Breath easy, the grant stays

So finally we have our answer, the first home buyers grant will remain for three months at the full rate and three months at a reduced rate.

*Insert collective sighs of relief from the entire real estate industry here.*

This is a good move by the Government and one that has seen the industry dodge a very large bullet. If the grant was ceased on June 30 first home buyer activity would have come to a screaming halt and the market place repercussions would have been quite dramatic.

Through phasing out the grant the Government has paved the way for a more orderly market adjustment. The economy is expected to stabilise over the next 6 months and interest rates are expected to stay low. Together these two factors provide an opportunity to offset any shock when the grants do finally stop. The move to keep the grant for both existing and new properties is also positive and avoids any distortion.

So what now? Well historically Government intervention coupled with low interest rates is the pre-curser to the upside of the property cycle. This doesn’t mean everything is roses, what is does mean I think is that the market is likely to continue ticking along as it is until well into 2010 – it is a time to have a positive, but balanced view of the market place.

What was missed in the budget is any sweeteners for investors and second and third tier buyers. Investors are a big piece of the puzzle that is missing right now and through creating strategies that would entice them back into market the Government could have created a far more balanced market place, rather than just relying on the first home buyers to keep us a float. Australia is also in the midst of an ever growing housing stock crisis which cannot be addressed by the first home buyers grant alone. I have pointed out the need to broaden the stimulus here before, so I won’t cover too much old territory there.

All in all budget night was a positive night for the industry. The ‘what ifs?’ around the first home buyers grant are now answered and it is business as usual.

Be happy, be innovative

The boom has left us hanging onto mediocrity. We’ve become comfortable because it’s been easy. We’ve been letting other people take the gamble and the chance. Now the GED has rudely shocked us and rocked us out of that rake-it-in coma.

People are preoccupied with the darkness and gloom but you’ll always find someone living with less light and hope. While Australia is the 18^th wealthiest economy in the world according to one website, apparently we are also the 6^th happiest country in the world.

If you’re not feeling like you’re part of the Top 10 happy places in the world, perhaps it’s because you’ve been paying too much attention to miserable advertising. Notice how quickly television and other forms of advertising have jumped on the bad times band wagon? They’ve taken up the language of a bleak economic climate and adjusted their global economic crisis vocabulary so quickly it’s hard to believe the Ikea-loving Swedes and Canadians are behind us on the happiness ladder.

The days of the spin merchant are gone however and we can’t afford to be seduced anymore. We have neither the time nor money. You just can’t “trust” blindly anymore. Find people who you know are good at what they do or come recommended by those you trust. Work with people who actually have the solutions to your problems, not just people who say they do.

Most of us are pretty clever about what we’re being told, but now more than ever it’s important to see the real message being communicated and not be manipulated by the spin.

The up-side of this down-turn is now we have the perfect chance to make a difference. To be different. To think differently. To strive to be better. To do things which have never been done before.

Whether you’re going to seriously commit to household recycling, buy a home or get involved in a business venture, it’s time for innovation and the climate is ripe for it.

In our recent In Property magazine, Perth horticulturalist Josh Byrne shared with us how planting a verge garden got him out of the back of his house and greeting his neighbourhood. By creating a nice place to be at the front of his house, he’s met the people in his street and made friends with his neighbours.

It’s a grass-roots gesture, but we need them to lift our spirits. Feeling good about yourself and the world around us is what convinces someone somewhere with a great idea to pursue it. They say it takes a village to raise a child. It’s a valuable mantra to have at the moment.

Let’s cultivate the art of being better, of giving great service and “doing good”. Unprecedented times call for unusual measures.

Realmark the aging pop star?

This month at Realmark we are celebrating a very significant milestone – we turn 20.

20 years ago my wife and business partner Anita and I flung open the doors to our tiny little agency, just the two of us and some second-hand office furniture.

We now employ a team of more than 120 people across seven residential offices and a commercial division. I’ve been asked many a time what is the key to our longevity, how did we survive this long in the notoriously fickle world of real estate? Well I’ve got to say, we took a leaf out of Madonna’s book and learnt to reinvent ourselves over and over again.

No matter what you think about Madonna, there is no denying that the woman has managed to sustain a very successful career over many years through adapting and making herself relevant to the next generation of music fans. We may operate in the far less glamorous world of real estate but let me tell you, Realmark have had many different looks over the past twenty years and I honestly think that is what it takes to succeed in this industry.

Real estate is a funny business, it is so heavily influenced by the economy, by consumer sentiment – it is unpredictable. So if you want to work in that space, you have to be ready to take the ride and be willing to adapt and evolve with industry as necessary. While this definitely rings true for real estate, it really applies to any business – you need to stay relevant. Change can be a scary thing for many, but it is not something we fear around here because we cannot afford to. A major part of our everyday business strategy is keeping one step ahead. We are continuously researching technology, communication, marketing – anything that may improve the way we service our customers and help us stand out from the crowd.

No, Realmark is not the same business it was in 1989, and we won’t be the same business we are now five years down the track, I will make sure of it.

For me the past 20 years have been a challenging but very fulfilling ride. If I may get a little sentimental for a minute (well it is my blog after all), many people often measure success in dollars, but I can honestly say that for Anita and myself the highlight of the last 20 years is seeing the business and the people in it grow and prosper. What is a business without its people? We are lucky to have the best of the best working with us, so thanks to all of you.

Happy birthday Realmark.

Find your own value level

I went to an auction recently where an apartment was being offloaded for $2 million plus. I walked around it and marvelled at the designer taps and marble floors. I wondered if anyone ever got any sleep in a bedroom as ostentatious as this one.

By the way, how ARE you sleeping?

I’m sleeping very well. Why? Because I know my values. I know what they mean to me what I am willing to sacrifice. I am also clear on what’s not negotiable, both in and out of the office.

I saw Dr Markus Miele speak while he was in Perth. His great-grandfather co-founded the 110-year-old business which sells the quality appliance brand, Miele, worldwide.

During his speech, it struck me that this man and the company around him are clear on their values. Key points of how they operate include not becoming a discounter and focusing on always getting better by innovating and improving what you offer. Dr Miele noted that consumers will pay for value when the value of what you are offering is explained or demonstrated to them.

While he might have been talking about white goods, they are pretty good principles to apply across business and your life.

The uber-rich will always be so, but it’s the people renting their rich and famous lifestyle from the banks who are learning the hard lesson. It hurts. This rate of consumption is not God-given, or even a Jimmy Cho-given right. Those sprees are hitting you right in that $3000 King Street handbag. The devil (who is not wearing Prada) is standing at the door, banging loudly and demanding to be paid.

For the rest of us, quality is what now counts. We’re spending more carefully and want to know what the values of the products we are buying are.

It’s also about finding the new balance and level of those values. Does a salesperson turning up at your house in a shiny new luxury car make you want to deal with them more or is it now about the quality of the service they provide.

For most of us, we’re now looking for quality that will last and don’t mind spending a little more of our hard-earned dollars if it’s a cornerstone of the product.

Even British fashionistas Trinny and Susannah advocate spending money on classic pieces and less on trendy, seasonal items. They always look good, so it’s hard not to agree.

Perhaps now is the time for smart statements – not gauche ones – at every level, from how you invest to how to you live.

Hardwired to own

Property is more popular than porn.

Yes! You read that right.

I went to a seminar recently where Rental Express MD Chris Rolls told us that 42% of people who have access the web view porn but 74% of people who have access to the web check out the real estate.

Sure, some of them are looking at villas in the south of France, dream homes on the Dalmatian Coast or a funky loft in New York, but the majority of people are looking for a local place to call their own.

It’s really no surprise given shelter is one of the fundamental concerns in our life. Everyone should be invested in that idea.

People like to look at property or homes because they feel an emotional connection. Love and greed – or both – are drivers. There’s the desire to have a place which shelters your person, your family and your soul. It something you can make pretty and entertain in. Alternatively, it’s a place which offers good investment return.

Australia is a country so very wired into the notion of home ownership. Unlike our European cousins who in many cities never even consider the idea of owning. Renting just is what they do and they’ll do it for life.

We’ve adopted the post-war view of a house in the suburbs and very much built the foundations of our life around it. In times like this we naturally become rather sentimental about our homes and they morph into even more of a backbone and a blanket. Security equals salvation in this climate; homes become the icons of our lives.

Australian society honours ownership. From advertisers showing off massive plasma televisions to home builders and the government, everyone is trying to convince us this is the best thing to do – and do now. There’s an expectation that owning a home has become a divine right and buyers want the best deal.

The post-Gen X and Y’s are fixated with having things quickly and early and they’ve been partly responsible for the uptake in city apartments. There’s now a generational expectation they will become involved in the property market early rather than waiting to become established in other areas of their life. We’ve wired them to do that and push them at every level.

Balancing that out, their psyche sees property more as a commodity and they have a positive, flexible attitude towards it. Unlike the homes of our grandparents which were homes for life and where the furniture may as well have been cemented to the floor, this generation will live in many more homes over their lives and have fewer or no reservations about diving in.

Property is a symbol about everything good in our society and it’s driving young people to buy in record numbers. If you’re a cynic, you might say that people are using real estate views on the Net as the new porn – to dream about the place they want but may never own.

Downturn? What Downturn?

It can be hard to ignore the endless headlines of doom and gloom, but I refuse to participate. Realmark is not participating in the recession.

I am not denying that things have certainly changed, but this is nothing new, this is what happens in this industry and I have seen it many a time before. Panic is not going to see you these times, being prepared and having a clear head will.

If you manage to look past all the bad news you will see a range of rare opportunities that don’t come about very often. The words recession and opportunity might not seem to fit together, but the way I see it, recession is a time full of opportunity for my business.

So exactly what opportunities am I talking about? Firstly the demand for agents has decreased significantly so recruiting quality people is much easier. Realmark has just employed seven new team members, something that was almost impossible during the boom. We are using the downturn to build our ‘dream team’. We launched an online careers website and to help us attract the right people and we have hired a full time human resources manager to help us retain the right people.

Now is also a time to stand out from your competitors. It was easy to be successful during the boom, being successful now takes skill because business doesn’t simply walk in the door. People will notice if you’re thriving now and it will build a premium and trust into your brand that is almost impossible to achieve during the good times.

Then there is the fact that now is a good time for growth into new markets, some competitors are going to scale back and opportunities will open up and we stand ready to take advantage of them.

So you can dwell on the bad news, but really what is that going to achieve? Open your eyes and look for the good news.

When you escape your comfort zone, good things happen

I attended the Elite Property Management workshop in Brisbane with John a few weeks ago and I thought I’d share some of my thoughts.

 

The workshop brought together a select group of property management professionals from around Australia and it was a very valuable opportunity to hear from our peers. Each one of us shared the same aim – to push the Australian property management industry to the next level.

 

It was also a great opportunity for us to step back and really look at what we are doing. Because getting away from your desk, your staff, your routine helps you stand back and look at what is really going on. What is working and what may not be the best.

 

Yes we found things about our property management services that need work, but most importantly it was a great feeling to know that a majority of what we are doing is definitely best practice in this country. We are not behind the eastern states, but in many ways we are different. The workshop attendees were blown away by our marketing materials and that was a reassuring endorsement of the way we do things at Realmark.

 

Overall it was serious motivation to keep getting better and we have returned full of ideas and ready to push our property management services to that next level. Which is very good news for Realmark’s property management clients.