Will Technology Replace the Real Estate Agent? by Harcourts Platinum

When you look at some other industries, such as the Travel Industry, technology has had a significant impact on their viability.  I travel extensively and I haven’t used a travel agent for many years.  Does this mean that real estate agents will perhaps be replaced by technology in the near future?

If you think about it, buyers now have access to most property listings through the property portals – much in the same way that a traveller can access flight and hotel prices online.  Wouldn’t it be possible for a buyer to purchase a property online and cut the agent out altogether?  Technically it’s possible – but is this good for a seller?

The short answer, I believe, is “no”. It’s not good for a seller and therefore technology won’t replace the skilled estate agent.  But what it will do is ensure that estate agents need to demonstrate their value to the seller in order to survive.

When an airline sells their seats they do so on price.  That’s the price and you either pay it or choose another flight offering you better value.  There is no negotiation.

In real estate, there is a very real negotiation between the seller and various buyers that show interest – and the way this negotiation is handled will make a significant difference to the price the seller will get.  Technology cannot replace the skilled estate agent in this process.

Every seller wants to sell his property for the maximum market value.  In order to achieve this, marketing and selling strategies need to be employed to attract maximum buyer interest.  This is where technology does play a large role – and it’s important that skilled agents use the technologies available to ensure a listing is exposed so as to appeal to a wide buyer pool.

The agent then needs to work that interest to the point where buyers make written offers to purchase a property.  There are many components to an offer that can be negotiated until both buyer and seller agree: price, terms, and timing.  A lower offer with better terms and timing could be much more attractive to a seller than a slightly higher offer with onerous conditions.

Additionally, a seller would need to know from their agent what other potential interest there may be before accepting an offer.  Could there be other pending offers?  Could the agent get the buyers to compete for the property?

It’s not uncommon for a skilled agent to sell a property at more than the list price.  We recently closed a sale at 12% above list price, much to the delight of the seller.  Technology would not be able to achieve the same result and the human element that manages the negotiation is critical to the result.

That doesn’t mean that all agents are indispensable.  Only those who demonstrate their ability to use technology and their marketing strategies to create buyer competition, and who have strong negotiation skills, will add real value to the seller.

If you would like to know what your Harcourts Beachfront agent can do for you, give us a call on 041 583 4034.

SOURCE:  HARCOURTS PLATINUM

8 things to check before renting an apartment

Finding a new apartment to rent can be an exciting and promising time for any tenant, whether you’re new to the rental game or an experienced player. But jumping head first into a new lease without first carrying out an in-depth walk through could leave you with a fair amount of unnecessary woe to deal with.

Tenants should always insist on viewing a property before signing on the dotted line. Besides being able to spot potential issues, you will avoid the risk of falling for rental scams. Not only is signing a lease without viewing the apartment ill-advised, tenants often run the risk of falling for rental scams when doing so.

Below is a list of things to pay close attention to while viewing a potential apartment:

1. Doors and windows

Be sure to check that all the doors and windows open and close easily, especially sliding doors! Also make sure that the doorknobs aren’t wobbly and that the locks work. If any locks are broken or missing, be sure to bring this to the landlord’s attention so that you feel safe should you choose to move in. It’s also worth taking note of any draughts or sealing issues as this could make a difference to your electricity bill when it comes to heating or cooling the apartment.

2. Walls and floors

While a small crack in the wall isn’t anything to be too concerned about, any crack that you can slide a 50c coin into could be a sign of bad structural integrity. In fact, spotting any structural flaws should serve as a warning to rather set your sights elsewhere.

Also, be on the lookout for any water damage or watermarks near the floorboards, on ceilings, and on the walls. Water damage indicates that something is leaking somewhere, which means that mould, mildew, or rot could set in if it hasn’t already. This could pose a serious health risk especially for those prone to allergies or respiratory infections.

3. Appliances

Although most apartments in South Africa come unfurnished, it is worthwhile checking that all supplied appliances are in good working order.

Check that the stove plates and/or gas hobs work and that the oven heats up and is free of grease or cooking build-up. Also, be sure to check that the fridge is cold, if one is provided, and if there’s a washing machine and tumble dryer, look inside to make sure that these too have been well maintained.

4. Consider your furniture

A common mistake tenants make is signing the lease on an apartment before checking if their furniture will fit in come moving day. One sure way to avoid this is to measure all big-ticket items like beds and couches before viewing the apartment so that you have an idea of whether it can fit as well as how things can potentially be configured should you choose to move in. It may even be worthwhile taking along a tape measure to measure the floor space for even greater accuracy.

5. Cellphone signal

It might sound unlikely in this day and age, but some areas still don’t have the best cellphone reception. With this in mind, take a moment to check your phone’s signal and connectivity during your walk through. If the lease includes WiFi, ask the landlord to demonstrate that it works and that it is currently connected with a strong signal.

6. Crime

Living in a country where crime is an everyday concern means that it’s important to get to know the area you could end up living in. Check the security features of the apartment i.e. is the property access controlled by a guard or does it have an alarm system. It’s also worthwhile finding out where the local police station is and asking them, or even existing tenants, what crime is like in the area. If they are unable to assist, a simple Google search might help give you a good idea of any crime statistics and reports.

7. Parking

If you own a car, parking arrangements should definitely be on your list of things to check out. In many neighbourhoods – especially in the city – street parking can be hard to find or unsafe for both you and your vehicle. Finding an apartment with a garage and/or an inside parking bay is therefore a necessity. Remember to ask whether the apartment comes with allocated parking and whether there is an additional cost for this.

8. Noise levels

Before leaving, take a moment to listen to the neighbourhood and surrounding noise levels. Note how loud the traffic is, whether there are barking dogs or how easy it is to hear your neighbours. If you really like the apartment, try visit more than once and spend some time in the surrounding neighbourhood during the day and night. You may find that it’s much noisier at night, for example, so this will give you a better idea of what you’re in for.

While these are just some factors to be aware of when flat-hunting, there are many others – like checking for signs of pests, making a note of how easy the apartment was to find, looking at the upkeep of communal areas etc. Considering these factors when viewing potential apartments can help you find the right apartment and ensure that you aren’t caught off-guard later.

Once the lease is signed, you’re in it for the long haul so make sure that the apartment you choose doesn’t have any major issues that will make lead to renter’s regret.

Tough Market Calls for Different Strategies

Yes, the market isn’t what most sellers would like it to be.  Difficult economic times are definitely impacting buyer demand.  Inflation is increasing, incomes are not, and many businesses are taking strain under the conditions.  The result is that buyer demand has decreased.  It’s a reality, and there is nothing that any agent or seller can do about the state of the market and the economy.

 

But that doesn’t mean that, if you’re selling, you can’t achieve a good result.  In order to do so, your selling strategies will need to change.

 

As with all markets, when demand decreases and supply increases there is usually downward pressure on pricing.  We’re seeing the same happen in the local property market.  Volumes of sales are down by about 50% in most price ranges.

 

There is no need to panic.  It doesn’t mean that property prices are drastically falling.  What it does mean is that buyers now have more properties to choose from and they are only reacting to properties that represent the best value.

 

We sometimes have sellers suggest to us that the price on their property has no bearing on buyer enquiry.  Nothing could be further from the truth.  Price creates interest.  That’s why shops have “sales”.  It doesn’t matter how much you want a product. If the price doesn’t reflect the fair value you won’t be purchasing it.

 

The facts clearly show that we’re in a very different market to the one we’ve become used to in the last few years.  It’s hard to believe that many agents haven’t adjusted their strategies to cater to this very different market.  The result is that properties will sit on the market with few viewings and no offers.

 

So what needs to change to get a result?  For one thing, the approach to pricing needs to change.  If there are 50 properties on the market with a similar offering, buyers won’t view them all.  They will view the listings that seem to represent the best value.  Their shortlist won’t include overpriced properties.

 

Our research shows that buyers react to properties that are listed at less than 5% above market value in this type of market.  If you’re 15% overpriced you simply won’t attract the right buyers.  Despite this, we see many agents overpricing properties by as much as 35% in order to “buy” a listing.

 

This practice of overpricing isn’t only unethical, but it will cost a seller dearly when they have to sell for less than market value after many months on the market.  Don’t’ fall into this trap.  More than ever, your pricing is critical to you attracting the right buyers and selling for fair market value.

 

In addition to pricing, there are other strategies that need to be implemented in order to achieve a sale in a tough market.  If you have a property to sell, select an agent who can demonstrate what they are doing differently in the current market to get you the result that you deserve.

 

Steve Caradoc-Davies

Principal, Harcourts Platinum