Call for real estate industry ‘development plan’

Qualified and experienced agents are becoming like top soccer players – an elite band increasingly to be found only in the “big name” teams in the real estate industry, or operating in niche markets..

The reason, says Lew Geffen, chairman of Sotheby’s International Realty in SA, is that only the larger groups can currently offer the extensive training, technology and marketing resources they need to be able to perform at their best and advance their careers.

“Theoretically, anyone can become an estate agent at any time by taking the appropriate courses, passing the set exams and registering with the Estate Agency Affairs Board.

“However, there is considerable expense involved in obtaining the NQF level 4 and 5 qualifications that are now compulsory in SA, and besides that, new entrants have to do a year’s apprenticeship. What is more, the slow market at present means that new agents have to count on having to support themselves for at least six months before they can expect to start earning.

“This is all impacting badly on the industry as the traditional entrants were divorced mothers who needed to earn big money but are now thoroughly put off by the idea of the year’s apprenticeship. There are obviously also not very many people who can live without earnings for six months so entry to the industry at this time is very restricted and the number of active agents remains low. Indeed, there are now only around 30 000, compared to more than 80 000 at the height of the property boom three years ago.”

Geffen says there is an advantage for consumers in the current situation, in that most of the agents left in the industry are seasoned professionals who have proved that they know how to get results in a tough market.

“These are also the agents who have been quick to appreciate the increasing complexities of the property sale and purchase process in SA – and who are so committed that they have embraced the new qualification requirements as an opportunity to further increase their skills and professionalism.”

But there is also danger here, he says, and that is the possibility of dousing the lively entrepreneurial spirit that encourages people to enter the real estate industry and that makes good agents great. “Just as in soccer or any other sport, interest is likely to wane fast if only the big teams can afford to play and then they field the same players over and over again.

“What really keeps competition alive is the possibility of an underdog team making it into the big league, or a star player emerging from obscurity. Our industry urgently needs a development initiative to make sure that talent does not go unrecognised or unrewarded for lack of resources – and more importantly to ensure that our service to consumers keeps being honed by healthy competition.”

Article by: www.sothebysrealty.co.za