You be the judge…are Lawyers Real Estate breaking the law or not?

As a licensed real estate agent within the state of NSW, if I was to open a business as Greg Vincent Lawyers or Greg Vincent Solicitors, etc without the right accreditations in place then how long do you think I could remain conducting a legal practice?

Yet, Peter Mericka of Lawyers Real Estate has either found a loop hole in the Victorian agency licensing legislation or Lawyers Real Estate has simply been placed into the too hard basket and has been allowed to continue to practice under the business name Lawyers Real Estate for the past 4 – 5 years without having undertaken any formal real estate licensing… That’s right! 4 – 5 years without a real estate license.

Either way, judging by Peter Mericka’s statement within his video on Today Tonight below and a letter from Robert Guthrie of the NSW Fair Trading Property Services Licensing posted on the Australian Real Estate Blog it would appear that Lawyers Real Estate may be looking to expand their real estate operation into other areas and possibly interstate.

Now I don’t know if it’s simply because of the name of his business that the industry bodies are too scared to take Peter Mericka on or whether there is in fact a loophole within the current Victorian legislation which entitles him to legally continue to operate in this manner as Lawyers Real Estate?

But if there is a loophole, is this business model what agents can expect to see more of into the future?

As a licensed agent I have invested a lot of time and money to achieve my licence and remain licensed.

I continue to pay annual renewal fees and have to undertake ongoing training to obtain the required CPD points required to continue to hold a real estate licence year after year. After watching the Today Tonight story about Lawyers Real Estate, I’m starting to wonder what on earth I’m paying the fees for.

I have to say that I agree with one thing that Peter says in the Today Tonight interview, “the people who matter are the real estate consumers”.

Which leads me to wondering if something did go sour with a transaction via Lawyers Real Estate would the consumer be protected by the Victorian Property Fund? Or is there a different fund that they can make a compensation claim through?

Listings appearing on realestate.com.au

And then there’s the issue about whether Lawyers Real Estate should be allowed to upload their listings onto realestate.com.au as they currently do.

Under the latest version of the General Terms and Conditions for Residential Subscriptions to www.realestate.com.au it clearly spells out who can upload onto their site…

2.1 You represent and warrant in respect of each property you list on our web site that:

(a) you are the holder of a current real estate agent’s licence in the State(s) or Territory to which your use of the Service relates;

(b) you have a signed authority to sell from the owner or vendor (such as an Agency Agreement or Authority to Sell); and

(c) you are authorised to make available the material uploaded or submitted to use the Service;

(d) you will not allow another real estate office in your real estate group to list the property using your subscription. Where a proprietor of a property authorises multiple real estate offices in your real estate group to list a property you acknowledge that:

(i) this does not entitle you to authorise any other person (including, without limitation, any associated offices in your real estate group) to make use of the one subscription; and
(ii) any such conduct is in breach of these Terms and Conditions; and

(e) you are providing the full range of agent services (as set out in our Private Listing Policy).

Whilst Lawyers Real Estate don’t appear to comply with this section of realestate.com.au’s T & C’s and their ability to continue to upload onto REA is up to the respective legal departments to sort out, one thing I noticed is that Lawyers Real Estate appears to have very little regard for wanting to comply with some of realestate.com.au’s AUP.

Under the realestate.com.au Acceptable Use Policy (AUP) – Residential, it would appear that REA don’t allow other website addresses to be promoted within the copy text of a property being advertised yet Lawyers Real Estate are currently including the URL www.SLOD.com.au within the body of the property text when uploading their listings which appears to be in breach of 4.1.6 the Misuse of fields.

Here’s a screen capture…http://screencast.com/t/YmU2ZTQwNTg

Misuse of fields
4.1.6. Placing irrelevant information in an information, description or picture field. You must only use the information, description or picture fields for inserting information that is intended for those fields. For example, inserting the name or contact details of your business or agency in the description header or property description field is not acceptable. Inserting a business or agency logo as a picture in a property listing is also not acceptable.  For copyright purposes, small watermarks are permissible on images, but only in one corner of the image. Superimposed wording or text is not permissible.

The SLOD.com.au URL provides a link to Lawyers Real Estate online service for bidding, making enquiries and booking inspections, etc. If the URL is allowed to continue to appear on Lawyers Real Estate’s listings under the legal interpretation of Clause 4.1.6 or other parts of the realestate.com.au AUP, it could then open the door for agents to feature website URL’s within the property text field.

What about Privacy Laws?

On top of that, uploading the seller’s contact phone number onto a public site like realestate.com.au is not only in breach of 4.1.24.2 in REA’s AUP but wouldn’t that also breach other Privacy Laws?

Here’s a screen capture…http://screencast.com/t/NTczN2ZiOT

Note: For privacy reasons I have covered the seller’s name & contact number.

Other inappropriate content
4.1.24. Using the Service for any unlawful, illegal, malicious or improper purpose. For example: it is not acceptable to, in your use of the Service, display material that:

4.1.24.1. may defame or discredit another person or business;

4.1.24.2. may disclose private, personal or confidential information;

4.1.24.3. might be considered obscene, offensive, menacing or abusive;

4.1.24.4. might infringe the intellectual property rights of others;

4.1.24.5. may violate any law, regulation, standard, content requirements or code promulgated by any relevant authority or industry body.

I’m sure Peter Mericka of Lawyers Real Estate will be able to shed some light on how this is legally OK?

I’d also be interested to know if clients sign an agency agreement when they list with Lawyers Real Estate and whether the lawyers have signed an inspection report and included opinions of price on the property or do they simply rely on an independent valuer to assess the price for their clients.

And if so, is the registered valuation an added cost or is it included in their flat fee?

If Lawyers Real Estate has indeed found a loophole and they are allowed to continue without the normal licensing that a real estate agent has to have then as I mentioned earlier, it could open a huge can of worms and we could see a lot more lawyers opening up real estate agencies.

If this is allowed to continue then agents should really start to question why we are paying annual licensing fees to the government departments if they won’t police and legislate the licensing of the industry more effectively.

Plus, I’d be really interested to know how Lawyers Real Estate got to be on realestate.com.au in the first place?

Finally, I don’t have an issue with the discount commission model that Lawyers Real Estate are using because discount real estate agencies have been around for years and are now a dime a dozen, but it does concern me that some consumers may feel that going to a Lawyer to sell their property is going to mean that they feel protected and that they are going to get the best deal.

For example, here is a video of what some of Lawyers Real Estate clients have said…

If you’re considering employing a lawyer (either with or without a real estate licence) to sell your property then it’s important to remember that in the end they are in business and they will expect to get paid a commission.

And just because the negotiations are done by a lawyer doesn’t guarantee that it will always turn out to be the best thing for their client. Many legal deals end up being negotiated on the steps of court rooms and it’s not always the case that a Lawyer’s client walks away 100% happy with the end result.

Consumers still need to do their due diligence because in the legal profession, as per the real estate profession, some people get good representation and others get poor representation.

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Yet Another Stuff Up!!! Where is Our Data Going?

This is the question that an agent posed to me earlier today after yet another stuff up by the big boys.

I was speaking at an event yesterday where one of the agents mentioned the CommBank Property Guide iPhone App and the significant amount of data that was now being made available via realestate.com.au and RPData.

As the discussion went on, one of the agents logged on and started searching through the Comm Bank’s app. Only by fluke, another agent suggested they take a look at one of his latest listings which is going up for Auction.

The listing agent was absolutely horrified to see that the property which was uploaded onto realestate.com.au as an auction now appeared on Comm Bank’s app with an asking price displayed.

The price that was displayed on the Comm Bank app was the same price that the agent had inserted under the search price field.

Any pricing entered within the search price field has always been a hidden price whether a property goes up for auction or whether it has an asking price. These prices have never been for public viewing, or at least until now.

I was blown away when the agent showed me the listing in question on the Commbank site. I couldn’t believe that something so fundamental and basic could be breached.

I followed up with the agent again today. To REA’s credit the pricing issue for that listing has now been rectified but in typical fashion the agent was told that it’s not their fault the issue seemed to be from CommBank’s side? So who’s fault is it really?

Agents don’t have an agreement with CommBank’s Property Guide app, they have an agreement with REA Group.

Under the circumstances, should agents have the option to not make listings, etc available to Comm Bank’s app?

Is this only an isolated case? Has it happened to others? Will it happen again? Can REA Group and Comm Bank guarantee that no such issue will ever happen again?

Can you imagine what would have happened if the vendor had seen it? Who knows whether a buyer has seen it or not? Does this mean that agents have to check every listing on every site that their data is being uploaded to?

NOTE: Out of respect for the agent and the vendor trying to sell their property I have deliberately left out the specific details of the price, property, area, agent, etc because sharing that information could have a detrimental impact on the result of the property auction.

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Why Google will win the war – it is not even fighting!

Google will overcome the teething problems with its real estate proposition and disrupt the business models of property portals across the world.

Every single property portal in the world is wary of the Google Real Estate presence over the past few years and every single portal is scared of the effect Google will have on both their visitor numbers and there revenues.

Over the past year I have read a lot of articles (from portals, their newspapers or individual shareholders) demonstrating how Google’s entry into the market place has not or will not effect either their visitor numbers/revenues. Well they would say that wouldn’t they!

Google’s Effect

It is true so far that Google’s effect has been minimal, however Google has never stated it’s intention to kill off or mame any of the leading portals in the world in a time limited period! In fact, Google is focusing on getting as many listings into their systems as possible, forming new partnerships with various entities to help them get their listings into Google and finally continually refining their systems to make it easier for people to find the property they are looking for, then shoot them off to the originators website of that listing for complete property information.

Once Google has these three elements close to perfect, they can then think about a mass marketing campaign through, yes you guessed it, the most powerful online marketing tool on the planet – the Google Search Engine!

The two big differences Google has that others who have failed before them do not – is time and money!

Google’s mantra is to “Don’t be Evil”. Think about this, who are they going to upset with a successful assault on the property market? In the USA MLS providers? Come one, hardly anyone thinks they serve any purpose other than hanging on to a business model that expired in the early 90′s. Fee based real estate portals? Just about every real estate agent in the world rates their fee based real estate portal only slightly north of Saddam Hussein.

The free listing portals may need to adjust their business models, but specialized search engines like www.estately.com would probably welcome the success of Google!

All in all a Google success would mean current successful businesses will have to adjust their business models, evolve into new offerings, improve their practices and innovate – after all, isn’t that what capitalism is all about?

Everyone is in a rush to judge Google on their immediate impact. Real estate is just another business Google is involved in and they will take their time before marketing the product globally. Just don’t expect any of the incumbents real estate portals (many owned by news organisations) to rush out with a headlines promoting their competition, like ‘Google having an impact, revenue and visitor numbers plunge for xxxx.com’ )

The incumbents will always find a light for their own real estate businesses whilst shedding darkness on their competitors. This is the toughest thing for Google in real estate – getting the free headlines they attract in different markets (search, telephony, Internet). With property they are playing against many of the largest media companies in each country, which means fewer free promotions for their real estate services!

Google is a publicly traded company, it is a profit machine and there is no bigger game globally online for revenue than real estate. To be the number one real estate destination worldwide for property listings would be worth anywhere from $3 – 5 billion in additional revenues for Google, they just don’t realize it yet.

This is not to say Google needs to improve what they are doing and needs to form new partnerships to do this – it does! One area they can improve upon is rewarding individual agents for feeding their listings directly to Google by giving them the referral . At the moment it seems a bit of a lottery as to who gets the referral when a user clicks on a listing to see the full information. It should go to the originator of that listing – the person who signed the vendor. Not some portal or directory. This should not be that difficult!

Google also needs to acquire a few tools in the long run. I do believe Google will acquire a listing system/engine and offer it for free for agents and web developers/portals to hook into. In full disclosure, this is the very business I operate (www.zooproperty.com). However the reason I think they need to do this is because it gives them some control over the cycle of a property from listing to sales/rentals to sales/rental history, it also allows for them to know who the listing originates from.

If Google launched an open system that allowed agents to manage their listings and then distribute them across a variety of platforms they would get 90% of independent agents on board within a year. Every single portal in the world would join up to get feeds from that system and web developers globally would rejoice in finally having a system they can play with. Google will also be able to integrate Google Adwords, Adsense and other tools directly to developers and agents.

Also, never underestimate the power of the open web developer, one only has to think of the success of the Firefox browser to showcase how powerful the common web developer has become. If you build something that helps the web developer, the marketing power of that alone is enough to propel a product into the spotlight.

If Google take their time and work with agents, developers, portals and listing systems they will have an impact, it will come down to how much they control as to their next move, however once they start seeing the revenues flow in you can be sure Google will expand their presence.

If you are a real estate agent, you need to get all of your listings to Google, talk to your web developer, for them to build this into their system (if they already haven’t) should only take a few days.

You need to do this anyway, invest the time and you will be rewarded.

Note: A Version of this article first appeared on Global Edge UK.

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realestateVIEW.com.au acquisition of MyHome.com.au

On the 5th of August we at realestateVIEW.com.au announced the acquisition of Myhome.com.au, taking us one step closer to becoming a truly national portal.

The creation and success of an industry based portal is an issue that has been hotly debated on Business2 in the past, as has realestateVIEW.com.au’s ability to be a significant force in the market.   I believe that our latest acquisition proves how serious we are about delivering a valuable product to the industry and our members.  This news coupled with the recent content sharing agreement with REIWA.com.au (which allows Western Australian properties to be displayed on the RealestateVIEW.com.au site) will provide a huge increase in coverage nationally.

So why have we acquired MyHome.com.au?

This new arrangement provides several opportunities for our business, however in particular MyHome.com.au provides us with 2 key advantages;

1)      Strength In New States – After recently launching in NSW, the new arrangement will add significant strength to content in these states as well as providing a large boost in Queensland where the site is yet to officially launch.

2)      Complementing our Existing Services – For realestateVIEW.com.au this sale will complement our existing offering for estate agents around Australia.   With a captive audience in NSW and QLD through MyHome.com.au we are able to extend our reach and exposure for the many new agents coming on board to the realestateVIEW.com.au site.

It is exciting times ahead for Australia’s industry owned portal and we hope the industry is as excited about this as we are.

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An 11 year real estate online business case study

Having just sold a real estate online business, almost eleven years to the day after it was founded, I thought I’d share some thoughts before they were lost to the sands of time…

Start Up
Starting a business is relatively easy, as it involves buying things. Buying a company name, a domain name, some IT and marketing skills, office space…  it’s the running of it that is tough. And if you were starting up in a whole new industry (online real estate ads) in 1999, then it was tougher still. But sometimes people like to give the new guys a go, and for that I salute Western Australia, not somewhere I grew up in, but the place I’ve called home for 13 years now, and a State where new ventures (be they junior miners, baby bios or anything really) are welcomed and often where (due to its remoteness) new products can be quietly launched. The first dotcom boom helped: if you had an MBA, a dotcom idea and a pulse people threw money at you. Perhaps your nerve is the only thing holding you back. The support of a wonderfully supportive spouse or partner helps a great deal, as does the sage advice of a few business people & MBA professors you look up to.

Getting Out There
As many of us know by now, major new IT projects can take three times as long (and cost three times as much) as you think they will. IT has a certain logic to it, that you will learn along the way, but with no experience in IT, real estate or business, we are testament that you can certainly give it a go, and if we can do it, let me tell you, you certainly can. But choosing your business model (advertising, e-tailing or subscriptions were the three in existence when we began) is going to be critical, as is gaining a foothold and moving towards that all important tipping point where enough visitors are coming to your site to view enough content. Without that, you will not enjoy the ride much.

We picked off the top end suburbs, mainly because we hailed from there and thought the internet use would be highest in those areas and many would have fastish web access from their work computers in the city. (Remember, this was in the days of dial up. No one had heard of broadband.) We figured that the real estate agents that plied these areas probably had the success and advertising money to pay for such a new service and might get it sooner than those out in the boon docks. So it proved.

We were also lucky that realestate.com.au and domain.com.au were not around at the time – in fact they weren’t to place salespeople on the ground in WA until we were well established. There were local competitors trying to beat us, and property.com.au were probably the major force at the time, so it was our cool technology (“interactive mapping”) and our parochial nature (“we’re just around the corner!”) that we pushed as our unique selling points. The local Institute site reiwa.com (for some strange historical reason) had not made much impact in the western suburbs, so really the area was there for the taking. It was a land grab.

Most of business really is about remaining close to your customers, and so we spent a lot of time talking and listening to them. We did not have bucket loads of cash to spend on marketing (we’d have just wasted it if we had) and so we had to be a little street wise about how to build traffic, get good SEO results, get our name out and evolve our business model through the years. We moved into web design, print, seminars and such (none of this bore any mention in our original business plan) and so the words of Amir Bhide came true: “just get out there, because opportunities only present themselves by you being out there”. [Bhide’s 1993 ‘Bootstrap Finance’ Harvard Business Review article had become our Bible.]

What Worked?
Like many businesses, we have tried lots of things, thrown away what didn’t work and kept what did. So what worked?

1. The perpetual shift of eyeballs and advertising dollars from print to online was the major ‘wind beneath our wings’, but this on its own would not have been enough (although it was a necessary factor)
2. True attention to total customer service was critical – easy to say, but only evidenced in a million little things done day in day out over a decade. Real estate clients can annoy you, can be unfair, can be wrong… yes, so what? Without them, you are nothing. Most of the time, they happily use your services, pay their bills on time and keep coming back for more. Trust follows. Invaluable.
3. Hiring and Retaining the best people – we’ve always had good people, sometimes certain people did not fit (so they had to go). People are not only your best asset, in a real sense, they are your only differentiating asset.
4. Being Realistic. There will be tough times, sometimes you just have to admit defeat, sometimes you have to push through the barrier and win. This involves judgement and gut feel, but also a healthy dose of reality and reflection (Jim Collins’ ‘Stockdale Paradox’, from ‘Good to Great’ 2001)
5. You can R+D yourself into Bankruptcy. True, the web site is important, and its fun having lots of cool stuff on the portal, but there has to be a balance between making money (sales) and developing a nice site (R+D). I had lots of battles on this one over the years. Sales is hard work, but it is the most important too. Pick up the phone, make that call. Everyday. The reward for making some sales is some time in R+D.

No doubt readers of this will have other comments on ‘what works’.

Exit
Maybe the most difficult decision is to know when to exit, and how to manage that whole process. We had all sorts come across the threshold in 11 years promising this and that. Most just wanted to take a peek under the bonnet. It’s all very emotionally draining. In the end, it was a cup of coffee, an idea that had merit and then a few more meetings to thrash out the numbers. It was all done inside 6 weeks. If you’d told me 4 months ago I’d be where I am today, I’d have not believed you. Yet now it’s happened, it seems the most natural conclusion in the world. In a few months, I hope to blog about ‘merging portals’, but for now, I have work to do doing just that…

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