When Bill Rawson, Chairman of the Rawson Property Group, was asked whether he was concerned about recent statistics showing that since 2008 the residential property market had contracted by 45%, he surprised his audience by replying, “not at all”.
Rawson went on to explain that the position of his and similar big groups had, in fact, been strengthened by the elimination of a large portion of the opposition who, he said, are “simply not here today”. By contrast, the Rawson Property Group has now achieved a year-on-year growth of almost 40% for some three years.
The reduction in the number of estate agencies serving this sector, said Rawson, is good for the market because those groups who have come through the downturn are almost always the ones which provide a comprehensive support structure to their franchises – or in some cases branches – which, in turn, works to the benefit of the consumer.
A comprehensive support system, said Rawson, should include on-going media marketing, continual training and skills improvement programmes, regularly updated websites, the provision of easy access to relevant property data (on both a national and a regional level), a nationwide referral system and a range of ancillary services such as letting, bond origination, property management, property maintenance and investor advice.
“Many of those agencies which have dropped away,” said Rawson, “would have liked to have provided these ‘extras’, but they could not afford them. The awkward truth is that a full support structure is expensive, but the good agencies have grown sufficiently over the years to be able to afford it.”
There will always, Rawson added, be room for the small dedicated area specialist agencies, but the downturn has reinforced the ability of the major groups to grow and spread themselves nationally.
Asked by some of his audience why, if this is the case, some big agencies are growing faster than others and some are still reducing in size, Rawson said that it has been agencies that were already strong in the lower middle and lower brackets that have benefited most in recent years. Rawson said that in his group 18% of the agencies are now black owned and run and a high percentage of all his franchises now focus on the sub R1,2 million bracket. National figures recently released indicate that the demand for homes priced below R1 million is nearly four times as strong as demand for homes in the R1,5 million plus brackets.
