Which side of the coming price war is your business on?

Contributed By: Nick Buick on

There are big changes coming to the letting industry in the coming months. Shortly, your owners and investors will be able to, VERY CHEAPLY, source their own tenants directly from RealEstate.com.au – no longer will they need to concern themselves with the excesses of a letting manager. This may be the most important article you read all year. So grab a coffee and settle in.

“Good work ain’t cheap, cheap work ain’t good”
-Sailor Jerry

But first, a preface: When I started this agency 15 years ago to help onsite managers advertise online, the greatest obstacle I faced was convincing onsite managers that they actually needed to advertise online. Everyone I spoke to had the same answer: “Why should I bother with online? I have a perfectly good sign out front!”. Maybe, at that point, a sign on the street was sufficient. The sign was cheaper, and it worked, right? Until quite suddenly the sign stopped working. Investors began rapidly switching their management to outside agents with a superior quality marketing service offering than a shonky sign. This, more than any of my arguments, convinced managers to embrace online marketing.

Since then, a dozen companies have copied my idea. Some do a reasonably good job, and have worked along side us quite happily for many years. Imitation is the highest form of flattery, after all. Others have done… well… not so great of a job… engaging in illegal harvesting activities, making outrageously false claims, offering shonky stripped-down service and limited support. Today it feels like even the local paper-boy has built himself a cheap imitation of our website and is touting it as ‘the greatest’ or ‘the leading’ or (to use a tongue-in-cheek adage from my formative days when I worked in advertising and we had to sell something particularly small and indifferent): ‘the fastest growing’ portal… and their subtext is clear “We’re cheaper than TheOnsiteManager” Imitation is flattery, but a cheap imitation isn’t flattering: it’s a fake Rolex that falls apart without warning, embarrassing its wearer at a critical moment. And friends: That critical moment is about to be upon us. 

At $1.35 per day, our service is in no way expensive, We provide each manager with over fifty thousand dollars per year of mission critical services, vital for a letting business, for $495 a year… We allow our managers to compete (VERY strongly, I might add) with outside agents. But if you look under enough rocks, you’ll eventually find folks offering what they pass-off as *ahem* ‘a similar service’ for slightly less money, and it’s frustrating when my managers come to me, regurgitating the laughable comparisons between the ‘cheap’ offering they’ve seen, and what we offer. Who cares if it’s missing a large chunk of features, it’s cheap and it works, right? Just like “the sign”. It works great, until it stops working. After all, why ‘waste’ money offering more when you can get away with doing the bare minimum? Currently investors must pay a licensed manager to put their listing on Realestate.com.au because they cannot access RealEstate.com.au themselves. Additional features and services are just “superfluous luxuries”.

In a few months, though, that all changes. Investors will be directly invited to market their own rentals on RealEstate.com.au, themselves, without the need of a licensed manager. For a fraction of the price managers currently charge investors in relet fees (The price REA reps told me was just $100), investors will now directly source their own tenant from RealEstate.com.au as easily as sourcing a buyer for their used car on Carsales.com.au. Just ask a used car salesman what that website did to their industry, if you can still find one. 

To prosper in this coming paradigm, managers will need to sharpen their pencils! They will need to offer the compelling argument that quality management calls for more than just placing basic ads on RealEstate.com.au and returning the occasional phone call. Managers need to promise, and to deliver, an end-to-end letting process to investors that will drive results; and they’ll need to educate investors on the importance of an onsite manager employing this process. The good news is, it isn’t hard to do, if you partner with the right agency that has 15 years of experience, at the top of this game, doing exactly that.

From day one, I have refused to compromise quality of service over price. Here’s the key points I believe managers must offer and emphasise in order to compete with their own investors and retain their business:

  • Prompt, Personalized, and Professional Service
  • Superior Lead Generation and Management Process
  • Exceptional Online Presentation
  • A Complete End-to-End Marketing/Management Solution

It is literally impossible to deliver the above items, while partnered with an agency who offer the bare-bones minimum in online marketing and nothing more. When it comes to marketing services, now is the time to go big, or go home!

Prompt, Personalized, and Professional Service

We allow managers to deliver high exposure, multi-channel, professional marketing that translates to high quality results: Reduced (if any) vacancies, higher rents, and better tenants – These “superfluous luxuries” that we include as standard will become the mainstays managers must embrace to survive and thrive. We have partnered with the best industry providers, the same companies used by national real estate agencies, to package a complete gamut of tools that we consider mission critical, where other *ahem* ‘cheaper’ agencies aren’t bothering because they’ve become totally preoccupied with being ‘the cheapest’. For an investor now, listing your own ad yourself is as cheap as it gets. The largest expense an investor can trim, is the manager himself. Focusing on being the cheapest isn’t how managers will win hearts and minds in the coming battle for investors.

It starts with the name

Onsite managers are a valuable asset! They know the complex better than ANYONE. They not only live and work there, but also sit on the body corporate as well as maintaining the complex, and the letting pool. Literally no one has better working-knowledge of the complex or the rental properties within it. We want to make a big deal out of how important an onsite manager is as an expert service provider. It starts with the brand: The Onsite Manager. It’s our name, and for our managers operating under our banner, it’s their name too. The premise is simple: Investors are assured they are dealing directly with The Onsite Manager, not a shadowy third-party organisation or distant and impersonal franchise. This fact should be proudly conveyed to investors and applicants alike and highlights the wonderful benefit an onsite manager delivers over a D.I.Y owner attempting to manage the property from a far or an outside agent who doesn’t know the first thing about the building.

Service is EVERYTHING!

My personal mobile number is 0407 769 944. My phone never leaves my side if I’m awake or asleep my phone is there. I give this number to every one of my managers and I tell them under no uncertain terms – if you have a problem, call me, 24 hours a day 7 days a week. My ethos when it comes to service is: if one of my managers has a problem, *I* have a problem. As the principal of this agency for the past 15 years, and the lead software developer of our entire system, there’s few problems I can’t solve when it comes to our service. I’m here to make sure your marketing runs smoothly for your investors, day and night. I’d like to see you get that sort of assurance from el-cheapo-properties.com.au.

Together, we’re smarter!

We’re in the process of creating an industry advisory service for onsite managers. Eventually we’ll have a specialist hotline of experts, professional development training, insurance services, and much more. Between the 1500 managers, brokers, and associates we have invited to our advisory group we have a combined industry experience of about ten thousands years! That’s a lot of industry knowledge. If our guys have a sticky situation with a tenant, or a contract, or anything else related to this industry, chances are, a hundred other managers have been through it before, this is the place to ask those questions and get valuable and free insight. That insight is valuable to investors, they can’t get that going-it-alone.

Superior Lead Generation and Management Process

Round the clock marketing and lead management

You cannot answer every enquiry right away. No one can… except us. Every single time a prospective tenant makes an enquiry with one of our managers, we reply instantly on their behalf with both an email, and a text message containing everything the prospect needs to know about the manager (name, contact details, address) and the listing. Our system autonomously schedules inspections, it sends maps and diary notifications, it *knows* if entry notice is required and allows time to deliver one if it is, it even follows up with the prospect just before the inspection to ensure they are coming and afterwards it follows up again to ensure they are satisfied with everything. Any changes to the listing price or details will also result in further notifications being sent to all past prospects to see if they may still be interested. All of these processes take place automatically and 24hrs a day. This results in significantly more prospects converting to applicants. 

We also send over a quarter of a million follow-up text messages each year to keep on top of all the leads we generate for managers and autonomously drive the process forward by converting leads into applicants. Commercial text messaging costs 9c per text, and it is not cheap for us to offer this service, but we do so at absolutely no cost to managers because it sets us apart from the other agencies, and sets our managers apart from theirs.

Rental prospects are sending lots of rental enquiries at a time on multiple listings. The agencies who respond the fastest and with the best information, are the winners. The custom lead generation and management process we employ means 12.7% of our rental enquiries convert to a signed tenancy!!! That… is… huge! No other onsite manager agency has this automated process in place, and of course no investor can do this themselves either. It’s not cheap, we pay tens of thousands a year for this service and we spent hundreds of developer hours implementing and customising it, but it’s a critical point-of-difference between our managers, and the rest… and managers need to be explaining the importance of this to owners. 

Exceptional Online Presentation

A Branded Website For The Building

Every manager in our agency is offered a hand-made and custom designed real estate website for their complex. It updates automatically with all the manager’s current listings, it has photo galleries, dynamic maps showing surrounding attractions, information about the complex, contact forms, testimonials and biography about the manager themselves and why they live and breath the complex they represent. This entire exercise, costly as it is for us, is done to showcase each of our managers as an exceptional owner-operator.

Each site is totally unique, beautifully designed and includes domain registration, web hosting and email hosting, all as standard, all free for our managers. These sites are worth about six thousand dollars per website(!), and they allow managers to attract tenants to their complex directly, as well as from portals. They can also serve as a landing page allowing managers to conduct their own social media campaigns on Facebook and Instagram to attract tenants from outside of the traditional portal channels. Each site takes us days to hand-craft, and cost us money to host and maintain, but we do it because it’s a vital service increasing our manager service offering to investors, and setting our managers apart from the rest.

Professional Marketing Assets

We have sourced multiple suppliers for our managers to deliver photography, virtual tours, and floor plans. All across Australia we can leverage our sales volume to deliver managers very affordable professional photographers. Ensuring managers are presenting listings that look fantastic, and professional every time. I have always strongly discouraged managers attempting to use DIY/amateur phone photography in marketing… In the coming age where investors can D.I.Y. market their entire listing without a professional manager, we need to emphasise the importance of engaging professionals, not demonstrating they are superfluous by shunning professionals, ourselves!

Once these beautiful marketing images have been captured, our software will automatically, and instantly generate beautiful emailable and printable colour brochure artwork for each individual listing. Our managers look like they’re running a graphic design studio, outputting stunning marketing material as effortlessly as clicking a mouse. Our software also outputs stocklists in the same way. Again, these quality marketing assets are vital points-of-difference when it comes to presenting rentals and help our managers offer vastly more service than simply sticking ads on RealEstate.com.au. 

A Complete End-to-End Marketing/Management Solution

100% Virtual Letting Process from presentation to lease signing!

EVERY SINGLE ONE of the 500 ONSITE MANAGERS in our agency is offered a professional Virtual Tour, at no cost. These are vitally important for managers to showcase listings in the current covid environment, allowing prospective tenants to walk-through properties without attending a physical inspection. Likewise we give our managers 1Form, allowing tenants to submit applications, lodge ID and references all touchlessly with managers. The process is completed with RealWorks and One-Touch allowing managers to complete and approve lease agreements with tenants entirely online via a smart phone. 

Enterprise Level Maintenance Management

We offer all of our managers an award-winning facility maintenance management system, absolutely free. It can handle regular inspections, maintenance reports to individual lots and common property, multi-stakeholder issue logging and much more. You can confidently show your investors their precious investment is being painstakingly maintained and reported on. We even have a partner company offering full virtual reality inspections of the property every lease term to catalogue and compare any damage insurance or bond claims. Imagine how professional you’ll appear when you can forward your owner a complete VR Walk-through of their investment between each and every lease, to show the exact condition the property is in.

The best market intelligence 

We offer our managers RPData’s award winning Core Logic in addition to PriceFinder. I strongly believe Core Logic is a superior tool to PriceFinder so I include it, at considerably greater cost to us, to ensure our managers have the best reporting services at their disposal. We also offer our managers 1Form’s rental demand database which is a powerful real time reporting tool that can be used to show investors exactly what the rental market in their area is doing. Finally we give all of our managers a fully featured National Tenancy Database credit check service, and we don’t charge any sneaky hidden fees on tenant searches.

Make no mistake, I believe the structural changes coming to our industry: allowing investors to self-manage their rentals; will be a deeply profound and fundamental disruptor. With a strong service offering I believe our managers can survive and prosper in the midst of this change. Our service, everything we offer above, typically costs managers $1.35 a day. It’s in no way ‘expensive’ by any stretch of the imagination. But it isn’t the cheapest, sure you can pay a few cents less if you strip away all of those tools and services, but then what are you really offering your investors that they soon can do themselves for far less than you’re charging them?  All of the above tools and services we offer forge a service offering our managers can be proud of. They will enjoy an indisputable point-of-difference and they can confidently demonstrate to investors why they represent so much more than simply a middle-man posting cheap and basic ads on realestate.com.au.

4 Comments

  1. After years of paying REA millions of dollars in advertising they now are engaging in direct competition with the hand that feeds them, all MLR mangers need to voice there concerns with REA and look for alternative competitors who will not cut us out.

    1. Author

      Careful, I still remember a time when real estate agents were making this exact same argument against RealEstate.com.au allowing onsite managers onto their website.

  2. REA has made a huge mistake letting in all and sundry to corner the market. It, hopefully will be its downfall and if we have any spine on this we should oppose their move vigorously.
    Find a better alternative in numbers and send REA a loud and clear message on this.
    RR

    1. Author

      I understand the concerns here but the reason REA have taken these steps is because, they too, must deal with competitors who allow direct listings. Namely: EVERYONE! Domain, Gumtree, Facebook Marketplace, ALL allow direct listings, and the fact that they do is beginning to impact REA’s audience (they want to avoid a situation where a large portion of listings are no longer on their site because owners are self-managing them directly on REA’s competitor sites and shunning REA). REA are essentially the only portal who don’t allow self-managed listings until now. They were gracious enough to come to us before this policy was made public to advise us of it and warn us so we have time to make whatever adjustments we need to account for it. My sentiment is that if managers are doing quality work, they shouldn’t have to worry about this and I absolutely stand by that sentiment. No onsite manager delivering professional, effective, and quality service should ever feel even remotely threatened by johnny-owner doing a better job than him. But as per my article above, there’s a lot of managers out there being lured by cheapest garbage and bare-bones minimum service standards in the market place, and those managers need to give some very strong consideration to improving their standard of marketing. Now, more than ever before, delivering quality, professional, and end-to-end marketing will be critical for onsite managers.

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