The Elephant in the Room Property Podcast | Australian real estate
The Elephant In The Room Property Podcast with Veronica Morgan & Chris Bates

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Episode 67 | Why consumers want more transparency from real estate agents | Kylie Walsh, Di Jones General Manager

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Top 7 insights from an indrustry leader.

Kylie Walsh is General Manager of Di Jones Real Estate and a licensed real estate agent. Last November, Kylie was awarded AREA’s most Influential Woman in Real Estate. Kylie has over 24 years experience and over that time she's held a variety of roles that have taken her from the beach to the bush and back to the city in positions of increasing responsibility. She's worked in management roles for Australia's major franchise groups and along the way has won numerous industry awards for sales, property management and leadership. She's also served a term on the REINSW Board.

You’ll be surprised at some of what we unearthed in this episode. Here’s a snapshot:

  • Technology & how it's changing the way that consumers can get more transparency from real estate agents.

  • Should school catchments drive our purchasing decisions?

  • Why passive buyers will often pay a premium.

  • How to become an influencer, no matter what role you have.

  • Why it’s important to support those with a minority voice.

  • The differences that men & women bring to the table when negotiating, does this even matter to property buyers?

  • And finally, are women really better real estate agents?

Guest Website:
https://www.dijones.com.au/

Website Links:

Episode 12 - John Cunningham
Episode 46 -
Lorna Patten

Work with Veronica? info@gooddeeds.com.au
Work with Chris? hello@wealthful.com.au

Episode Transcript:

Veronica Morgan: You're listening to the Elephant In The Room Property Podcast where the big things that never get talked about actually get talked about. I'm Veronica Morgan, real estate agent, buyer's agent, and cohost of Foxtel's Location, Location, Location, Australia.

Chris Bates: And, I'm Chris Bates, financial planner, mortgage broker and wealth coach.

Veronica Morgan: And together we're going to uncover who's really making the decisions when you buy a property.

Chris Bates: Veronica will introduce our guest in a moment and I can tell you that you want to listen on because we've got a very interesting conversation. We talked about country auctions, we talked about technology and how it's changing the way that consumers can get much more transparency from real estate agents and we finished with, are women better agents?

Kylie Walsh: So the consumers have been asking for a long time for us to be more transparent, they want to have more control in the process, and we went live with the new website yesterday. It very much puts the buyers in the box seat.

Chris Bates: Please stick around for this week's Elephant rider bootcamp and we have a cracking dumbo of the week coming up.

Chris Bates: Before we get started, everything we talk about on this podcast is general in nature and should never be considered to be personal financial advice. If you're looking to get advice, please seek the help of a licensed financial advisor or buyer's agent. They will tailor and document their advice to your personal circumstances. Now, let's get cracking.

Veronica Morgan: In this episode we pick the brains of Kylie Walsh who in November last year was awarded the title of the AREA most influential woman in real estate. Kylie is general manager of Di Jones Real Estate and a licensed real estate agent herself with over 24 years experience. And over that time she's held a variety of roles that have taken her from the beach to the bush and back to the city in positions of increasing responsibility. She's worked in management roles for Australia's major franchise groups and along the way has won numerous industry awards for sales, property management and leadership. And she's also served a term on the REI New South Wales Board.

Veronica Morgan: And given your recent award, we'd like to explore what it takes to be influential in the real estate industry and are they differences that men and women bring to the table and why does this even matter to property buyers? But I might even turn this into a personal mentoring sessions. I think that being the most influential woman in real estate is something I should aspire to. Anyway, thank you for joining us Kylie.

Chris Bates: Even me.

Veronica Morgan: You too, Chris.

Chris Bates: Thanks Kylie.

Kylie Walsh: Great to be here.

Chris Bates: So I mean, there's many industries that are quite male dominated, and boys club. Have you ever felt that the real estate industry is a boys' club?

Kylie Walsh: Look, I've been incredibly lucky during the course of my career. I think it was how I was raised as well by my parents is that you just have a red hot crack, and I've probably always been pretty authentic in my delivery. I'm very black and white and I think the men that I've worked with and the companies I've worked with have known that. But I can honestly say that I have not experienced that.

Chris Bates: Yeah. Okay. And so, why do you think that there's a most influential woman, but then there's not most influential male awards?

Kylie Walsh: Yeah, interesting. So, I actually bought that up in my interview, which I thought may not go so well for me, because I'm not a big buyer in the bra kind of person. And I do think sometimes we damage that for women in real estate by being more around having events and award such as this. But unfortunately not everyone is as strong a person as I am and hasn't probably been as blessed as I have been with my career and my upbringing. And I think for those that don't have the voice, is that until we do have equal pay rights for example, I still think we've got a long way to go for that. That we do need to support those with a minority voice, and that will happen. It will happen shortly. We've come a long way, particularly in the last 10 years, but there's still a way to go. And as I said, not everybody's is as probably vocal as I am and as strong as I am, so if I can make a change for women in real estate and professionals in real estate, then I'm up for it.

Chris Bates: And so what were the reasons why you won the award? Was it in any means that you're very vocal. How are you vocal I guess out there in the industry? I'm just very curious.

Kylie Walsh: Look, I didn't actually know I was nominated for the awards because my marketing team know that I'm a little bit anti the women in real estate campaign, so it was quite ironic. So, they nominated me and then after I was presented with the award, I actually went to the judges, and I'm like, why me? Because there was so many other amazing women in that category and they said, Kylie, I think it's what you do behind the scenes and you're not so vocal about it and do a lot of press on yourself for it. So, I do a lot of the lobbying, and also over the last probably two years I've done some talks at Parliament House and I've worked quietly behind the scenes with mentoring, coaching, reworking CPD legislation.

Kylie Walsh: And, I think because I've been fortunate enough to work in the city and also regional areas across Australia is I'm really proud of the fact that I've had an impact on all professionals in real estate career at some stage. And I probably haven't been good at voicing that myself, but just get on with it behind the scenes.

Veronica Morgan: Yeah. There's not many people that actually do understand the city markets and the country markets. And so where does that come from? Where did that experience come from?

Kylie Walsh: Look, I think, I grew up in the country, I'm from Narrabri and when I finished school all I wanted to do was get to Sydney. So I came to Sydney, started my real estate career in Sydney, then saw an opportunity back in Tamworth, which is where I went to boarding school. Learned a lot about auction in the city and thought, great, I can see a real opportunity here to be transparent, be a market leader, reduce days on market in the local area, and I didn't know any better. I was 21. I had enough money just to pay the stamp duty and the legals and went for it.

Veronica Morgan: How did it go?

Chris Bates: Exactly, yeah.

Kylie Walsh: It was great. So we were-

Chris Bates: What year are talking? I mean, that's probably too much information. Rough decades.

Kylie Walsh: No. All good. All good. So look, it was the early '90s and we started with myself, receptionist and a property manager, like most stories and then we grew to be the number three office in the country. And when I sold out, I was the number one regional principal for Australia and New Zealand and Tazzie. So, it was pretty cool.

Veronica Morgan: Wow. That's quite an accolade. So, what were the challenges in getting auctions accepted in the country and lowering days on market and all those sorts of things? How did you do it?

Kylie Walsh: I think it was our competitors that were really scared about, okay, who's this person that's come back that's full of energy, that just wants to give it a crack. And back then you couldn't get an auctioneer in a regional area, so I used to fly somebody up from Sydney that I had a contact with because there was just no good residential auctioneer. There was all the cow cockies, stock and station agents, but it was edgy, it's a very different knack. They're great at what they do, but residential real estate's very different.

Kylie Walsh: And as I said, I didn't know any better. I just had all this energy and passion and I was like, this is 120 days days on market from a cash flow perspective, getting into a business, which is crazy. We would need to reduce the days on market, create emergency for both the vendor and the buyer and be more transparent in our dealings.

Chris Bates: So, you've got established people there, but this little office and you've come in and you've disrupted everything and you've one market share on a stock, you've kind of built it I guess. I mean, in real estate here, you find that in certain patches that there's usually a couple of key leaders that are selling on a 70, 80% of the property. What's your view on how easy is it for new agents to come in and dislodge them over the space with a few years by just getting a few runs on the board?

Kylie Walsh: Yeah, I think it's really easy. So, I've just gone through this in the last couple of days with some new status in my team in Paddington, which is one of the most affluent areas in the country. And I say this is the time high performing agents are complacent. Everyone's all down in the dumps about the market, this is your time to come in, show a bit of passion and enthusiasm. People don't want you sitting in their lounge rooms slapping around being all doom and gloom, come to them with solutions, a fresh approach. And I said passion and enthusiasm every day of the week when you first start out will win you new business, you just have to believe in yourself and back it up and deliver on what you say you're going to do. So I think it's a really exciting time for disruption with new agents or people that are doing it a bit differently.

Chris Bates: How would you coach that agent though because the person selling the property they've got a few biases, they're just looking at the billboards around the area and they see that Johnny and Matt have sold 80% of the properties. And then you've got this new young agent coming in. How do you coach them to prove that they're better I guess, or they're a better choice than that agent?

Kylie Walsh: Yeah, so for us at the moment, we're focusing on buyer communication and buyer relationships. And I think, what we can demonstrate to clients in our local market is now the distribution of our network, is where buyers are coming to and from, is how we've built our network, particularly in the last three to five years. And I think that compelling evidence as to what we can show vendors and what that means they're going to get for their end result and in a timeframe, I think that speaks for itself.

Kylie Walsh: And then I think the other side of things is obviously if someone is green, then we need to take an agent in that is better at negotiation. So, all our new guys are trained in such a manner that they're all great with buyer nurturing and communication to try and get that buyer to be honest with us. And it's very hard thing when agents are so low down on the food chain. But we train our guys around buyer meetings like we do vendor meetings, and if we've got a better relationship, we know where their at and we can help them more with their finance and that allows us to get them up in price as well if we need to do the best thing for our clients.

Kylie Walsh: Because with interest rates the way they are, and then you've got the media talking doom and gloom, I think it's a great time to get in and have a red hot crack, particularly in the markets that we're in because popular marketplaces that are close to the city will always be popular.  And, I think there's never a bad time to buy in those areas because they're always stable and they only go down so far.

Chris Bates: Yeah. I mean, and just for our listeners, can you just enlighten them on where exactly your offices are because I think that's a good point, right? So, it's a great time to enter the market as long as you're buying in these amazing suburbs. Where are you talking?

Kylie Walsh: Yeah, so existing networks, we cover the Eastern suburbs inner city, North shore, Northern suburbs, and the Southern highlands. And from next month we will also do the lower North shore, so Mosman, Neutral Bay, Northbridge and Chatswood.

Veronica Morgan: Wow. And when we say next month, I have to say, listeners, we record this, and then we may hold onto it for a little while before we launch the episode only because we schedule them and move them around a bit. So, we're recording this in January 2019, but we'll try to get this to air as soon as possible. But you're saying in February 2019 there's a big announcement.

Kylie Walsh: Yeah, so from February one, the previous McGrath lower North shore offices, who's the McGrath number one operator will join Di Jones.

Veronica Morgan: Oh wow. Okay. Well, that's a bit of a coup, isn't it?

Kylie Walsh: Yeah, it's fantastic. So, two businesses coming together, same sales turnover for our group and their group last year, but we've just ran the numbers in our kickstart and it'll make us the largest sales business in New South Wales for volume and turnover.

Chris Bates: Wow. And so, you're a top dog I guess, or cat at McGrath, and yeah. I mean, so why would you upset the kettle I guess, why would you jump ship when you're at the top of the tree?

Kylie Walsh: Look, I think the attraction for McGrath lower North shore group to come to Di Jones was that we're very agile. What we're doing with technology at the moment is really exciting. We're responding quickly. We did a big project at the end of last year, which I spoke on it at a business conference in Queensland around what we're doing with CX and what that means for the consumer. Consumers been asking it for a very long time.

Veronica Morgan: Consumer experience.

Kylie Walsh: Yes, sorry.

Veronica Morgan: That's right.

Kylie Walsh: So the consumers have been asking for a long time for us to be more transparent, they want to have more control in the process, and we went live with the new website yesterday. It very much puts the buyers in the box seat and we're the first real estate professional in the country to do it, so it's really exciting.

Veronica Morgan: How does this work, tell us.

Kylie Walsh: So, on the home screen the buyer actually logs in and if someone's sitting at home and thinking about selling, but I don't actually want to talk to a real estate agent, which being married to a lawyer, I know it comes up a lot around the dinner table. They don't really want to engage with an agent unless they have to, but they can log in and find out how many people we've currently got in our database. So, they log into our database, and they find out how many buyers are currently sitting in our database qualified, ready to go, looking for a property like theirs.

Chris Bates: Wow.

Veronica Morgan: That's pretty interesting because I know a lot of databases are full of crap as in just volume and they haven't been kept up to date, and the information is dubious at best, but you're relying on buyers also to put that information in there, I presume. How does that all work?

Kylie Walsh: Look, I started at Di Jones in 2014 and since that time and when our CEO Robert Ward came in, in 2016, our key focus has been on cleaning up that database because we knew that this was the end game within three to four years to launch this website and we had to be organized. So, we have a full-time database manager who works on cleansing the data when new agents come in, and we have a collaborative approach whereby we only have one database. It's in all our employment agreements, and we are very, very firm on what goes in.

Chris Bates: You said that the reason you're doing that is because a lot of people, all your customers or your buyers want more transparency and they go, that's great. So now they know Di Jones have got 40 qualified pre approved buyers that are looking to buy under $2 million houses, can they find that type of detail information?

Kylie Walsh: 500%.

Chris Bates: Yup. When does the transparency stop though? Because, the whole game of real estate is to a little bit to not let too much transparency out because then you don't have urgency and then you don't have bidders. So, when are you going to have to say, well that's it, you've got enough now. We're not going to tell you how many people have made offers or how many people have got contracts or how many people that ... What are the offers? Is that all going to be online or is that-

Veronica Morgan: I think you're a step ahead there Chris, this is really just potential vendors dipping their toe in the water, seeing are there really buyers out there interested in my type of property that I have? And if so, does Di Jones really have them, have access to them? They haven't listed yet, right? So you are thinking when they're listed, is that correct?

Kylie Walsh: Yeah. No. So, this is prior. This is exactly right. So, we did a big project last year that we called project Bermuda, where we surveyed a thousand-

Veronica Morgan: Oh code names.

Kylie Walsh: Yeah. A thousand purchases out in the marketplace and potential vendors around what frustrated them. We monitored inquiry response times, what they really want from an agent, what they believe to be true when we're actually talking to them and what they think that we fluff. And one of the big things that came out of that was people going and sitting in a lounge room saying we've got X, Y and Z, amount of buyers on our database. And there is a lot of groups that do that. They go in and say, we've got 300,000 people on our database and you they might be a franchise group, for example. And I know from being in franchising they don't share databases.

Veronica Morgan: Exactly.

Kylie Walsh: So, I think there's a lot of myth around it and the consumer is actually starting to know that. So for us it was about being transparent. It's live data, so it changes. If there's another buyer that goes in while you're actually in there looking, the numbers will go up. And then stage two is around what else can happen in the database, so I'll come back in six months and talk to you about what's next.

Veronica Morgan: Yeah, because this is all I guess, using AI and everyone's talking about what's going to happen in real estate and how will technology disrupt, and I guess this is an indication of what can happen there. And obviously you've got a powerful thing and that is a database and this is how to use a database. One of the franchise group, who shall remain nameless is using their database to try to create a new business arm, and it makes sense. You've got all these people, right? In there. How can we milk it? And they're talking about ... Basically it's a bit the same as in restaurant industry nose to tail dining. I want to own that buyer for their entire property ownership journey, which is from a business point of view, smart, from a consumer's point of view, alarming. I think consumers need to be aware that this approach is out there. How does this maybe fit in or differ from that?

Kylie Walsh: Look, I think our database isn't around being big brother or following them around the net or anything like that. It is actually about how can we keep that relationship, stay relevant and be more trustworthy. And I keep coming back to the word of transparency. If we do our job and we are transparent and we create that trust and we're doing buyer meetings like we are doing our vendor meetings, then we will keep them for finance and insurance and other tag alongs like that. But I don't think that we should just dictate that or reserve that right. That comes from credibility and relationships, and we've just found from our consumer because we do a lot of analytics on our database that if we deal with our clients three times, they will never leave us and be that property management, finance or sales.

Kylie Walsh: So that's why we've grown our network like we have because we find that our buyers and vendors never leave that migration data of where our officers are to and from seldom unless they get transferred overseas or to another state, someone might go from the northern suburbs up the north shore line to Wahroonga, sell up Wahroonga, come down to Willoughby. Leave Willoughby, come to Paddington, sell in Paddington, come back to inner city. And so it goes.

Chris Bates: So, it's interesting because you're a real estate company, but now you're taking on the banking model. So the banking model is, let's sell them products and then sell them more products. And then the more products they've got, they're less likely to leave us because the more that you invest in a company. So, banking model is basically give them a bank account, and then as soon as they've got a bank account, they've got about 50% chance that they'll leave. If you give them a credit card that drops to 10%, but then if they take out some home and contents insurance that drops to 5%. And if they take out some financial advice or get some insurance, they drop to 1%. So, do you see that-

Kylie Walsh: I don't agree with that to be honest with you, I don't think we're going down a banking model at all. I'd liken it to I suppose a medical journey that I've had in the last couple of years and I go to the Mater for example, in north Sydney for my services. I go there because I get a good service, not because they're flogging me things. And for us, it's around what are the three service models that we can provide you that add value and transparency that you don't want to leave us. It's not about flogging products that's on our model at all.

Chris Bates: Yeah. I just think it's like in terms of, now I think we're doing real estate, but now we're doing insurance and we're doing loans and we're doing ... Et cetera, is that the ...

Kylie Walsh: They're not owned independently, owned and operated businesses. It's about providing a service. So we had a client night the other night at Wahroonga for example, and one of our investors didn't realize that the different options that were available to him for an offset account. And we saved him 17 grand a year. Now we just referred him to our preferred partner. We don't own that company, but we've provided a service whereby we've added value, he saved money. And that's one touch point, he will never leave us because of that value. I don't think we do enough of that in our industry.

Veronica Morgan: I agree.

Chris Bates: I agree. I mean that's the opportunity, right? The opportunity is to be that trusted advisor at the first point of call, identify all their needs and everything they need to be thinking about. And then either whether you're doing it in house or doing it with referral partners-

Kylie Walsh: It's irrelevant, right? It's just providing service and being trusted because there's so many cowboys out there in our industry and-

Chris Bates: And cowgirls.

Kylie Walsh: And cowgirls, yeah, cow people.

Veronica Morgan: Back to the women thing, right? I went to the women in real estate conference last year, and in fact I'm speaking at it this year, so it's in ... When is it? March or April, I should know. I'm going to check my diary. So, I'm going to be talking at it this year, which is great and you may be too, I'm ... Yeah. Okay. Leanne Pilkington, who's the president of the REI, REI New South Wales, I should say. She got up and gave a bit of a talk about, she's never really been a champion of women's rights or women's opportunity beyond just generally opportunity and that professionalism in the industry because she herself hadn't been disadvantage because she's a Bolshie woman I've known lately and for many, many years.

Veronica Morgan: And, I've often felt the same thing in fact, because I thought, oh God, get over yourselves really. But, like what you were saying, not everyone is given those opportunities at birth. Really. I mean, my personality and my voice was given to me at birth, and so with Leanne's, and no doubt so was yours. And not everyone's had the same opportunity to actually be a voice and have a voice. And I think it's really great that women like you and Leanna, and me even, are recognizing that we have been blessed and to help others who may not be so blessed, but there's going to be men in that ...

Kylie Walsh: Absolutely.

Veronica Morgan: In that basket as well. Such an interesting thinking around that though, and I thought when I went to my first ever women's ... Leanne actually she started it called Catch up With The Property Girls some years ago. I went to the inaugural, I remember I was actually facilitating a group and chatting to some women there who were saying that, oh no, it's an absolute boys' club., I was speaking to one young woman for instance, who's really, really passionate about her career in real estate. And she was saying in her area, not one principal was a woman. I was really amazed by that because when I joined real estate, I actually joined Sarah Lorden Real Estate several years ago and it was all woman office. We never had one guy to town working there when I was there. Not through design, it's just most guys weren't brave enough to come, and so I personally had never experienced a situation where it was a boys club and I was locked out of anything. So it's just an interesting, because I think that's still the case and I think that affects a lot of buyers in certain areas. Don't you think?

Kylie Walsh: Yeah, I agree totally. Thirdly, I think buyers just need to feel comfortable with the agent that they're with. And I think also that given that ... And look I don't know if this is still a number, it used to get bantered a lot, 86% of all purchasing decisions were made by women. I don't know, is that still ... Has there been any new research done on that?

Veronica Morgan: No. Not to my knowledge. And it's, how do you measure that either? I mean, even at auction you see, and it might be the guy might be the alpha male and he might be the one doing the bidding and then at the back of it, you've got her pulling on his jacket or something.

Kylie Walsh: If she wants it, then often you'll see people go higher. But I do think if that trust is there, and I must admit, I have been able to see a lot of women get that extra bit of money from the female buyer if it's a couple buying, particularly in auction conditions, because of that connection and they bring it back with the rapport to the children, great backyard or whatever or this will be easier with your lifestyle. And to have that, whether it be male or female and get that extra emotion out to get the buyer to go more is obviously what the vendor wants and I must just say I'm not being sexist. I've just seen women on an auction floor, in particular, be able to do that in a more trustworthy and natural way in a lot of occasions. Not taking away from lot of men that are great on the auction floor, but it does seem to come a lot more natural to good female auction agents on the floor doing work.

Chris Bates: Yeah. I mean I think it's even interesting that both parties are getting mentioned here in the decision because a lot of the time sometimes you're dealing with one party, so who's managing the communication. But behind the scene there's an actual other party that's having a conversation and they are getting a huge pay. And, good agents would know that there's actually you got to make both people happy if they're going to buy the property. And it happens a lot in financial advices and one party, whether it's the male of the female, it doesn't really matter will contact me and then they'll say, look, I'll manage it for the family, et cetera like that. And what I'll always have to do is rewind, no, I know that's what you guys want to do but we need to get you both there for the meeting.

Chris Bates: And then when that happens, sometimes the one party will do the talking and the other one won't. But in that scenario there you've got to stop that person talking and then give the other person space and comfort and security to actually talk and get their opinion out because that's where you are actually going to build trust. Because if you haven't got trust, you could have trust with one side of relationship, but if you haven't got trust with the other side, because you haven't really built a relationship with them, you're never going to build a trusted relationship because that person's always going to be, they're housing you I guess.

Chris Bates: So, I think it is true and I think the best agents out there would probably understand that the woman has a huge part or the other way around. If the woman's dealing with ... The man's having a huge impact. And so I think the best agents realize it's both.

Veronica Morgan: Yeah. Kyle you mentioned that you had buyer meetings in much the same way you have vendor meetings, is that what you do there?

Kylie Walsh: So, that's what I was just going to lead into. And I think it depends on the marketplace. And sometimes we do see a change particularly in, and I probably won't say the market places, but sometimes in more affluent areas, there maybe someone that's a merchant banker or a CEO or something like that, and you will see that individual, be it male or female, take control if that's more their personality. But the reason we encourage our buyer meetings, particularly with our agents is exactly what you've just said, is if you get in front of a buyer and you start judging body language and you see who's taking control or who's maybe sitting back and wanting to say something, that's when the nuggets of gold come through, and you can often see that it's like one o one when I first got into the industry and my first coach said to me, when you sit down in the lounge room table and you talk to people, make sure they're across from you and you can see their body language between the two.

Kylie Walsh: I think we've become such bloody keyboard warriors in the industry with texting and email that that element of face to face and communication, a lot of people need to be very careful they don't lose that because that's when we will become irrelevant and be taken over by disruption and noise. But if we keep that face to face and as you would know being buyer's agents in your space you have that relationship, the eye contact, monitor body language, what personality type are they. And we do a lot of work around that, so that's a good result for us but also for the buyer and the vendor.

Veronica Morgan: Tell us about the work you do around personality types.

Kylie Walsh: Yeah, we do our training and events calendars each and we do a lot of work around that personality profiling and making sure people understand what they are, so when they communicate with people. And I wish I'd had that when I first went into sales because I'm very quick.

Veronica Morgan: What methodology do you use?

Kylie Walsh: We do a lot of disk and a lot of caliper. So, I think the sales person understanding what they are first and foremost, is important. And then reading your clients how they'd like to be communicated with, what's important to them, how much time they need. Because agents sometimes can be really pushy to close the sale. And, if you try and do that with an S and C personality from a disc profiling, you just got to get them off side. And doesn't matter what you say or what you offer, you push them to close or make a decision and they're going to be like, I got married to a C and then he researches again and then he does a paper and then he wants to talk about it.

Veronica Morgan: I'm trying to remember the disk. So, the C is what we used to call Consci, conscientious people, and S, is sensitive.

Kylie Walsh: Sensitive, and they're very slow and like to make a decision, but very smart and very analytical. Need all the facts, need to review it and then need buy in from other people. And so then they'll probably go to a third party and get more advice.

Veronica Morgan: And the disc is you curve it into half, there's the introvert and extrovert. So the D and the I, the influencer and the Director, is usually going back to my psychology when I was in recruitment. So, the influence and director, right? They're the D and I or the I am the D, and then more of the extroverted side of the spectrum and on the influence ... Sorry, the introverted side of the spectrum, you've got your conscientious and you sensitive. And so understanding that and I guess as a buyer not even being that self aware, I'm hopefully people are pretty self aware. They know where they might sit. Obviously you're going to respond to that, if somebody actually recognizes these signs you're giving, you're more likely ... And that can be good for you as a buyer, but it can also be manipulated, right?

Kylie Walsh: Yeah. Look, I think the cowboys and cowgirls will manipulate to that, but at the end of the day, if we want that client to stay with us for life, it's not about the one transaction. It's about the three touch points. So, I always say to my guys, how would you like your sister, your mother, your brother, your father treated in real estate? That's how we treat our clients. One of our core values is family, and that's both internal and external. And that's why I repeat referral rate is up over 70, 75%, because we do treat people like they should be treated.

Chris Bates: And you'd deliver their information in the way that they want to be dealt with. There's nothing worse than someone who's analytical and you're talking about things that aren't going to ... At the end of the day, they want the facts and they want to know this is what they're doing and this is the process, and if you keep talking about taking them off the direction, you're just going to annoy them, I guess subconsciously and you just lose a buyer. So I think a lot of this profiling stuff, I think it's amazing because what you're actually doing is just helping the way you're dealing with someone and they're getting a better-

Veronica Morgan: increase outcomes.

Chris Bates: Yeah. And a lot of that time is just motivating them to do something that's good for them. I mean-

Kylie Walsh: By giving them permission to.

Chris Bates: Well yeah, I mean, I'm reflecting with a client at the moment and he's really smart, he's tech background but he's very analytical, right? And I know that when we draft an email to him, he's going to read every single line and he's going to go across. And so, me and my business partner, our emails are so detailed. He loves them, but we know that that's the crane ingredient he wants. He wants to see these trail, but with other clients they don't even want the email. But they just want literally, where is it up to? Hey Chris, how's it going? It's good, all on track.

Kylie Walsh: How much? How long?

Chris Bates: And if I wrote them a long email, they're not going to read it and they're going to feel like they should and they're going to feel like they're letting me down by not reading the email, so I think it's so important to understand. And then also be a bit self reflective on who you are as well, because the way that you are is not what everyone else is and you can very easily push your beliefs or the way you like to deal with things onto them. So, very smart.

Kylie Walsh: Yeah. And I think too also it's hard for buyers, right? Because, an agent can sit in front and say, oh, we're trustworthy. We want to help you. They'll probably all say that. I think it's hard for a buyer, who is that person that I do trust and I get information from. And I always say to my guys, remember emotional bank accounts. So I always say, you must make three deposits before you ask for a withdrawal with a buyer. So if someone comes to an open, don't just call them back and ask them what they thought of the property and get feedback for your vendor, what is it that you're providing them with? Are you also helping them with what's on the market, what's that property competing with? How does that compare to what they've seen, but also like give them the CMAs that we would give to our vendors around what sold. If there's anything that's been relevant out in the media around interest rates, for example, or what's happening with the school catchment in that area. Let them know.

Kylie Walsh: We're getting a lot of noise at the moment in our core markets around school catchments and pricing going up where there's good schools. And I think that's going to drive a lot of buyer behavior in the next five to 10 years. And I think people are really starting to assess what they pay for private education versus experience because we're all so busy. So, I think we're going to say some big changes in there, but how do you know about school catchments for a buyer unless you ask them?

Veronica Morgan: Well, it's interesting actually that because I've got a whole bit of a theory on this and I actually agree with you. As real estate becomes more and more expensive in these inner areas, what I think people are going to be starting to look at discretionary spend and also as it's more and more difficult to get finance. And the banks are now saying, well, you've got all these school fees, you can't actually afford to upgrade your home. People's decisions are going to be very different around schooling than they have been in the past.

Veronica Morgan: Because traditionally, and I'm sure you'll agree with me, people were fairly comfortable to send their kids to a local public primary school. And then there's this mass evacuation at high school and at some key points during that primary school journey as well, but particularly in year seven. I'm doing the same thing, my daughter's going to a private high school, right? But she's gone to a public army school, and I see that changing. I certainly see the same demographic in terms of my cohort or my daughter's cohort and the parents. There's quite a lot of them going to public school and there's an attitudinal change. And so that's going to be very interesting.

Veronica Morgan: The problem with that is that the school catchment area and the myths around individual schools, it's actually largely bullshit. And, I find that interesting from buyer's point of view making decisions around buying a house because it's in a certain school catchment area and then that impacting on price, and then they can get their kid in that school and realize that culturally the kid doesn't fit or that a little school is actually not that great. A big school would be better or vice versa. Do you know what I mean? So, a lot of buyers have a huge amount of fear that's driving their decisions around where their kids go to school, and are we going a bit of a segue here. But I have a bit of an issue with catchment areas being the determinant of price and buyers feeding into that because I think it's a bit of a lie. I don't know what you think about that.

Kylie Walsh: Look, I'm a big believer, the wisest investment a parent can make is in their child's education, be it public or private school, wherever's going. I mean, we were incredibly lucky in Sydney that we've got so many great schools growing up, 240 clicks from the nearest town. That wasn't something that I had the luxury of, but look, we are seeing it driving by behavior and prices.

Chris Bates: Yeah. And I mean it makes sense whether that turns out to be the right school for that child though is what I think you're saying there is ... Because they may not fit that school, whether it's what they're naturally their strengths are or whether their sport and they might decide to ... They might be gifted students well they are all bloody gifted, but anyway. I guess, I mean that's-

Veronica Morgan: They might have found their gift while sitting still at school. I didn't find mine while I was still at school.

Chris Bates: No. Were you not in the gifted class, no? But anyway, I mean, yeah, I think the whole schooling thing is quite funny. I mean, we're in Waterloo, right? And so if you were thinking about things with school catchments, you would've said, right. State government needs to build more schools. Right, New High School coming to Surrey Hills. It's high level, it's going to be ...

Veronica Morgan: A high story.

Chris Bates: High story, vertical school, whatever it's called. It's right near the city. Okay, we'll buy right near the school. And so, you buy right near the school and then they release the catchment area, right? And what's pretty hilarious, which is not right, the state government just basically went, right. Okay, we'll just draw this line and we'll just draw out all the areas that are also here economic and basically we'll push it towards the city. And so people who bought near the Surry Hills New High School, right next to it, 100 meters, 200 meters, are not in the catching area. So, you've got to be really careful because catchment areas are never set in stone.

Veronica Morgan: Well they change. And also, they will change year to year. And also the principals change, and all of a sudden the popularity of that's cool changes. So it's a really dangerous thing.

Kylie Walsh: Yeah. I think probably in areas like Surry Hills that are expanding really quickly. A lot of our markets are more traditional and catchment zones in a lot of those areas haven't changed for a very long time. So look, not to say it couldn't happen in areas and probably will, that's a really example and that would be really annoying as a buyer. But all I can say is from ours what we're seeing. Yeah.

Chris Bates: I'd love to talk to you about a bit of a conflict with real estate agents that it's always out there. You mentioned that it's a really great time to buy for buyers and in the areas that you work in, the lower east, the north, et cetera, premium suburbs, its a great time to buy. How's the conversation going with the sellers because the buyers a lot over it. Smart ones are going well, yeah, it is actually a good time to buy. You just tell me what I want to hear. How are you handling that conversation there with sellers, because they're the ones who are freaking out right now. Do we sell? Do we halt? Do we just upgrade? How are sellers behaving right now and how's that much different to say six months ago?

Kylie Walsh: Can I start by saying, I think if it's right for you and your family and your personal situation, it's always a good time to buy, and in 10 years it's irrelevant. But, with our vendors, we've got some prices in some of our core markets that have stayed the same. That's not a general consensus across the board. We are seeing 10 to 20 to even 30% off in some areas.

Veronica Morgan: So, you mean individual properties, some who stayed the same and others have fallen.

Kylie Walsh: Yeah, like premium properties that are well sought after haven't moved that much to be honest with you. It's just that those properties have stopped coming to market. The stop to market is right down.

Veronica Morgan: And this is really important. And just for listeners point of view, we've had these same conversation in a number of interviews over the last few months. And this idea of A grade properties that are in short supply and high demand will retain value even when everything else is falling off a cliff. And I think you've just said exactly that. And part of that is the demand, but part of that is the supply that the owners don't feel under pressure to sell, they know they've got a good asset, and so therefore they just put a lid on it.

Kylie Walsh: Exactly right. And I think too because there is so much media hype out there at the moment and there's no doubt the markets come off. We're not seeing at auctions what has been happening, the people through buyers, we're not getting 30, 40 groups through opens anymore. You might get a handful. So, when you meet a buyer that is ready to go, they're gold. You hang onto them and that buyer relationship is more important. And I think just being honest and upfront with the clients from day one, where are you moving to?

Kylie Walsh: So, if someone's selling in a suburb, and they're going to a suburb that is down a bit, and they've got to take a 15 to 20% hit on their end, but they're saving 30% where they're moving to, again, irrelevant. But I think unless they've got the right financial advice or having the right conversation with their accountant or their broker or whoever it is that's going to be put into perspective for them. And it's very difficult for us because obviously we can't get financial advice, but we can give them a bit of an idea and guide them in that area. A lot of buyers, because they only do it two or three times in their lifetime, they don't think about it like that.

Veronica Morgan: No, they don't.

Kylie Walsh: They don't think, okay, well my monthly repayments are going to be this, but I'm moving to that area and I'm saving on there, and it would never be enough to buy a three and a half million dollar home in that suburb, which is now probably three. And what does that mean for my family? So, it's all relative and I think it's up to the agent to dive deep and find what's really motivating that person, what the circumstances are and helping guide them through that. But, it's different for everybody, but the market has definitely, definitely softer. There is no doubt about it.

Veronica Morgan: And you mentioned earlier on about the thing with the younger or the newer entrance to the market and I was careful saying younger agents because they may not necessarily be young chronologically. The newer entrants to the market, how their advantage, in this case is their passion and drive that they're bringing in new ideas and whatever. So, they're sitting in the lounge room with potential vendors and I know, I hear a lot of sales agents they were very negative and all doom and gloomy and some of them are quite experienced. And I'm actually quite surprised that they aren't keeping more of a level head to be quite honest.

Veronica Morgan: So, I guess how do you have that conversation with somebody who is reading the papers and he's thinking that their property is falling off a cliff like everything else. And how do you keep a level head around that? I mean also, given that you're talking particularly in this example that you gave, you're talking about agents that haven't necessarily been around the block either. You know what I mean? They haven't dealt with down times and good times. How does an agent do that?

Kylie Walsh: Look, I think our job is to negotiate and provide the best marketing strategies that we can to get it to the widest audience, so everyone knows about the property. Agents forget that we don't determine market value. We have nothing to do with what a house sells for. We can try and get as much as we can for the client and bridge the gap, but we're there to negotiate, pump buyer and vendor for as much as we can so we can happy medium. But, we're there to make sure that they've got the best marketing options available to them in the marketplace and that no stone is left unturned. That's our job. Our job is not to tell them what their house is worth, and I think that's where a lot of agents go wrong. So we really focus on that whether they're new agents or existing agents is we can guide. But at the end of the day, willing buyer, willing seller that determines market value, not us.

Veronica Morgan: Yeah, but then you are doing the appraisal and you are actually giving them some guidance in terms of what to expect. You know what I mean? And it's funny, so many of the people that were interviewed, and I remember one in particular, Ewan Morton and he was like, buyers and sellers now they've got all this information at their fingertips, they're educated, they're smart, they work it out for themselves. But that doesn't take into account the elephant, the emotion and the fact that I want my house to be worth more than that.

Veronica Morgan: And that's a real challenging thing in any market. It's certainly in a rising market. It's probably in some regards more challenging because everyone thinks everything sells at a premium. So, you're not determining what it's going to sell for, you're not determining what the market will or won't pay, but you are giving them guidance in terms of what your expectations are given what you know about them. So, how do you reconcile that?

Kylie Walsh: Yeah, look, I find the whole thing hilarious and that's why I lobby a lot for legislation and changes with some things that come out from government because that 10% variance and the agent has to give now with quoting price, most ridiculous legislation that ever came out. Valuers aren’t even dictated by that. And they've got a degree and more qualifications and formulas. And so to be able to say within a 10% variance what a house would go for is insane.

Chris Bates: Yeah exactly.

Kylie Walsh: Look, all we can do here is give them what's happening in the local market, what we're seeing happening, factual. Keep it fact, keep the emotion out of it because we will not determine the price, and then we can guide them and then they can go and engage, evaluate. Or, they can go and talk to their finance or their bank around what they pay. We're telling them what they've got to pay, we're just guiding them.

Chris Bates: Yeah. I think the hard thing is if you're an agent and you're sitting in there, you get a call, I want to sell market's going to crash. I got those in the article in the AFR the other day. I'm selling to beat the crash. It was a poor property, so I don't ...

Veronica Morgan: Sometimes I need to.

Chris Bates: You know what I mean? And I think, bringing good assets. And I think as an agent on the selling side to be that true trusted advisor, you've got to say, look, I know you want to sell. I know you want to beat this market crash, but if market's not doing very well and maybe it's not a great time to sell, but then you may be ruling yourself out of a sale. And I guess it's just where do you put your moral compass, I guess from ... Because then on the other side you're going to be at open housing, every other buyer, this is great time to buy. But the only way you've got that property on the market is to sell.

Chris Bates: And I think it's just really interesting to say how you're managing. If it's a home upgrader then yeah, it's pretty easy to make sense. I guess it's when you've got investors that have got little reasonable assets, but they not really probably a great time just to be rushing it to the market. How does Di Jones deal with that I guess?

Kylie Walsh: So we've always had an ethos that we don't want to be the agent with the most boards in the marketplace that don't sell. There's nothing worse than an agent that just goes and lists and buys listings. So, for us it's a whole day to talk about what we do around that side of things. But at the end of the day, we get to say a three month exclusive with a client and we haven't sold it and we've over promised then that relationship's gone.

Chris Bates: Yeah.

Kylie Walsh: So, it's being upfront from the start and letting them know what it's like. And, if it's not a huge margin that they're over, and again, who are we to dictate? But if we've got an idea that they're way over, we'll walk away from the business. But if they're within a range that we believe is possible, and we'll be really honest, we'll say, look, we'll go out there and try and get it, but if it's not there, then in two weeks time we're going to sit down and have a conversation. Are you okay with that? And if the client says yes, then we'll move forward. But if they're pie in the sky, then we're not the agent for them, that's not how we operate.

Veronica Morgan: Yeah.

Chris Bates: Well that's probably those doom and gloom agents you're talking about. They're probably going in there and saying, look, you do need to sell things could sell and you need to hit the market and they're just trying to get it on the market and they're probably over promising because once it's listed-

Veronica Morgan: Well, I actually don't think they do. It's a bit weird there because there's a typical agent that that hasn't been around very long. He thinks that's the only way you're going to get a listing is you go in and flatter the owner. But those doom and gloom agents aren't doing that. They're actually going in there and they're trading on the actual fee that look, I know you thought your place was worth a million last year, well it ain't, now it's worth $900K and if you don't get on the market right now, it's going to be $850k before you blink and you better hurry out, because your falling off a cliff, it's going to be worth $800k and it's just your race to the bottom. You need to get on the market now.

Veronica Morgan: That's what they're playing on rather than saying, oh yeah, you're going to get $1.1 and that's the conversation that's changing. I've been around, what? Nearly 20 years, and to be honest, and I've been around a few ups and downs and I've actually not seen so much doom and gloom from agents as I'm seeing now and hearing now, and I'm scratching my head, looking at them and going, you guys are idiots. You're basically, you're talking yourself out of a job. But not only that, you're actually talking out of your own experience right now. You're not actually pulling out of that at all and looking at what happens in markets, there are cycles. What happens if you've got a good asset? You're not actually being in any way discerning or giving that person good advice.

Veronica Morgan: Or you might have helped them buy the thing in the first place in 2015 and you know they paid too much. And you're basing your advice to them is like, oh, it's already lost this much money. It's actually, no, it didn't actually lose money, you just paid too much in the first place. You know what I mean? There's so many ways to have a more robust conversation around this stuff rather than, and I'm telling some very smart agents that I've always respected have been having these doom and gloom conversations. It's shocking me.

Chris Bates: Yeah. I mean, you've got to be extremely careful whenever you're getting advice from someone whose a doom and gloomer and the other way, someone who's always-

Veronica Morgan: Overly positive.

Chris Bates: Overly positive. And if anyone, if it's a financial advisor, if it's a doctor or whatever it is, whoever it is, if someone's giving you really doomful information, you've got to really make sure that ... And, it's a really short term business model because you're going to probably get it wrong. The market's probably not going to go as crazy as you think, and people love and it plays, and it gets people acting. So, whether you're sitting in front of an agent and they're being like that, my advice would be getting in front of other agents, right? And getting multiple points of ...

Chris Bates: Listen, I just want to reflect on ... I heard a bit of an interesting thing yesterday from a buyer's agent that real estate agents sometimes in areas, will buy market share by undercutting other agents for the first few months of the year to get runs on the board-

Veronica Morgan: You're talking about fees, selling fees.

Chris Bates: Fees, yes. So, let's say I'm working in, I don't know, let's just call it Eastern suburbs, right? Because I know Di Jones' got stuff in Eastern suburbs, but I'm losing out because I haven't got much market share. So, what I could do is for January, February, March offer 1% commissions when everyone else is offering 2% commissions, get some listings, get some runs on the board, get some buyers. And then, from March onwards I'll start going back to 2%. Have you heard of that happening in real estate?

Kylie Walsh: Yeah, for about the last 26 years. Look, I think in some markets that's definitely more active than other markets. I think the other thing too is it's a very dangerous place to go as an agent. If you put yourself as a bottom feeder, very hard to get out of that space. And I think there's other strategies that if you're launching a new area and you're an agent that you could work on it and it might be marketing packages or unique selling proposition or your commitment schedule that is a money back guarantee or something like that where you're not affecting your ability to earn an income. And people don't want the cheapest. I will argue this all day long, they want the best service, the best experience, know that they're going to have open communication and a great way to obviously tap into that is well what's been your past experience?

Kylie Walsh: And people are happy to, I believe, people are happy to pay a premium pay for service if they know they can be guaranteed of an outcome. Problem in our industry is how do you know that when you partner with someone from the start? So, we work with our guys a lot on money back guarantees, commitment schedules that we enter into. So, if we're going to put our money where our mouth is, then the client's assured of the result.

Veronica Morgan: Do you offer them money back guarantee on their marketing dollar?

Kylie Walsh: Yeah, look, we're open depending on each situation, but we leave that up to our agents to negotiate. But, like an example of one that we did yesterday was a client had, had terrible communication in the past and said that they were going to get calls the same day that they had an open, that we're going to be notified of every offer, and it didn't happen. So, we just went in and said, well, would you feel comfortable if every time we failed to deliver that or if we failed to deliver on that, it's X, Y, Z off your marketing on commission. And they're like, "Would you do that?" Why wouldn't we do it? Simple things rather than going in and prostituting yourself at 1.1 or 1.5 which the bottom feeders will do and they will always do and have always done.

Veronica Morgan: It's interesting you haven't actually then addressed their real fear anyway if you've just dropped your fee.

Kylie Walsh: Exactly.

Veronica Morgan: Really.

Kylie Walsh: Yeah.

Veronica Morgan: Yeah. It's interesting. You mentioned earlier that you've given presentations to Parliament House, what on?

Kylie Walsh: So, year before last, there was a few of us on the REI board and then a few industry leaders from across AustralAsia, that really believed that we need to change how the real estate industry is governed, and a lot of the legislation that goes with that and the professional development. So, we went and spoke at Parliament House around what we think we can do as an industry and what also a government can do to make it better for the consumer.

Kylie Walsh: So, it was a very lengthy day, it was about 12 speakers. I was the only female, which was great. From the point of view that I probably came across, a lot of the guys spoke about high level legislative stuff, whereas I was like a consumer just wants to know A, B and C, and they want to be reassured. So, talking about things like light, but maybe a hotline that can be manned by neutral party or maybe high level professional agents that have a barrier to entry are on there. And we take questions or Q and A, like this type of thing. So obviously, we've got the Real Estate Institute that lobby for the industry, but really who is out there lobbying for the consumers and yes you have Fair Trading.

Kylie Walsh: But at the end of the day, I think they've got ... The minister for our particular area has got such a big ramish. I don't know how he does what he does, but the fact that our industry turns over more than the mining industry means that we should probably take it a bit more seriously. And I don't know that I know what the answer is, but I think it's time to really have a look at it.

Chris Bates: Did the words Royal Commission get mentioned at all?

Kylie Walsh: Not at that time because there wasn't a huge amount of air time around it. It was just prior to that. Certainly it gets a little bit of air time these days, yes.

Chris Bates: Yeah. I mean that happened in threes, don't they? So, we've got the financial services, the banks, you've got aged care. I mean, I think this Opal disaster, and it's quite hilarious if you did listen to one of our previous episodes. Yeah, we mentioned Opal before Opal came out because they were doing things a little bit differently to some developers. But anyway, I mean Opal is just the canary in the coal mine really, so, and consumers want better answers. They want better products, they want better relationships. They don't want to feel like they're signing up to their biggest investment of their life as buyer beware. Basically you're buying a car sometimes they feel like, so I guess, do you think that would be a good idea to have a Royal Commission into property?

Kylie Walsh: Look, I don't know if another Royal Commission is the answer. I'm particularly blessed, I guess with clients when I was in sales that still ring me for advice now and family and friends that are very smart in great positions. But some of the questions they ask me about real estate, I scratch my head and go, really, you want to know that? And they're some of the smartest people I know. So if they want to know that, what does the average Joe blow want to know about real estate, and where are they getting that advice? Because a lot of people don't have people like us that they can turn to, to ask advice. So, I think there needs to be some service offering around that given it's such a large revenue chunk for the state government in particular, but where do they really go?

Veronica Morgan: Yeah.

Chris Bates: Yeah. I mean that's the problem is the government probably doesn't want it because it's such a large revenue raiser for the government. So, it's like, you're only shooting yourself in the foot if you start to bring regulation into property. And I think that's the big thing is that government are probably going to put themselves first over the consumers who are getting the poor outcomes because they're the ones holding the poor asset. Or, they're the ones who are losing buying poor assets, so they're the ones who are having to pay the stamp duty, and they pay a huge amount for a house and land package when they shouldn't. And so, there's so many things out there that I don't think the government really wants to ...

Kylie Walsh: Yeah. And look, it probably comes back to industry and there's a few of us trying to drive at the moment becoming a professional body just like you have for architects and solicitors and doctors and things like that, and that's a massive task. And there's about 12 of us undertaking that, and we've been working on that for two years now, and we'll continue to work on that.

Veronica Morgan: Yeah, we interviewed John Cunningham on that. I can't remember exactly what it was ... Within the first-

Kylie Walsh: Yeah. So, John is the driving force, he's the brain child. Yes.

Veronica Morgan: And which is fantastic. And I'm an absolute supporter of the pathway to professionalism from the industry, and a lot of the things that you're talking about in terms of your business align with that very clearly. I'm interested in actually your survey that you surveyed consumers out there and thousands of consumers. Is that a report that is available?

Kylie Walsh: No. So look, we've used that for the internal purposes. We are very big on our net promoter score and continuing to monitor that. And that was a part of that. We also wanted to see how competitors were performing in relation to response times. What came out of it was that consumers are very frustrated with agents response time to inquiry, and I just don't think that's acceptable, given the money that we're paid across the board, and we just did Metropolitan Sydney, that they're also sick of agents just showing them through houses was a big thing that came out. When they get to a property, they just want to go through the property and have a look at the property. What they want is more, as you said, advice around or guiding us as to where should we start. If we're going to bid at auction, what does that look like?

Chris Bates: I mean, I guess there's Warren Buffet’s famous saying, isn't it? When the tide goes out, you can see who's swimming naked and fundamentally right now you're going to see that, right? Because, the good agents, the response time is there, because there's not many buyers and the agents that were just rocking up and are open and could sell it, that's just not happening now. So, the agents have had to pick up their game. I imagine, so if you did this report now, I think you'd probably find that response time is probably much better.

Kylie Walsh: Yeah, we-

Veronica Morgan: I’ve noticed that in my business?

Kylie Walsh: We keep monitoring it, but I think you might get one response too if you go through an open home, for example, everyone gets fined on Monday, they'll get sick of being fined on Saturday. Certainly, we try and get our guys to do is have an eight point nurturing plan with buyers. So, if you meet a buyer for the first time and here's what the next date points of contact should look like.

Veronica Morgan: But there's these buyers and these buyers, right? There's people that are just looking at the house, and they're never going to be buying it. There's those that are never buying anything, they just love looking at houses, there's those that are just telling their actual search, and so it's just early days, there's those that go through it and never going to buy it because it's not right for them. And then there's a buyer who's buyer with a capital B, and we highlighted that, oh, they might be a contender for this property. You know what I mean? So I'm just drawing that distinction, you're not going to have an eight point plan with every single one of those people that go through a property, right?

Kylie Walsh: Yeah. I think, look, the question that we get as I said it's really hard, buyer or browsing. But that one question is really big for us. We also do a lot with subliminal stuff when people come through opens, things that we leave on the bench for example. So, if we know someone walked out with a blue folder, he's thinking about selling or different things and we say that in their hand that feeling.

Veronica Morgan: It's like little Asterix is going in the ...

Kylie Walsh: Little things like that. But again, one of the things that we try and drill into our team is go to client that we want at Di Jones, someone that owns a home. Are they selling now, or they're selling later? If they live in Sydney and they're at a dinner party on Sunday night, and they're talking about the experience that they had with Kylie Walsh at Di Jones. And it's the fact that she's contacted me eight times, in great. How was that experience? And it's going be awesome.

Chris Bates: I think that's a really smart way to do it because as soon as you start going down the other route, you can get it wrong. You've come across as a browser, you're not a browser, you're a buyer. And as soon as you start to assume, and you start to categorize people, you start changing your servicing offerings, and it's very easy to make a mistake because the buyer could be pretending they're browsing. Oh yeah, I live next door.

Kylie Walsh: And passive buyers pay the premium for property always.

Chris Bates: I've been-

Veronica Morgan: Let's just stop for a minute. This is the Elephant in the Room, passive buyers pay a premium for property always. I love this. Can you just quickly elaborate on that, and we might turn these into the buyer boot camp. Elephant rider boot camp for this episode, we haven't got to dumbo yet. We're changing the order a bit. Tell us why.

Kylie Walsh: Look, we still believe in print and look there's definitely a place for social for active buyers, and everyone's on real estate want domain on the major portals. But, research just shows us over and over again and our case studies that when someone sitting in a coffee shop on Saturday and they're going through, and they're like, oh my God, I love that house. I didn't know it was on the market. I've always wanted that property. Or they're looking to downsize and then an apartment catches their eye in print, and that, maybe I will sell mine and downsize, and they come to a property not what it is. But they're always the ones that pay a premium.

Veronica Morgan: And I think behind that is the fact that they happen to be browsing just not actually looking for property, and an image has caught their eye, and there's something that triggers the elephant within. But somebody who's actively looking, will be constantly valuing and assessing anything that they see and putting it into context of everything else that's around because the buyer, the passive buyer who's just browsing and happens to trip over something that just really appeals to them, they haven't had the time or that background or that investment in their own search up to that point. So therefore they have no relativity. Is that pretty much what you're saying?

Kylie Walsh: Yes, a lot of the time. And I think also too, it's what I said, if sometimes people go, I wasn't aware that that was on the market because I'm not searching the portals. But it's like we see so many buyers pay premium, see a property for auction 72 hours prior. And over the years I've had a lot of green agents go, oh, they wouldn't possibly buy it, it's on the day prior, the morning off. And I'm like, yeah, they're the ones.

Veronica Morgan: They do.

Kylie Walsh: That's your buyer, go, and show them.

Chris Bates: Yeah, I mean it's double whammy sometimes. So client bought a property in Lilyfield just before Christmas, but I threw buyer's agent and then that basically-

Veronica Morgan: Not through us by the way.

Chris Bates: Not through Good Deeds. And they knew the buyer's agent before they met me, and the reason they got that property was interesting because that property was never on the market. They bought it off market. But the reason that property came on the market was the seller had found their dream home and then thought now is the perfect time to upgrade the property that they wanted to buy was going to auction that next weekend. And so they weren't going to sell their property unless they sold it before the weekend. So on the Monday they listed their property for sale, they sold it on the Tuesday for a discounted price without doubt from what is going on the market. And then on the Saturday they bought another property for more expensive than probably that was worth because they got so excited, they then bought in the auction.

Veronica Morgan: Oh that's a golden flawed thinking, that's just double whammy isn't it?

Chris Bates: In seven days you look at it-

Veronica Morgan: Over paid and undersold.

Chris Bates: Overpaid and under sold. And it's like, wow. And so then what they must have happened is I don't, they might have been driving past the property banks or the for sale sign and didn't realize it was sale. But within a week that's sold and bought, and they probably lost out twice. I was just like, wow. Obviously you weren't an active buyer. Obviously, you didn't know what your house was really worth, you didn't know what that was really worth because you just cut yourself out hundreds of thousands of dollars.

Chris Bates: Every week we hear incredible stories of the dumb things property buyers do, dumb things that end up costing a whole lot of money and or creating a whole lot of stress, mistakes that can be avoided. Please Kylie, can you give us an example of a property dumbo? We can all learn what not to do from the stories.

Kylie Walsh: Yeah, look without names or suburbs or dates or times, something I consistently see is my absolute classic favorite is my sister said, or my brother said, and someone has been looking for three months, six months, nine months. They've found their dream home. They've got a list of 10 things that suit them, they tick off eight. You're not going to find better than that, it's amazing. And they put in an offer, we're negotiating back and forth, and I wrote to my sister, he's a nurse, well she's a teacher, nothing to do with real estate. And then they take the advice of someone outside the industry for their dream home for their family for the next however many years.

Kylie Walsh: And I've seen person after person miss property and I'm run into them five years later and they're like, I cannot believe we didn't buy Smith Street in Paddington. It's still our dream home. We should never have listened to our sister or brother or uncle or whatever. I think you can get too much advice when you're looking to buy. And it just had those people that you really believe in, and you trust and you've done your research, you don't need to talk to everybody about it. If that's the property that you want, and it ticks the boxes, or it ticks 80% of the boxes, buy it because you're not going to do any better than that. And as I've said before, in 10, 15, 20 years time, it's irrelevant.

Veronica Morgan: But also, it taps back into what we discussed in Episode 46 with Lorna Patten about this idea of not good enough. If I don't really feel that I'm good enough to make that decision all by myself and it's a big thing, let's face it. But really, rather than go to other people and just seeking reassurance from people that really don't know any better than you, in fact, don't know as much as you.

Kylie Walsh: Or don't even own property.

Veronica Morgan: Yeah, or that too. Don't seek reassurance from those type of people. Go and get advice from a professional.

Kylie Walsh: Exactly right. And you see it time and time again.

Veronica Morgan: Yeah.

Chris Bates: And unfortunately a lot of that time you want validation and you don't get it. And then they, unfortunately, that's easy for them to say yes. And sometimes they say no, have you thought about this. And they just start that element of doubt and then they can sleep on it and that. You're right, they start to act completely emotional. The problem is, is what wedding planning does to you. You, realize that if you ask for an opinion, you got to hear it and if you don't like that opinion you've already asked for it. And so now you've got to tell that person why I don't really appreciate your opinion. And so it's this situation again, you've asked your sister or your mother or your brother or your friend at work, what do you think of this property? And then they say, I don't like it.

Veronica Morgan: Doesn't really help you, does it?

Chris Bates: Well, it doesn't help. And you've now got to say, hey man, I still bought it. I still bought it.

Kylie Walsh: More noise, more noise.

Chris Bates: And you've just created. So you've got to be really careful when you ask for opinions and make sure that if they do give their opinion, it's coming from a good place and it's actually valid because you're probably creating more mess than ...

Kylie Walsh: And I think putting it into perspective, I watch people, guess I'm a loser. But, at Harvey Norman, Good guys on the weekend and I see them negotiating on a TV or a fridge and I look at the percentage that they're negotiating over for that product and as we're settling to the total price. And I think it's funny, a lot of people do more negotiation over fridge and a TV and in my opinion, pay more of a percentage premium than what they were going to pay than they will for a home.

Veronica Morgan: Yes. In fact, one of my old colleagues, years ago she turned to me one time, I still remember these ... She got off the phone after talking to a buyer and said, oh my God. Some people spend more time researching a toaster than they do a house. So, the flip side of that is when they don't negotiate at all, when they just completely fall in love and are blissfully unaware of anything that could go wrong. In they go, you've got to love buyers like that, don't you?

Kylie Walsh: Yeah, absolutely. And I think, just understanding what the trend is, don't look at the last 12 months or the next 12 months is if you're going to live there for 10 or 15 years, have a look at 10 or 15 years and what that looks like. So-

Chris Bates: Problem is that will stop your negotiating, because you'll be like, oh well that's going to go up. It's gone up so much, so you start to go, oh actually it's made up. It's gone up 150% in the last 10 years. And then you go, oh yeah, I don't really needs to get a good price today. And then that's going to face the purpose of negotiation, right? You've got to be like, well I've got to...

Kylie Walsh: I mean, I'm just looking at myself for example, and I'm pretty experienced in the industry and even we make mistakes and listen to noise. So there's a house in Tilton road in Willoughby that in 2011 I should have bought. And the agent at the time that I was talking to is like, it's so close to the city and this is what I'm talking about areas that are popular and we'll never go through the floor and they'll stay stable and that property I could have bought for $1.67 then and it's $3.6 every day of the week now. So, I think it's relative and people just can't be shortsighted is probably what I was saying in their investment and what they're going to pay. But yeah, stop getting so much advice. If you like it, go for it. It's always a good time to buy if the property is right for you.

Veronica Morgan: Yup. Yup.

Chris Bates: Get a good buyer's agent.

Veronica Morgan: You could do that too of course. Now listen, thank you so much for your time Kylie, it's been very interesting chat. To be honest, I think we started off and I thought we were going to be really just talking about really men and women in the industry and how you've seen changes over the years. And I had a whole bunch of questions here, but instead we covered ... Oh, what did we cover? God, we talked about the bush, we talked about transparency, we talked about consumer expectations-

Chris Bates: Technology.

Veronica Morgan: Technology. We talked about where the industry's going, we talked about legislation. We covered an enormous gamut and really appreciate your time and your frankness.

Kylie Walsh: Thank you. I've had a ball.

Chris Bates: Thank you, cheers!.

Veronica Morgan: Don't forget that you can access the transcript for this episode on the elephantintheroom.com.au. And don't forget to download our free Fool or Forecaster Report, which experts can you trust to get it right. Get the report and find out.

Veronica Morgan: Please join us for our next episode where we interview Karen Stiles, who is the executive director of the Owner's Corporation Network. Now the Owner's Corporation Network or OCN, is a body that is in existence to help represent the interests of strata owners. And why do they need representation? Well, listen to this episode because Karen has some very interesting stories that illustrate why owners are buying into a system where everyone else seems to know the rules but they don't. Now, I'll let that hang there because it's a really important episode all about the risks of buying a strata property. Now we're not bagging strata property, but you need to know the risks and it's a very, very enlightening episode.

Chris Bates: Don't forget, we're on all the social channels. We're on Facebook, we're on Linkedin, we're on Twitter.

Veronica Morgan: Or you can connect with us on theelephantintheroom.com.au, the links are all there for you.

Chris Bates: Please connect and send us a message we'd love to hear from you.

Veronica Morgan: The elephant in the room property podcast is recorded at the Sydney Sound Brewery. This week's podcast was recorded by John Hresc editorial by Gordy Fletcher.

Chris Bates: Until next week, don't be a dumbo.

Veronica Morgan: Now remember everything, we talked about on this podcast is general in nature and should never be considered to be personal financial advice. If you're looking to get advice, please seek the help of a licensed financial advisor or buyer's agent who will tailor and document their advice to your personal circumstances with a statement of advice.



Veronica Morgan