As of 1st January 2019, there are 29,146 licensed property agents in Singapore.
We are in a highly regulated industry in Singapore with CEA as the government statutory board that regulates all our behaviour.
About 30,000 agents serving this tiny island of Singapore.
What does that tell you?
The 80/20 Rule
Have you heard of the Pareto Principle? Based on this, it means only 20% of agents are actually taking 80% of the listings. And the remaining 20% of the listings are spread across the various 80% of agents.
Some agents choose to specialize based on area – for example focusing on Sengkang or Punggol areas.
Some agents choose to specialize based on the demographic segments eg HDB upgraders versus luxury segment.
Even those agents who choose to specialize in the commercial segment will go even more deeper – eg CBD offices or industrial property units.
That’s why to succeed in this industry, the need for specialization is important.
I know agents who do very well just by focusing on a Single Residential Condominium or office building eg International Plaza where individual office units are owned by investors or business owners themselves.
The transactions happening within the development is enough to keep the handful of specialty agents busy.
Challenge #1: Knowledge Being Siloed
Due to the wide variety of property types and customer demographics, this has created knowledge silos.
You will get agents who are very knowledgeable in areas like Sengkang and Punggol but might not be aware of a property micro-trend happening in Bedok or Tampines.
If you talk to a property agent specializing in luxury residential properties – they might be clueless if you asked about a HDB negative cash sale.
Did you know that a good property agent will adopt different selling strategies for selling a new launch property versus a typical Resale HDB flat?
Certain in-depth knowledge are required in order to succeed and do well in this industry.
How do we overcome this challenge?
In order to equip ourselves with the required in-depth knowledge, it is very important to seek out the correct mentors or leaders in our real estate industry who can provide suitable guidance.
For my company OrangeTee, we adopt a culture of sharing knowledge – no matter how small the knowledge might be.
If there is an issue that I personally can’t solve, there is a network of leaders and agents whose knowledge I can fall back on to tap on.
For me, I am often asked to share my knowledge and experience with other fellow agents to provide updated insights in the property trends.
If we are not meeting clients, we will be busy attending trainings organised both by our team leaders and external trainers .
As a self employed , we have to upgrade ourselves from time to time to stay relevant in the industry and more importantly to serve our clients better .
The days of “keeping our knowledge for ourselves” is over.
Challenge #2: We Sometimes Know Too Much
These regular trainings and sharing sessions with fellow agents are very effective as it is done regularly and in small groups.
This has resulted in an interesting dilemma for us property agents.
As agents, we are trained to help our clients buy and sell their properties.
But because our knowledge continuously expands and compounds, we begin to pick up the small nuances that can make a significant impact for our client’s futures.
For example, I am tasked to help a client to buy a 37-year old HDB flat. He really likes the flat and it suits his budget. He is also aware about the issue of HDB depreciation.
On the surface – it is a very easy transaction to make. The client is happy, I handle the paperwork and make arrangements with the seller. I then make my commission and I move on to the next deal.
But I know in 5 years time, he might regret the choice.
- Do I tell him how hard it will be to sell next time if he wants to let go because it would have become a 42 year old HDB flat?
- Do I tell him that a fellow agent recently transacted for a similar sized flat at $60,000 negative cash sales? It is not nearby but within the same district.
- Do I tell him to consider other choices?
So how should I proceed?
Tell him all the (potentially) gory and painful financial distress that might happen and walk away with no sale?
Or say “yes sir will proceed to close the deal for you” and I get paid?
It is not easy when you know a lot because of experience. And you have seen many transaction data.
By the way, buying an old flat that is cheaper is actually not a bad idea if the buyer is close to retiring and has no plan to buy another. He has the option of utilising the Lease Buyback Scheme.
But I would highly advise against it if the buyer is a young couple buying their first home.
So it really depends on the buyer’s needs and future goals.
Overcoming this challenge
The only way to overcome this is by being upfront and honest.
And the honesty has to come not just from the agent’s side but from the client’s side as well. Clients have to be honest on their goals for their future.
But the only way to achieve those goals is by having a clear financial overview of where they stand.
That’s why having a no-obligation consultation session is important where I can do a detailed financial evaluation on what you need and what you are able to do.
In order to balance my knowledge with my client’s needs/goals – the key ingredient needed is trust.
Challenge #3: This Is A Trust-Based Business
In my 13 years of work in the industry, I used to serve many landlords because it was much easier to get a tenant than a buyer.
I started out by sourcing tenants for landlords by focusing on the rental market. Through this process, I got to know more landlords and property owners.
Along this journey as a property agent, I eventually realised it’s not only about just receiving commission from landlords.
Managing tenancies requires a very robust and consistent follow-up process which a lot of agents do not realise or have the patience to do it.
Managing Tenancies Is Tough Work
Even for myself, I have to admit it is not easy and requires a lot patience to manage tenancies without getting paid.
However, it is that constant follow-up process that clients:
- get to understand you more,
- get more comfortable with you and
- eventually trust you to give you more repeated business and referrals.
The trust is hard-earned and hard-won. Some agents weather this process well but there are plenty who drop out.
At the same time, there will be some landlords who might not appreciate what you have done for them. Some even take advantage of you since they know how and even squeeze you dry.
Quite painful but I learnt how to manage such landlords as well 😉
Till date, some of my clients who are still with me – still entrust their properties to me to manage their tenancies.
It is tiring but it’s rewarding and fulfilling – especially when clients appreciate what I did for them. Eventually, they gave me more business to handle.
For example, I got to know this client back in 2007.
I was entrusted to sell their 3-bedder unit at GardenVista in 2007 and it was sold within a month due to the market upturn.
To my surprise in 2009 – they called me out of the blue to rent out their 3 bedder condominium in Bukit Timah Road. In 2014, they called me again to rent out another property at Newton area.
Till today, I’m still managing their tenancies.
Recently, they entrusted me to sell their landed property at Thomson for which I got them a good price.
The clients mentioned above is one of the example whom I got repeated business. There are many others like them whom I’m still serving till today.
How do we build trust effectively and consistently?
The key process of trust-building is by adding value and/or creating value.
This challenge is not unique to the property industry – it is faced by a lot of other similar service-based businesses.
I create value by sharing my insights and knowledge through this website and sharing my blog posts.
I add value by planning my client’s property investment roadmap and advise them of the potential pitfalls and risks of their upcoming property investment transactions.
Even by helping to change a flickering lightbulb at a tenant’s home is my own simple way of adding value to my clients.
To build trust, I cannot just focus on closing deals. Instead, I have to focus on opening new relationships as well.
End of the day, this is a service oriented business which is a highly competitive business locally. We have to be a people person.
It is more about a commitment to developing the skills for connection than it is about having natural style.
The benefit of my 13-years of experience has helped to transform simple transactions into potentially lucrative investments for my clients who placed their trust in me.
However, knowledge and experience by itself is not enough.
I realized that this business is about integrity, credibility and more importantly empathy grounded in a commitment to add as much value as I can for my clients.
Ready to learn about how I can add more value to your property portfolio? Contact me to arrange for a no-obligation honest discussion.