On the cusp of change

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Investors should be ready for changes in buying and selling property as technology impacts fully, new research shows.

Monday, March 7th 2016, 11:00AM 2 Comments

by Miriam Bell

A joint study by the University of Auckland and the University of Sheffield shows that – to date - new technology-driven business practices have not gained the same traction in New Zealand’s real estate industry as they have in the UK’s.

For this reason, system changes are ahead for New Zealanders buying and selling property.

Auckland University property professor Deborah Levy said that, despite the impact of new technology, New Zealand agents have managed to keep much more control of the market than they have in the UK.

For example, they own realestate.co.nz, she said.

“This means agents often still act as gatekeepers of information, which is one of the reasons a full-service agent model remains dominant in New Zealand.”

In the UK, there is a much wider range of service provision – from minimal services right up to full-service – and, therefore, more cost options on offer.

Social media has also not made the same inroads into real estate practices in New Zealand as it has in the UK.

However, Levy thinks these things will change, particularly when it comes to the service options available.

“There is a bit of a generational thing going on, younger people are less likely to want to pay for full-service when they can do things online themselves.

“Also, as people generally can access more information themselves and get more confident doing so, growing numbers will want more service options.”

More property information is becoming available online in New Zealand and there is increasing scope for people to do their own research, Levy said.

“So buyers can get CV information relatively easily, but it is still necessary to pay for more detailed information on the apps and websites currently available.”

The arrival of websites offering free data – like homes.co.nz – is likely to shake things up further as they will enable people to do more comprehensive research themselves.

However, while the growth in technology is increasingly beneficial for buyers, vendors now often need more from agents – particularly in the marketing and negotiating stages.

Levy said that, as prices have gone up in New Zealand’s housing market, buyers have become fussier.

“They are paying more so they expect more. People expect that properties they look at will be perfect and if there is anything wrong they will quibble over the price.”

This means that vendors, and agents, have had to up their game when marketing and presenting properties.

For example, buyers expect multiple photos and walk around videos to be available online, which means home styling is now a must for those wanting to add value in the sale process, Levy said.

“It all has a significant impact on purchasing decisions and sales. Initially, by establishing what buyers will even look at. And then by shaping price perceptions.”

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