Despite the challenges that were faced by property investors last year, Century 21’s chairman Charles Tarbey believes that 2018 will be a great year for the real estate industry—but only for selected people.
According to Charles, there has been up to five years’ worth of real estate cycles that made the business of wealth-creation look so easy—put up an auction banner and wait for people to come and buy the property.
He said: “The agent talks about how much over the reserve they got and everybody's looking at the shiny videos and the shiny cars and the suits and the way in which people dress .... and the way we're presenting the industry, and people are [saying], ‘I want in.’ ”
“I've never seen more auctioneers come into the industry than I have in the last … four or five years. I'd like to see what they're going to look like next year,” the property professional added.
Charles believes that the year 2018 will deliver success mostly to those “who know what they’re doing”.
Instead of being drawn in by the glossy image of real estate, property investors must put their trust on professionals who are dedicated to putting the time in working with buyers and sellers in an auction room—discussing their specific goals and arriving at a mutually-beneficial agreement. That, according to him, is what real estate is all about.
Real estate sees those hardworking people who willingly spend most of their nights establishing relationships be ultimately lead to success.
According to Charles: “Real estate's not what you see on social media … [It’s] people, hardworking people, [who] spend most of their nights seeing people after hours because that's the only time you can see them."
“They're there working with people who are at home with their families while [they’re] not at home with [their] family.
“And the way in which you see real estate occur in the real world is that we will list a significant number of properties but you may not sell half of those properties. So, you'll spend time with a whole lot of people and not get paid a single cent for all of that work,” he shared further.
Reliable property professionals go out of their way to come out and see a property with their clients, provide them with reports, and guide them through their journey in the best way possible. They work hard no matter the market conditions and they always look after their client’s best interest.
Charles said: “When perception meets reality, reality comes off second best. And what people have been seeing about the real estate industry in the last few years is not what our industry is about.”
“It's full of very, very hardworking people who don't get paid for a lot of the things they do … There is a reasonable amount of disruption in this space right now,” he added.
While Charles considers the “glossed up” image of real estate as a disruption, he believes in the potential of technology to help property investors achieve their financial goals.
As Graham Mirabito, former CEO of CoreLogic, said: “You're looking at it the wrong way … It's called constructive evolution. That's not disruption.”
If a product is able to achieve a great result for a client with a lower commission, then it is keeping the industry alive and well. At the end of the day, it’s all about the value added by a good agent rather than the commission.
“If you find the right agent and they can do it for a cheaper price for you and they're going to do the best job, go with them,” Charles advised investors.
Never go with an agent just because it’s saving commission because, in most cases in property investment, you get what you pay for, especially for professional services. A real estate agent’s commission is his incentive, and when they are being paid well to do a job, they are more likely to do the best they could—looking out not just for you, but also for your family and friends.
According to Charles: “If you go into a low-cost agent because it's low-cost commission, they stick up a sign and they charge you upfront, and they put a couple of ads of realestate.com."
“If you think that that's getting you the best possible price, then you're probably going to be a very injured person some time down the track,” he concluded.
Tune in to Charles Tarbey’s episode on The Smart Property Investment Show to know more about his thoughts and concerns on specific property markets and how it will impact investors, how he thinks vacancy and auction rates will change next year, as well as his advice on the best places to buy in 2018, the trends we will see, and the best time to buy.