Network and industry

Housing affordability up for first time since 2021

The REIA’s latest housing affordability report shows that March quarter affordability improved for the first time in three years everywhere but WA (-0.9%), but the number of first home buyers has fallen and rental affordability is still declining.

The good news for buyers is that the proportion of income required to meet average loan repayments fell 1.1 percentage points to 46.6%, with the improvement being attributed to stronger wage growth and a pause on interest rate hikes.

Affordability improvements are most pronounced in NSW where the proportion of income required to meet average loan repayments decreased 2.3%, and least pronounced in SA where there was a marginal improvement of 0.1%. Housing affordability in QLD and the NT remained stable over the quarter.

The bad news for renters continues though. 

The proportion of income required to meet median rents increased 0.4% over the quarter to 24.3%. Rental affordability declined in all states and territories, with declines ranged from 0.6% in TAS and the NT to a marginal 0.1% in VIC.

First home buyers also declined 17.9% over the quarter, but this was actually up 8.3% compared to the same quarter last year.

The Reserve Bank of Australia maintained the official cash rate at 4.35% at last Tuesday’s meeting. The quarterly average standard variable interest rate remains stable at 8.8%. The quarterly average 3-year fixed rate also remains stable at 6.8%.

Fresh start for property managers 

We’re getting excited about seeing all our property managers at the upcoming state-based Property Management Conferences, and we’re very pleased to confirm a change to naming conventions with future conferences and our GEM Awards scheme. 

After consultation with you, we have decided to simplify our terminology for clarity and recognition of our valued property managers. So, our upcoming one-day conferences will therefore be referred to as 'Property Management Conferences' and we will be restoring the original titles in our awards scheme to reflect 'Property Managers' rather than 'Investor Relations Managers'. 

This change is effective immediately and aims to better align with the roles and responsibilities of our professionals.

Protect your profitability

National Performance Manager, Ted Piteo has reminded First National principals that Australia’s year-on-year Consumer Price Index (CPI) has risen 3.6%, placing further pressure on agency profitability.

‘This means business owners have no choice but to think about the impact of persistent inflation, or the cost of doing business, on their business’ says Ted.

‘Insolvencies are at a decade high and although real estate businesses have been spared to some degree, complacency and not considering the financial management review process will, in time, cause financial hardship.’ 

So, what can principals do within their business to respond effectively? 

Ted recommends:

1. Set a budget for the year ahead 
2. Review commissions and fees charged 
3. Cut costs, review general expenses and understand the huge impact ‘cost of sales’ expenses have on their business
4. Cash flow management – avoid the potential for bad debt, look at ways for external resources to carry vendor advertising (not the business)
5. Review all marketing strategies

Take advantage of our National Performance Manager’s services to protect your profitability, today. There’s no fee for talking to Ted. Just make an appointment and, working together, you will identify savings and efficiencies that will improve your business.

Shine a spotlight on your success

The REA Excellence Awards are back, acknowledging those leading the way across the industry. 

There are nine submission-based awards, including Residential Agency of the Year, Property Management Team of the Year, and Game Changer of the Year. 

With over 70 awards, don’t miss your chance to be recognised.

Tens of thousands in net profit improvement

To emphasise the performance boost National Performance Manager, Ted Piteo, can deliver your agency, here’s how a New South Wales member recently identified changes that will deliver tens of thousands in extra profit.

Their business has been trading for many years, operates a rent roll of around 130 properties and makes an average 3 sales per month.

Ted introduced the principal to FN Profit Planner and was able to help identify:

• Loss making practices that could immediately be rectified
• Potential fee improvements
• Strategies to increase income
• Strategies to resolve over staffing in property management and sales

Don't miss out on this unique membership benefit. Contact Ted for a confidential appointment today.

Principals’ business sessions receive praise

Throughout 2024, First National’s ‘Business Sessions’ for principals in Melbourne, Echuca, Sydney, Adelaide, Brisbane and Townsville have received unanimously positive feedback. 

They’ve enabled owners of different sized agencies to reveal and discuss the challenges they face as well as compare the solutions other principals that have been successful in their agencies. 

Our recent Business Session in Perth was no different, so principals can look forward to repeat Business Sessions in our capital cities before the end of the year, and in a range of different regional areas.

‘Thank you very much for hosting the session last Friday.  I must admit that initially I debated whether to attend!  However, I am pleased that I did.  When you have been in real estate as long as me,  it is easy to assume that you know it all… very much the wrong attitude. The topics discussed were exceptionally useful and Scott and I had either confirmation that we were on the right track, or we were introduced to different answers to thorny questions.  For example, it is important to know what pay structures are within the industry and the open exchange of information was great, as was the acknowledgment of individual concerns regarding the management and structure of our respective businesses. As our businesses are of differing sizes, and can operate in very dissimilar markets, it is comforting to know that we all face uncertainty and confusion at times and that voicing our insecurities is not failure, but a step in going forward with confidence. A very worthwhile, informative, and enjoyable day, spent with great people in a pleasant environment.’

Morag Lowe

FN Hedland (Port Hedland, WA)

‘Given the closed nature of the session, it was great to see various business owners / managers being vulnerable with information and operations. As always, Deb Fletcher was on-point, reading the room and provided valuable insight to engine room of property management and sales. Seriously a worthwhile session!’

Andrew Sherwood 

FN Karratha

‘Was well worth the 900km round trip for this event. Well run and very organized. Great to hear from other agencies as to their strengths, challenges, wages, commission structures to day to day running of their agencies - to compare how we are going in our first year!

David Kerr 

FN Bairstow Kerr (Albany, WA)

Rental Taskforce to ‘crack down on dodgy agents’

Two matters of particular note to NSW principals that should be on your office’s management agenda.

Firstly, the NSW Government’s budget includes an $8.4 million allocation for a ‘Rental Taskforce’ that will conduct targeted inspections, working through Fair Trading, to act on breaches of rental laws and sub-standard rental properties. Make sure your team is familiar with the minimum standards as well as the ban on rent bidding. We recommend each office role plays what property managers can and cannot say.

• Use words in your rental advertisements such as ‘offers from’, ‘by negotiation’, ‘contact agent’ or ‘price available soon’
• Solicit or invite an offer of rent higher than the advertised price

All NSW rental property advertisements must carry a fixed price. Prospective tenants are able to offer higher rents for a rental premises if they do so voluntarily and freely, but DO NOT HINT that this would be a good idea.

If a tenant asks you if they should offer a higher rent, or what other applicants have offered, you can say:

‘I am not permitted to invite you to offer more than the asking price. You must make your own decision about what rent you wish to offer.’

If you are asked ‘can I offer you $100 above the asking price?’, you can say:

‘Yes, you can. I will let the landlord know.’

If you are asked ‘If I offered more rent, would I have a better chance of securing the property?’, you can say:

‘I am not permitted to invite you to offer more than the asking price. You must make your own decision about what rent you wish to offer.’

Secondly, the new Supervision Guidelines come into force on 1 July 2024. This aligns with the start of the new continuing professional development (CPD) year which will run from 1 July 2024 until 30 June 2025. Two free online sessions will explain the changes to Supervision Guidelines and CPD, and there will be an opportunity for questions.

RTA changes SA agents need to know

The Real Estate Institute of South Australia (REISA) recently hosted training on the changes to the RTA that all property managers need to be familiar with. 

South Australian Business Growth Manager, Trent Godfrey, attended on behalf of First National members who were unable and has made the PowerPoint that was presented by REISA available.

Last Friday, Brett Wheatland (The PM Consultant) helped our SA/NT Property Managers get on the front foot around the upcoming SA RTA changes, with a great unpack session.

They also heard from special guest Phillip Moss (SA Police) on the topic of personal safety, learning helpful insights into safety.

Systematic selling

Melbourne’s sales agents gathered at Crown for a day of training on the systems that Jonathan Clover (FN Genesis, WA) uses in his business to produce award-winning results.

The network extends its thanks to Jonathan for sharing his expertise and up-skilling both sales agents and principals throughout First National.

‘Jonathan was a great presenter; very knowledgeable and obviously results driven. The session content was exceptional and spoke to the BDMs as well as the sales professionals in the room. His awareness of buyer mentality and how that plays a part in the sales process was very interesting.’

Allison Holzer 

FN Neilson Partners (Narre Warren, VIC)

‘It was great to discuss processes and strategies with a director/agent that has implemented and currently uses these processes to successfully build their business.’

Natarsha Sewell 

FN Bonnici & Associates (Wodonga, VIC)

Upcoming education opportunities

What: Property Management Training with Hayley Mitchell

When: 16 July 10:00 am to 3:00 pm AEST

Where: Crown Melbourne 

Register: Click here

What: QCAT Training Webinar with Trish Rogers 

When: 16 July 9:30 am to 11:00 am AEST

Where: Zoom Webinar - Online 

Register: Click here

What: Property Management - NCAT Refresher Webinar with Trish Rogers

When: 18 July 9:30 am to 10:30 am AEST

Where: Zoom Webinar - Online 

Register: Click here

What: Sales Training with Kylie Walsh

When: 30 July 9:30 am to 1:30 pm AEST

Where: PARKROYAL Parramatta, Sydney 

Register: Click here

Upcoming August dates

Wollongong | 1 August

Ballina | 13 August 

Newcastle | 20 August