Enterprise Centres – for
advice on how to prepare for the end of the fi nancial year.
Cost checkings“Businesses can fall into the trap of overestimating income
to be received and underestimating the costs of running the
business,” Mr Hawkins said. “This can have an adverse effect
on cashfl ow and can threaten the viability of the business.” He
points to marketing as one example of a business cost that agency
owners tend to exceed original estimates.
“Follow up on outstanding invoices so that you can get
payments into your business as soon as possible,” he added. In
particular, agencies must ensure that trust account balances and
all transactions are authorised and recorded. In addition, all PAYG,
superannuation payments and WorkCover premiums must be up
to date.
“Review end of year income and expenditure and compare with
the estimates made at the beginning of the year,” Mr Hawkins said.
“Are changes required for the coming year’s budget? Do you need
more or less staff? What are the market conditions?”
On the groundWilson Property Agents Principal and Director Adrian Wilson
works closely with his accountant, who has a ‘hot desk’ at his
Sydney offi ces and forms part of the team.
“Our EOFY procedure is very straightforward. We close off the
trust accounts fi rst and ensure that all professional fees and client
funds are disbursed prior to 5pm on the 30th. The accounts are
then reconciled the following week for the year and we are usually
done by the end of July, beginning of August.”
The company doesn’t have a fi nancial planner, but works closely
with their private bankers.
“We used to bank with one of the big four but were simply
treated like a number and ignored,” Mr Wilson said. “Since we
made the change around three years ago, we have formed a
healthy partnership with our private bankers who have taken
the time to understand our business. This makes a signifi cant
difference to our ability to manage our fi nances and seize
opportunities,” he added.
Planning your financesThe concept of fi nancial planning is still relatively new in Australia.
Director and Principal Financial Adviser at Unifi ed Financial
Services Michelle Tate-Lovery describes fi nancial planners as
“the architects of someone’s life plan”.
Questions such as ‘what does the best version of your life look
like?’ and ‘what are your personal goals?’ are common openers.
Once these personal goals are defi ned, the fi nancial planner will
see how these relate to your business goals.
It is not uncommon for business owners to focus on the
immediate issues at hand and forget their long-term goals for the
company. For instance, many people do not know what they need
their business to be worth in order to leave them a nest egg when
they sell it.
“We fi nd many people have murky targets,” Ms Tate-Lovery
said. “They get into this spiral of having the weight of the world on
their shoulders and they lose sight of why they are in business.”
Now is the timeLike accountants, fi nancial planners can be with you for life so
it is important to ensure you fi nd the right person for you. The
beginning of a new fi nancial year is a great time to engage one and
take time to plan.
“You need a fi nancial planner and you need an accountant as
each have different skill sets. Financial planners are proactive and
ask the right questions of you to show you what’s really possible to
optimise your fi nancial position,” Ms Tate-Lovery said.
Follow up on outstanding invoices so that you can get payments into your business as soon as possible.
TOOLKIT
Businesses should not leave it until the end of the fi nancial
year to sort out their fi nancial affairs. BEC Australia Executive
Offi cer Mike Hawkins tells the Journal his top tips to get your
house in order for the end of the fi nancial year:
MAINTENANCERegular bookkeeping will ensure that debtors make
payments to you and that you maintain your credit rating
by paying your creditors on time.
BUDGETYou should ensure that you have regular checks of
your budget to ensure that your estimated income and
expenditure is a reasonable refl ection of actuals. If not,
then you need to review your costings.
SPREAD PAYMENTSRegular BAS and IAS returns throughout the year will
facilitate preparation of end of year tax returns.
TRUST ACCOUNTSManagement of any trust accounts needs to be recorded
and may need to be separately audited.
WORK WITH REINSW AS A TRAINER AND ASSESSOR – INTERESTED?WORK WITH REINSW AS A TRAINER
AND ASSESSOR – Interested?
REINSW is the peak industry body for
real estate in NSW and is a Registered
Training Organisation (RTO). As an RTO
we offer learning and development
for individuals looking to enter the
real estate industry, and development
opportunities for those who are already
established within the industry and wish
to further their professional growth.
Due to an increase in business
demand, REINSW are urgently seeking
part- or full- time contract Trainers and
Assessors to assist with the delivery and
marking of student assessments for the
Certifi cate of Registration and Licensing
courses. This will be done onsite at REI
House in Sydney.
WHAT DO YOU NEED TO BE SUCCESSFUL IN THIS ROLE?• Provide a current resume
• Be able to demonstrate recent/current practical industry experience
(2-3 years)
• Have prior training facilitation experience
• Hold a current Certifi cate of Registration
• Hold a TAE40110 Certifi cate IV Training and Assessment qualifi cation
• Have an understanding of VET and Units of Competency
• Hold a CPP40307 Certifi cate IV in Property Services (Real Estate)
or hold a Statement of Attainment for units you intent to assess
INTERESTED? WHAT DO YOU NEED TO DO NEXT• Send the documents listed above with a covering letter to
• REINSW will review your information and contact you shortly.
Please note, only shortlisted candidates will be contacted
REINSW Education & Training
30-32 Wentworth Avenue, Sydney
COURSE KEY Certifi cate of Registration Course Toolbox Series Real Estate Essentials Series
TRAINING
Training calendarJUNE 20142 – 6 June SYDNEYCertifi cate of Registration Course (9.00am-5.00pm)
3 June SYDNEYThe A-B-C of Compliance (9.30am-1.30pm)
4 – 6 June SYDNEYKeeping the Books Essentials (9.30am-4.30pm)
11 – 13 June SYDNEYPeople Management Essentials (9.30am-4.30pm)
11 – 13 June SYDNEYAuctioneers Essentials (9.30am-4.30pm)
16 June SYDNEYIntroduction to Commercial Real Estate (9.30am-1.30pm)
16 – 19 June PARRAMATTAProperty Sales Essentials (9.30am-4.30pm)
16 – 20 June SYDNEYCertifi cate of Registration Course (9.00am-5.00pm)
17 June SYDNEYThe D-E-F of Compliance (9.30am-1.30pm)
18 – 20 June SYDNEYTrust Accounting Essentials (9.30am-4.30pm)
23 – 26 June SYDNEYProperty Sales Essentials (9.30am-4.30pm)
23 – 27 June SYDNEYCertifi cate of Registration Course (9.00am-5.00pm)
24 – 26 June SYDNEYYou and the Law Essentials (9.30am-4.30pm)
23 – 27 June SYDNEYCertifi cate of Registration Course (9.00am-5.00pm)
27 June SYDNEYCreating Impact and Infl uence (9.30am-1.30pm)
30 June – 4 July SYDNEYCertifi cate of Registration Course (9.00am-5.00pm)
30 June – 4 July SYDNEYProperty Management Essentials (9.00am-5.00pm)
In which piece of legislation would you find the Rules of Conduct?
A) Property, Stock and Business
Agents Act 2002
B) Property, Stock and Business
Agents Regulation 2003
C) Residential Tenancies Act 2010
D) Property Agents and Motor Dealers
Act 2000
Visit reinsw.com.au to fi nd out more
How to enter
Go to signedsealeddelivered.com.au, enter
your details on the ‘Contact us’ page and
include your answer in the ‘Message’ box by
30 May 2014. Entries will be submitted into
a draw and the winner of the hamper will be
contacted directly on 2 June 2014. Entry is
open to REINSW members only. One entry
permitted per person.
WIN! A HAMPER FROM
30 Real Estate Journal May 2014
We delve into the Journal archives
to fi nd out what were the hot
topics of the day. This month,
we feature a report on the fi rst
multi-storey building to crop up
in the city after the end of the war:
“City building Co-operative No. 1 Ltd.
Last week announced that they had
received a permit to build a 15-storey
offi ce block in Elizabeth Street. This is
the fi rst permit issued since the war for
a large offi ce building in Sydney. The
State Ministry of Secondary Industries
and Building Materials issued the
permit. The site, 82-88 Elizabeth
Street, is between the University
Chambers and the Balfour Hotel. City
Buildings’ secretary, Mr J. K. Morley,
said excavation work on the site would
begin before Christmas.
“A condition of the permit was that
imported materials would be used,
and enough steel was already on
hand for eight of the proposed fl oors.
Builders would be C. H. E. Gaskin Pty.
Ltd. Another condition of the permit
was that the top two fl oors should be
used for residential purposes.
“‘The project was organised primarily
to house professional people who will
be dispossessed by the city railway
construction,’ Mr Morley said.
“‘It is a co-operative project,
the business and professional
counterpart of ‘own your own fl at’
enterprises which the co-operative
movement has been building around
Sydney in recent years.’
“Mr Morely said that the structure
would cost about $225,000. The
site was bought this month from the
City Council for $58,000 (Contract
Reporter).”
[Editor’s note: Part of the site is now
the location of hip bar Rabbit Hole
Bar & Dining].
YOUR STORYWe want to hear your stories!
If you, or a member you know, supports
a charity, you can share the story in the
‘Last Word’. Email the editor at
It was Harcourts International Managing
Director Mike Green who fi rst asked,
“How can we better support the local
communities that have supported us?”
Out of his musings came the creation
of the Harcourts Foundation. Since its
launch in 2008, the foundation has raised
more than $2m for a variety of charities.
A large part of that money has come from
the franchise’s network of agents who give
‘off the top’ and contribute a set amount
from each sale they make.
Agencies also partake in fundraising
events, workplace giving and auctions held
at the franchise’s quarterly awards. One item
that has proved particularly popular is the
‘surfi ng with the CEO’ item offered by NSW
CEO Rob Forde. A keen surfer, Mr Forde
regularly offers up a group surf lesson, which
gets snapped up by the offi ces.
Getting involvedRepresentatives from the chosen charities
are also invited to attend the franchise’s
quarterly awards to receive a ‘jumbo cheque’
for their grant money.
“It takes some effort and work behind
the scenes, but it’s a hugely rewarding thing
to do,” Mr Forde said of the foundation’s
work. “When we present those cheques to
charities that come along to the awards,
it does go a long way to giving a sense of
purpose to the group.”
Charities are invited to apply for a
grant from the foundation and each
state chooses where funds are allocated.
One hundred per cent of funds raised go
directly to the charities and an emphasis
is placed on supporting local charities
that work in the communities surrounding
Harcourts offi ces.
Over 200 charities have been helped to
date by the foundation and include smaller
organisations such as KidzWish, a charity
whose aim is to enrich the lives of sick,
disabled and disadvantaged children in
regional Australia, among many others.
Beyond the big fishNSW Harcourts Foundation Ambassador
Annie Green takes great pride in supporting
the smaller charities in particular.
“We like to support the underdog, those
smaller charities that do not necessarily have
the money for advertising. We can allow
them a voice,” Ms Green said. “The most
important thing for us is to make sure that we
are giving back to the local communities.”
The Harcourts Foundation was established
on the same principles of the franchise itself:
‘people fi rst, doing the right thing, being
courageous, and fun and laughter’. With
238 offi ces supporting the foundation to
date, it looks to go from strength to
strength in the future.
“When people feel connected to a business
they take a lot of pride in it. Everyone feels
they can contribute,” Mr Forde said.
The Harcourts Foundation takes great pride in helping the smaller charities like the KidzWish, which supports
disabled and disadvantaged children in the Illawara through a range of sporting and supportive services.
Gathering paceSupport for the Harcourts Foundation has grown rapidly since its creation six years ago.
LAST WORD
OCTOBER 1961
IN THIS
YEAR:
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