13 Jul Trust me – I am a banker! + The risk of DIY home styling + SMSF and property – the facts
Highlights from this week:
- Don’t overlook a mid-year partial claim
- Setting up a property in a SMSF
- Sellers and agents disagree about auction
- Is DIY home styling worth the risk?
- Trust me – I am a banker!
Don’t overlook a mid-year partial claim – Brad Beer
Kevin: A couple of weeks ago, I spoke to brad Beer from BMT Tax Depreciation about the timing of tax depreciation schedules. He joins me once again.
Good day, Brad. How are you doing?
Brad: Great, Kevin. Great to be here as always.
Kevin: Thanks, mate. When an investor purchases a new property, it’s rare that they’re going to own that property for a full 12-month period before tax time comes around again – and we’re just starting a new tax year now. As a result, many investors who have only owned a property for a short period of time will assume it’s not really worthwhile ordering their depreciation schedule until the following financial year.
Are there still significant deductions an investor can take advantage of even for a partial-year claim, Brad?
Brad: Kevin, the answer is yes. The reason for that is if you do buy something… We don’t just go and buy properties and settle on the first of July, do we?
Kevin: No, we don’t.
Brad: Well, some people do but you don’t look for properties in order to do that.
How depreciation kind of works is that if you owned it for half of the year, things get kind of pro-rated – well, some things do – and you kind of get half of that deduction in the first year.
But because of some of the tax rules – they like to make intricate ways to make them not so easy – some things get a claim that’s the same regardless of whether you owned it for 2 weeks or 50 weeks, and so when you get it in the first year, it’s not like if I was to settle on the 1st of June, some things still get a substantial percentage of the deduction straight away or in the early year that aren’t sort of meaning it’s not going to get any deductions in that first year.
So, it’s always worth not waiting because if you do want to go back and get that deduction in a future year, then you’d have to actually amend a tax return, which if there’s a lot of money there to do that, it’s worth amending a tax return, but if you have the number already and you have the deductions already, you might as well put them in a tax return in that year and not necessarily wait for the future.
Kevin: Good point. I wonder if you’d explain for me immediate write-off and low value pooling. What’s that about?
Brad: Those are the two things that allow deductions in the first year to be a bit quicker. With a lot of things, as we said, if you owned it for half the year, you get half the deductions. But immediate write-off is that anything that you buy that has a cost of less than $300, regardless of 1 day or 364 days of ownership, it’s an instant deduction in that financial year.
So, when you buy right near the end of the financial year, all of the things that are worth less than $300 instantly get to get written off in that year. Things like smoke alarms, door closers, garbage bins, sometimes garage door controllers, and things like that get a quick claim in that first year.
Now, the second thing we mentioned there is around low value and low cost pooling, sort of the same thing somewhat. What this is is any item that’s worth less than $1000 gets to be claimed at 18.75% in the first year and then 37.5% in the following years.
Now, a lot of items get claimed at 10%, 20% and they do get pro-rated under the normal type of depreciation, but there’s no pro rata on this 18.75% in the first year. So if you had something and you bought and sold this property right in the last week of June and you had it available for rental and producing income, a $1000 item gets $187 for a few days. And if there’s a few of those in that property with no pro rata adjustment, this is how those adjustments really add up in that first financial year as a part-financial year sometimes.
Kevin: Gee, it’s a complex thing. Brad, I wonder if you could just provide us with an example scenario of the deductions an investor could claim for a partial-year period of ownership. Give me an example, say, towards the end of the financial year before the financial year comes around.
Brad: I took a live example here and looked at a house that an investor has bought and they’ve settled it with only 29 days of the financial year left, on the 2nd of June. It was a new house that they bought for a purchase price of $550,000.
Now, as I said, there’s these immediate write-off items that they can claim, things like the garbage bins and bathroom accessories, smoke alarms. We found a few of those, and there was a $1288 claim against those items initially that were claimed at 100% in the first year.
Then we have these low value pooled items, items worth less than $1000. We have in there range hood, blinds, cook tops, and these things, even though it’s only that small amount in the year, we were able to claim $2274 only in that 29 days of ownership.
Now, after that, you also have this claim on the building. Now it does get pro-rated in the first year. So, we have some Division 43, or that building component, and some dollars for the items that do get pro-rated outside of these ones that get claimed quicker. And we’ve actually got a total deduction for 29 days of about $4852 in that first financial year.
Now, from the 2nd of June, you only have a very small amount of rent because you’ve only had it for four weeks, so that’s an instant deduction that’ll come off the other income that you have that’ll mean some good cash in only 29 days of ownership.
Kevin: Wow, it’s certainly not to be sneezed at, $4000. That would be a nice mid-year gift, wouldn’t it?
Brad: It would be. It’s always worth assessing straight away in that year rather than waiting because I like $4,852 in deductions wherever I can get it.
Kevin: There you go. That’s another thing you might not be aware. Brad Beer from BMT Tax Depreciation.
Brad, thanks again for your time.
Brad: Thanks, Kevin. Always great to be here.
Setting up a property in a SMSF – Ian Rodrigues
Kevin: A few days ago, we released a video on the Your Investment Property channel. It’s a video that I did with Ian Rodrigues from Bishop Collins in our continuing series as we look at self-managed superannuation funds.
There are a lot of facts that you need to get on top of if you’re looking at doing this for yourself, so I wanted Ian to come and join us in the show just to talk a little bit more about that, and maybe point you towards that video. So, go to the Your Investment Property channel website on Real Estate Talk and you’ll see that video there. It goes into a lot of detail. And by the way too, we give you a download opportunity to get a lot of these facts for yourself.
Ian, thanks again for your time. I wanted to have you in the show just to give that a little bit more exposure, because I think there are some key points we need to cover that will help people understand whether or not putting property in a self-managed superannuation fund is for them, because as you pointed out in the video, it’s not for everyone, is it?
Ian: Definitely not, Kevin. There are a lot of these funds around. There are around 600,000 of them in the country in the moment, constituting over 30% of all superannuation money. Those are enormous numbers, and it’s been growth year on year that’s been coming there. But I am adamant that they’re not for everyone.
Kevin: No, they’re not. And that’s evidenced too by one of the stats that we give you in that video, and that is that about 11,000 to 12,000 funds are actually wound up every year. And I think you said that that’s probably the result of people realizing this is not for them.
Ian: Yes. In my experience, some of those funds in theory could be people getting to the point that the members have died and the funds are wound up – there would be an element of that, but in our experience, there are a lot of people who have set these funds up, they’ve jumped on the trend, everyone’s got one, maybe they’re keeping up with the Joneses, and when you look at it, you think “Well, why do you even have this? You don’t have enough money in it, you don’t really want to make decisions about where to invest the money, and it’s not big enough to really justify the cost of running it.”
Kevin: The cost of running it and also the cost of setting it up. So, if you do set one up, it’s not easy, it takes time, but it also takes money, and then if you wind it up in a year or two, you really have lost a fair bit of money, Ian.
Ian: Absolutely. And I think the danger with these things is that people haven’t thought through before they do it what’s involved in running it. It can be easy for the member because it’s easy to make your accountant or financial planner set it up for you. You just write them a check and fill in some forms and away you go, you’ve got the keys. But they are complicated.
There are a lot of obligations, and your advisors should be looking after all of those for you, but it does mean cost, and the cost is really great when the fund is big enough, but the cost is very fixed. So, when the fund is small, it can be quite a big number.
Kevin: Yes. How big are the funds generally? What’s the average size?
Ian: There are funds ranging everywhere, but the average size of a fund is over $1 million now. And the typical member is in their 40s, so they’re still in the accumulation phase. This is a massive growing part of the market. There are funds that are still in growth phase. There are net new funds every year of around 20,000 or 25,000 funds – net of closedowns.
We’ll be looking at this in another five years and it won’t be 30% of super money; I’d suggest it may be a lot more than that again.
Kevin: We’ll do a “word to text” of this interview, so just scroll down, and I’ll make sure that our producer puts a link to that video, because in the video, we offer you the opportunity to download a whole lot of material about this so that you can become more educated yourself before you can go and see your own accountant about whether or not you should do this.
All of that comes, of course, from Bishop Collins. They’ve actually supplied that to us. A lot of the information came from the ATO I believe, Ian. Is that right?
Ian: That is correct. The ATO put out some great numbers, and for people who like the numbers, there’s a lot of data in there to digest. For the accountants, we love it, we look at it every year, but it does tell you a lot about funds. They have some good guide books if you’re an aspiring trustee, and if you are a trustee, you’d probably read them and give yourself a sleepless night.
But it isn’t that bad. The point I make is it is complicated, it is difficult, there are lots of rules, but that’s not for the members to worry about. They just need to know the most important stuff to not do, and their advisors need to look after the rest.
The biggest concern the ATO have with these funds is people taking their money out of it before retirement age, so basically lending money to themselves. That happens on a small scale relative to the size of the market, but it is the major concern the ATO has.
Kevin: Okay. An opportunity, once again, go to that link, watch that video that I did with Ian. A lot of information inside the video. It runs for about 10 or 12 minutes. But also opportunities to download some links and get a lot more information for yourself.
Ian Rodrigues has been my guest from Bishop Collins. Ian, once again, thanks for your time.
Ian: No problem, Kevin. Our pleasure.
Sellers and agents disagree about auction – Justin Nickerson
Kevin: Interesting that a survey of Sydney and Melbourne real estate agents, which was conducted by Gavel, who we had on the show for you last week – they’re a live real estate auction streaming and bidding technology company; they commissioned the survey – and among those, 100% of agents in Sydney believe that properties get the best result at auction compared to 87% out of Melbourne.
I want to talk to Gavel’s spokesperson on this, Justin Nickerson. Justin is well heeled to be able to talk to us about this. He is the Australasian Auctioneer of the Year, sold more than 5000 properties at auction.
Justin, thanks again for your time.
Justin: My pleasure, Kevin.
Kevin: I want to have a talk to you about this, not necessarily supporting the survey, but just highlighting a couple of issues. I was at a function recently amongst a group of prospective sellers who were questioning whether or not they believe in auction because so many buyers will dismiss an auction simply because it doesn’t carry a price range or a price indication, Justin.
Justin: Yes, that gets raised a lot. We do a lot of training with agents around this, and that’s a real fear in an agent’s mind as well, that vendors or buyers have passed onto them.
We always say to ask the question if that is the case to that person and say “Firstly, are you actually looking at the market right now as a prospective buyer, or are you looking at the market as a seller or potentially a researcher?” because I think you look at it differently.
If you’re a seller or a researcher and it hasn’t got a price, you’re not that engaged in it, so you’re very easy to flip past it. But if a property comes up and it suits your exact wish list, that it has to have four bedrooms, has to have a pool, has to have at least a 600 square meter block, and it’s in the exact location that you want to buy a property, and it comes up without a price, it’s a pretty thick-skinned person who is going to dismiss that just because it has no price.
What most people will do, we believe, is they’ll send an e-mail to the agent saying “Give me a price,” or “Give me a price guide” and then it’s up to the agent to have the skill to be able to transfer that inquiry to give that buyer enough meaningful information that they come through the property.
If they’re really stubborn and say, “We definitely wouldn’t inquire if there’s no price there,” that’s okay because the way that auction works anyway is there is usually three stages to it. There’s pre-auction, there’s on the day, but then there’s post-auction which means if that buyer is still in the marketplace at that time, then the seller is actually going to reach out to that buyer at that point because they’re going to put a price on the property. And that price will be set by the market rather than by the seller and the agent, which is what traditionally happens on the first day of a listing.
Kevin: With any property, you can only ever sell it once, so in theory, you really only need one buyer. Yet in an auction, to get a premium price, you do need at least two engaged bidders, don’t you?
Justin: It’s definitely preferable to have two. We always said the two key ingredients to get you the best possible price are an emotional buyer and then placing them in a competitive environment.
I think that private treaty has competition in that it’s perceived competition. If it’s a multiple offer situation, you have to sit down and you have to anticipate what the other person is going to be doing and then you react accordingly.
Auction definitely exists to add competition, but also, auction works with a deadline. So, what you can actually use, even if you have one buyer, is the fact that you have got a looming deadline there that this is the day the seller wants to sell their property and if it doesn’t sell today, then we are opening the door to people post-auction who can come in with terms and conditions.
So, you also have that perceived competition element there even if you just have the one buyer, which is pretty common, actually, at the moment, with a a lot of auctions. Particularly around the South East Queensland market, we get very used to negotiating with one buyer on the day.
Kevin: A couple of tips from Gavel in the release about giving sellers peace of mind about going to auction. The five points they make are choose an agent with a good track record, choose a realistic reserve price or an expectation, ensure there’s good marketing, ask your agent to invite off-site bidders, and have a strong open home strategy.
I would put to you that with exception of maybe number four – which is off-site bidders – all of those can also be applied to sale by private treaty. You definitely need a marketing budget. Would you agree with that?
Justin: Yes, absolutely. I think Gavel is spot on in their research and the five tips they’ve put out there because it all ties back to that first one, Kevin. I think if you choose an agent with a really good track record, they’re going to give you enough information so that you can set a realistic reserve price, they’re going to run an equity marketing campaign, and they’re going to have a strong open home strategy.
I think, actually, that first decision that the seller has to make is sometimes a bit of a funny one because sometimes they choose it based upon price or based upon who’s going to do the marketing for free or timing. But really, if you really want to make sure you nail your campaign, you have to choose a strong agent.
We’re an independent auctioning company, so we freelance out, as do Gavel. Being independent, they work with a number of different brands, and we see the difference between agents that do this job really well and agents that just do it to a mediocre level. I think that’s the most critical we’re seeing. If the sellers make that decision correctly in the first place, all those other things fall into line behind it.
Kevin: Many sellers will tell me that there’s a certain amount of uncertainty with an auction. I think even Gavel pointed out in their release it’s high-risk, high-reward stakes. But also, the fact that there’s a concept that auction costs more to sell, and that’s mainly because auction requires a level of marketing that in some cases, private treaty doesn’t.
Justin: I’m going to take the contrary view with you here, Kevin. I actually think that auctioning campaigns and private treaty campaigns should cost exactly the same amount of money. I don’t understand why… Your goal in both of them is to get as many people interested as you can and present the property in the best possible light. Why would one method of sale require you to do more? You want both of those things on both private treaty and auction.
Obviously, the difference you get is an auctioneer’s fee and other than getting a charming professional at the top of their game, Kevin, as you and I both know, with the auctioneers, the role they play is that of paid negotiator. So, that’s really where that extra cost should come in.
But outside of that, I actually think that auction campaigns and private treaty campaigns should cost exactly the same, because I think you’re trying to do the same things irrespective of what the method of sale might be.
Kevin: Week after week, we look at auction results in our weekly program with Dr. Andrew Wilson, which is called The Auction Insider, and week after week, we see the auction numbers in Brisbane, say, compared to Sydney and Melbourne, lagging way, way behind. Is that agent-driven, or is that the fact that people in certain parts of Australia are not comfortable with the auction concept?
Justin: I think in that Gavel research that you quoted before, it’s interesting that just 17% of Brisbane respondents believe properties sell best at auction. That’s the people who the agents are going in to talk to. So, I think in a lot of cases, what happens is the agent goes in there and they get met with some resistance around auction or “Don’t talk about auction, we’re not interested in auction,” and obviously, the default position for every agent is “I just want to get the listing” because if they don’t get the listing, they don’t get paid, and that’s why everyone does the job that they do.
So, I think that it’s actually driven predominantly by sellers and buyers, and then agents carry that out of an obligation of not wanting to upset them but still wanting to win the business.
I think what you find is the stronger agents or the agents who really believe in what they do, they’ll go in there with a plan and say “I understand you might feel like this, but let’s actually talk about the reasons why you feel like that. Let me try and answer that, and then you can make a balanced decision across both of them rather than based in your fear or you’re not liking auctions out of an isolated particular incident that might have happened 10 or 15 years ago with an agent who isn’t me.”
Kevin: Yes, it requires a lot of skill and belief from the agent to be able to sell that proposition, which is what you’re talking about. I’ve even seen in some situations in a soft auction market, you’ll find that one office in particular is very strong with auctions. I know this is a national show, but let’s look at the Brisbane market for the moment. There are some offices that are almost totally driven on auction and others that are simply not in the same marketplace.
Justin: Yes. It’s an interesting study. It comes from the top down, so it’s usually led by a principal or the sales manager who has that attitude. But one thing we’ve always subscribed to is the theory that whatever area you’re in, whatever suburb, whatever town that you’re in, whoever the dominant agent is in that area, what the attitude is towards the vendor-paid marketing in particular, open homes, method of sales – so auction or private treaty – that’s generally what dictates to the rest of the town, because they actually influence more sellers and more buyers than anybody else.
So, if their attitude is very pro-auction, the town actually then, by proxy, becomes pro-auction because they become more exposed to it. So, you actually can trace it back in a lot of cases, to whoever has the dominant market share in an area.
But it is always an interesting study, and we always think that the best businesses that we deal with have a balance, so they have a strong auction element but they also have a strong private treaty element, because if you put all your marbles to one side and you go all-in on one method of sale, the problem is when you go into a listing presentation and you meet a seller who doesn’t want that – they want the other side – you’re either going to be pigeon-holed as someone who doesn’t do it or you’re not going to have the requisite skill and they’re going to go to someone who does. So, I always think that one is a good thing for agents to strive towards.
Kevin: Wonderful talking to you, Justin Nickerson. Justin, well-qualified to talk on this subject, of course, as I said at the opening, is the Australasian Auctioneer of the Year. Good talking to you, Justin Nickerson. Thanks for your time, mate.
Justin: A pleasure, Kevin.
Is DIY home styling worth the risk? – Melanie Grace
Kevin: More and more, we’re seeing television shows that are focused very much on improving a property, flipping it, turning it over, selling it. There’s just so much information available in some of these shows. And one thing you will notice is that more and more, we’re finding that styling, decoration is a key factor in moving these on to become successful.
So, how does that relate to you as a buyer and/or seller of property, not necessarily a TV show? I’m talking now to Melanie Grace who runs Grace and Co. They are property styling experts.
Mel, thanks very much for your time.
Melanie: You’re welcome, Kevin.
Kevin: Now, I know you’re very experienced in this field, you’ve been doing it for a long time, you have a lot of really good clients who are getting great satisfaction. I want to find out some real values here. But where do you see DIY decoration going wrong? Have we gone past the DIY? Has it got to be a lot more professional nowadays?
Melanie: The DIY, as you said, to do with the TV shows, there’s a lot of DIY decoration going on. However, there’s a lot of wrong DIY decoration going on. As a stylist, things that really go wrong, things like colored feature walls, the old red, yellow, purple color pops really don’t work for buyers. Things like buying every item of furniture in a matching set throughout the house is definitely one that is a no-go for styling when you’re selling your property. And then, of course, the big one is the Kmart effect.
Kevin: What is the Kmart effect?
Melanie: Kmart as we all know is a very big company, and they have brought a lot of home décor market onto the market at a very cheap price. But it’s not just pops of Kmart; it’s the whole house.
Kevin: Yes, it gets back to what you said earlier about just decorating in the one style throughout the house. Is it more about styling into zones so that the zone is very much about what’s going to happen in that area?
Melanie: It is. And also, the way we style our homes is very different when we’re selling them versus the way we style a home that we want to live in. You need to make an emotional connection with a buyer when they walk through the door. You have eight seconds to make that emotional connection when the buyer says “I need to live here, I want to live here.” And that’s what property styling is all about. It’s not about styling your home to how you would like to live in it.
Kevin: I guess it comes down to whether you’re styling it for a person who’s living there now or styling it for a future buyer. You have to understand what their motivations are, I guess, and then particularly if you’re looking at selling a property, it’s understanding what buyer is going to be attracted to it and how you decorate the home to suit that buyer, not necessarily the people who are living in it now.
Melanie: Very much so. And any good real estate agent worth their money will be able to tell their seller who their market is and what their market is looking for.
Kevin: What turns buyers off?
Melanie: Pretty much what turns us all off: dirty, unclean houses, closed windows, no light, bad smells. The first thing you have to do is get a buyer into the property, and the way that you get a buyer into the property is through good photography. Good photography is reflected in good styling. You have to have something good to photograph.
Kevin: Yes, that’s really the window display nowadays, isn’t it, the Internet? Can you give me some practical examples of how getting a professional in… And one of the points I’d like to make about this too is if you’re looking at selling, we all love our home, we all live the environment we live in, and we sometimes think “Well, if that’s good enough for me, it’s good enough for a buyer.” But it needs to have a professional look.
Can you give me an example of how you’ve come into a property, you’ve styled it up, and you’ve achieved a much better result than anyone thought?
Melanie: Back in 2017. It was a waterfront property. This house had great potential, it had boat access, it was a big block of land, however, the property had been let go due to personal issues with the owner. We were hired to step in and help, but it didn’t turn out to just be a styling job. It was a six-week job of preparing the house for sale, which included hiring trades, hiring painters, hiring landscape gardeners. I was doing things like going to Bunnings and picking up plants and range hoods. Everything was fixed up in the property.
The agent we worked with on this property had told the owner if they were not to put money into preparing the property for sale – which is just as important as styling – and styling the property, they would be looking at around $880,000 as a sale price as was. After six weeks and after we came in and styled it, the property sold for $1.14 million.
Kevin: How much did it cost to do the styling?
Melanie: The actual styling itself was around $7500. It was a fairly big property. We have a saying in our business that cheap property styling isn’t good and good property styling isn’t cheap.
Kevin: The figure you mentioned there seems to me to be extremely low. Was that everything? Was that purchasing or was that hiring of furniture?
Melanie: That’s purchasing the furniture, Kevin. The way that we come into a client generally is that we go into the property, it may be vacant or the client may still be living in the property while it’s up for sale, which is what we call a partial styling where they keep their beds in the property and some furniture items. So, this property was actually fully vacant.
So, we give a general guide. Probably one of the biggest questions I get asked every day by clients is “How much?” Over the phone. And of course, I can’t quote over the phone on a property that I haven’t seen. Every room is different, every property needs individual styling, so as a general guide, we say to people they should expect anywhere between 0.75% to 1.5% of the property value.
Kevin: That’s a really good guide. Melanie Grace is from Grace and Co. Property Styling. So many more things I wanted to ask you, but we are out of time. So, thanks very much for your time, Mel.
Melanie: You’re very welcome.
Trust me – I am a banker! – Veronica Morgan
Kevin: Well, if nothing else, one thing that the Banking Royal Commission has told us is that even those who we thought we could trust, we probably can’t. This relates very much to what we’re hearing, some of the evidence that’s been quite staggering that’s coming out of the Royal Commission.
It raises the question: how can you trust banks? How can you trust anyone in property? I’m going to discuss that now with Veronica Morgan. Veronica is a buyer’s agent, she’s from GoodDeeds.com.au, and is also a cohost of Location, Location, Location Australia with Bryce Holdaway.
Veronica, nice to have you on the show again.
Veronica: Hello, Kevin. Nice to be here.
Kevin: Yes, a sensitive subject, this one, about trusting the banks or even trusting anyone. It’s really very concerning.
Veronica: It’s shocking, actually. When you hear the Royal Commission, some of the stories that have been coming up, it’s absolutely mortifying. And it’s interesting that there are a lot of parallels, though, with what’s being talked about and the things that have been revealed, there are a lot of parallels with the property market and the property industry.
And in particular, the investment space and the property spruikers and the muddiness around what’s an advisor when it comes to investment property. I see a lot of parallels between the bank-employed financial planners and – using inverted commas here – “advice” that they’ve been giving and property spruikers or marketers and investment specialists who are actually pushing product.
Kevin: It’s been staggering to listen to some of the people whose lives were just totally wrecked. And it’s not just the banks; there have been some brokers and some investment advisors who have done some very shonky things.
Veronica: Yes, they have. In fact, obviously, the mortgage brokers are being to some degree, I think, thrown under the bus by the banks as well and are being blamed, where there are a lot of very good brokers out there, a lot of very good financial planners out there as well.
And I think that hopefully at the end of all this, it will be possible for consumers to easily distinguish between the two. And I think the idea of independence is very important, and I think that needs to come out loud and clear. But there are unfortunately some unscrupulous people who are always going to prey on the desire of some people to get rich quick, false promises.
Kevin: They are in every industry. And it’s not just the banks and it’s not just the brokers; there are lots of people who shouldn’t be there. But I think the companies who are taking this seriously, Veronica… And I had a meeting just today with someone who heads up a very large brokerage firm in Australia, and they are treating this extremely seriously, so much so that they’ve been terminating some of their agreements – and they have been for quite some time – if they found that everything’s not going the way that it should be.
Veronica: Which is great. I think it has to be hit hard. It’s funny; on the real estate side of things, there’s a Pathway to Professionalism Initiative that has been gathering momentum. It’s been spearheaded now by the REIA. And what’s behind that is really turning the idea of being a real estate agent into a profession.
I’ve been talking to some of the people involved in that and in their surveys of agents across the country – and I’m sure it’s very similar to brokers and financial planners – is that there’s a massive, wide gap between those who are really great practitioners and those who aren’t, but also just a lack of general training and mentoring, education across the board.
And as a real estate agent, we’re behind the financial services sector, which is even more scary.
Kevin: You mean in terms of credibility?
Veronica: Well, (a) in terms of credibility, but (b) in terms of actual education standards.
Kevin: I see what you mean, yes. Well, I know that John Cunningham… I don’t know whether he’s the person you’ve been talking to.
Veronica: He’s one of them, yes.
Kevin: John has been very strong… John is a wonderful real estate agent. He has his own business, Cunningham’s Real Estate. And John has really been pushing very hard for this, understanding that the credibility of how they train agents to be credible is just so important to keeping the industry alive.
Veronica: Yes. I think I mentioned when I’ve spoke to you before, I’ve just launched a new podcast recently called The Elephant in the Room, and we’ve been interviewing people like John. We’ve interviewed a number of agents – Shannon Whitney is one we’ve interviewed as well – where we’ve really dug into this whole idea of professionalism and why it is that the real estate industry has such a terrible reputation and what needs to change and the attitudinal changes, but also the whole standards of the industry and how success is measured, all of those things.
There are a lot of excellent agents out there who really do the right thing, and I think John Cunningham is one of those people who is a beacon in the industry, but there’s a lot to be done.
Kevin: There is. But thank goodness there are people doing it, and thank goodness too for the Banking Royal Commission, because it has unearthed lots of things that we were not aware of that no doubt are going to be fixed, and I think all of that is great stuff.
Veronica, thank you so much for your time. Wonderful insight. Veronica is from GoodDeeds.com.au. Thanks for your time.
Veronica: My pleasure.