SKILL: Pam Golding Properties CEO Andrew Golding says real estate journeys often start on the web, but contact is then made with an agency. Picture: SUPPLIED
SKILL: Pam Golding Properties CEO Andrew Golding says real estate journeys often start on the web, but contact is then made with an agency. Picture: SUPPLIED

The human touch still reigns supreme when it comes to selling houses, says Pam Golding Properties CEO Andrew Golding.

“People still want a warm body when they buy or sell a house, which is a highly emotional deal”, said Golding. He said suggestions that human agents have no future are misplaced, with 70% of successful house sales conducted using traditional methods in SA.

More black South Africans are entering the residential market than before, making up 60% of first-time buyers on a national scale. Most of these buyers want to buy a house using an estate agent, Golding said.

Many technology providers have said estate agents’ careers will end in the next few years as they expect customers to use applications such as FNB’s nav, which allows an FNB customer to sell a house to another of the bank’s customers without an intermediary.

Golding criticised the bank’s innovation, saying it does not take into account the intricacies of a house sale.

“I’m not sure what FNB is trying to achieve. There is schizophrenia around what the point of what they are doing is. It can hurt the industry,” he said.

Golding said recent innovations that are supposed to cut out the middle person in house sales do not always add value. Buyers and sellers still want to deal with trusted agents. An application that let them view a property in virtual reality or buy a property via an auction may be useful, he said, but there still needs to be an agent to deal with disputes about price and other issues.  

He said he believes 20% of the total residential sales market will make use of a technology app for real estate transactions in the next few years. 

Another national estate agency, Seeff Properties, said there is space for human estate agents and they should repackage their services to compete.

Seeff national marketing manager Ted Frazer said: “There will always be those segments of the market that are confident enough and prefer the ability to manage their own transactions and platforms such as online agencies or applications, but these are likely to remain limited and of no real threat to the market.

“We are looking at adopting the very best tech innovations that can similarly equip our agents to provide a better real estate service experience to our clients,” he said.

Commenting on market trends, Golding said that like many sectors, the housing market is feeling the effects of the deteriorating economy. Political uncertainty has also dented market performance across SA.

“The year began on an optimistic note, with high expectations of a positive economic outlook as a result of [Cyril] Ramaphosa’s election as SA’s new president. However, as the full extent of the economic cost and fallout from years of state capture became apparent, business and consumer confidence slumped,” he said.

House price inflation slowed from 4.72% in December 2017 to 3.99% at the end of September 2018, according to Pam Golding Properties research.

andersona@businesslive.co.za

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