RE/MAX Conference 2011 - what we have learned

Adrian Goslett, CEO of RE/MAX of Southern Africa, said that the group has consistently grown its market share each month and continues to attract quality agents into its fold. In fact, the average real estate experience of each of the agents recruited by RE/MAX so far in 2011 is in excess of seven years compared to the industry average experience of less than three years.  Furthermore, 16 new franchises were sold throughout the country between January and July this year.

When it comes to real estate sales, Goslett reports a month-on-month growth of 21% for the first seven months of the year, which is the highest turnover achieved since 2007. This number comes on the back of a growth of 35% recorded in 2010. April, May and July were the best months recorded so far this year for RE/MAX of Southern Africa, with Gauteng’s figures for the year-to-date topping those achieved during the same periods at the height of the real estate boom in 2007.

Mortgage finance figures are looking more positive according to Rudi Botha, CEO of Betterbond, one of the conference sponsors. Botha noted during his presentation that in April 2009 the bank approval rate for home loans was 26%. This figure has now improved to 45%, however, it is still a lot less than the 80% approval rate achieved at the height of the real estate boom in 2007.

Deposits however are still very much a reality for homebuyers, and will be for the foreseeable future. Botha said that the majority of approved home loans required deposits, with 27% granted at a 95% loan-to-value ratio, and 32% granted at a loan-to-value between 85% and 90%.

Botha’s figures also showed that 37% of property purchasers were aged between 30 and 40 years; were from the middle income segment and purchased homes for an average value of R848 680.  “This indicates that the middle sector of the market is still growing,” he said.

Other guest speakers at the conference included Canadian Christopher Invidiata from RE/MAX Aboutowne Realty based in Oakville, who spoke about trust being the best business strategy for real estate agents today, despite economic conditions. “People will remember the emotional experience over the product,” he says, “and people have a natural need to be in relationship, so make clients your friends. People will always be loyal to people.”

Key note speaker Steve Murray, Editor of Real Trends, a trends research and publishing firm based in Castle Rock, Colorado, spoke extensively on mergers and acquisitions, and how real estate businesses are valuated. Murray’s areas of speciality lie in valuations, mergers and acquisitions among residential brokerage companies as well as brokerage analytics on profit and loss, brokerage metrics, commission plan analysis and other areas of brokerage performance.

Goslett attributes the success of the RE/MAX brand in Southern Africa and the success its agents have enjoyed to the group’s comprehensive training programmes that aim to equip its real estate professionals with the correct tools for the current market.  “One of the key messages that came across in this conference was that successful real estate brokerages are founded on recruitment, development and the retention of competent, qualified real estate professionals,” Goslett concluded.

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