Auctions, Transparency & Government Intervention

Transcript

Peter Fletcher

[00:00:00]
Peter Fletcher: Welcome to the WA Property Q and A, the podcast where I explore the ins and outs of buying property in Western Australia. I’m your host, Peter Fletcher, and each week I interview local property experts to help you to develop a deep understanding of the nuances of buying property in wa. From market trends to legal considerations, no topic is off limits, but before we dive in, a friendly reminder, while we provide valuable information, it’s important to note that nothing discussed in this podcast should be construed as personal investment advice.

Always remember to seek the appropriate professional advice for your specific circumstances. Now, let’s get started and unlock the secrets to successful property buying in WA. Welcome to another episode of the WA Property Q and A podcast. And with me today is none other than Robert Manchi, vice President of Rewa, principal of Paddington Realty [00:01:00] Real Realty.

Is that right? Yes. Yes. Good. And ex Victorian still a Carlton Blues fan, but we won’t hold that against him for too long. Welcome, Rob.

Rob Mandanici: Thanks, Peter. Thanks for having me.

Peter Fletcher: You’re welcome. So what’s on the agenda for real estate this week?

Rob Mandanici: Busy week, I think that almost final run towards Christmas and the end of year.

So just pulling a lot of I won’t say last minute deals together, but you know, a lot of people who have had that thought going, oh, we need to get that done, or let’s get that on the market, or let’s get that off the market. Or you know, let’s get that lease done. So there’s been a bit of that this week?

Peter Fletcher: Mm, so far. Mm-hmm. I wanted to talk about Rob, because it sort of caught my attention and interest, is this idea coming out of Victoria, of mandating the compulsory disclosure of the auction reserve price prior to auction day. You, you’re a Victorian, you’ve had a lot [00:02:00] of experience in this space.

What’s your thoughts? What are you hearing around the trap?

Rob Mandanici: Look, I think and I think we clarified that ex Victorian now.

Peter Fletcher: No, you’re still a Victorian in West Australia. You’re still Barrick for

Rob Mandanici: Colton. And much to probably, much to your fans discussed. Not doing much better than West Coast this year.

I think so. We’ll, we’ll see how that goes. Someone said to me the other day, if might’ve been you, if you finished 14th you I’ll be happy if West Coast finished 14 this year, I’d probably be happy with a 14 as well for Carlton. So, let’s see how we go there. But yeah, talking about Victorian auctions or auctions more broadly, I think I think the government intervention here I think is a bit of an own goal.

And I know I say that a lot about government intervention, but this one here, I think people might finally, this is the

Peter Fletcher: Victorian intervention. Yeah. Mm-hmm.

Rob Mandanici: Yeah. I think people might finally realize that auction isn’t the big evil that everyone says it is.

Peter Fletcher: Mm-hmm.

Rob Mandanici: And think about it in its purest form.

You take [00:03:00] 15 or 20 people and we all get out on the front lawn on a Saturday afternoon or a Saturday morning, and one person stands at the front calling for forbids. You don’t get more transparent than that. So if I’m standing in the crowd and you are standing in the crowd. I know what your maximum is on the day.

Now it may not be all you were willing to pay, and that’s a slightly different argument here and we’ll get to that one. But from a purchaser’s perspective, from a buyer’s perspective, it’s open, it’s transparent. I’m sitting there going, well, Peter, or I dunno if you, Peter, it’s this guy next to me, he’s at a million bucks.

I don’t wanna spend any more than a million, so I’m out. Peter gets it. Or if Peter’s making all the noises and agitations that at a million bucks, he’s looking stressed and he’s looking like he’s at his wit’s end and maybe his partner’s tugging on his arm saying, don’t bid any more. Don’t bid anymore.

And then you are standing there, you know that maybe another $10,000 will do it or $5,000 will do it. I think what disclosing the reserve [00:04:00] does is it’s gonna take away. I think that transparency, and I know that might sound a little, a little strange in that the governments come to this decision in the efforts of transparency, but I think what it’s gonna do is it’s probably gonna push auctions down a little bit, I think, and I think buyers and sellers might just opt more to towards private treaty methods.

Peter Fletcher: You mean sellers will opt,

Rob Mandanici: correct. Opt towards? I think some degree that’s gonna force, you know, buyers into that mindset of avoiding auction, perhaps even more than some do. Yeah. I think that’s probably where it’s gonna go.

Peter Fletcher: So some time ago there was this, when a property reached reserve, the auctioneer would announce the property is on the market and will be sold today.

Correct. And then there was a, a group of auctioneers that said, well, there is no requirement for us to disclose when the reserve had been met. [00:05:00] And so you had this the people in the audience. Well, is it on the market? Is it not on the market? And the auctioneer would say, you just need to make your highest and best offer right now.

Because when I, you know, when I the gavel comes down, it is sold, it kind of forcing people to disclose the reserve takes that whole conversation away because now everyone knows when it’s hit the reserve. Is that a bad thing? Why would that be a bad thing?

Rob Mandanici: Look, I think, I think having that disclosure at the point of auction is important.

Peter Fletcher: Mm-hmm.

Rob Mandanici: So in the heat of the moment, I think it is very important for the auctioneer at the point when the reserve has been met. Mm-hmm. Is to give that signal that we are on the market. Mm-hmm. And I think that’s important.

Peter Fletcher: Mm-hmm.

Rob Mandanici: That’s important for a number of reasons, but

Peter Fletcher: So could you say that that should be legislated?

Rob Mandanici: Yes. Right. Hope so.

Peter Fletcher: There’s gonna be some [00:06:00] agents hate you now. Mm oh,

Rob Mandanici: Absolutely. And I think that’s an important distinction. I think that’s an important distinction. And there’s plenty of ways to control the crowd. And the crowd will always want to know. Bidders will always wanna know, are we on the market?

Mm-hmm. And they’ll do everything. During the conduct of that auction to find out, because it’s human nature. So there’s a little bit going on there, I guess, in the buyer’s mind. And someone in the crowd will think, well, as long as I know when we’re on the market, I’ve got an advantage over the next person.

And I think that that’s just human nature. We’re all like that. No one wants to overpay. Mm-hmm. Fear of overpaying. And I think you often get that after an auction. The buyer or the, you know, sometimes the under bidder might be relieved going. Oh wow. I really got pushed and I’m so glad I didn’t go that extra little bit.

Peter Fletcher: Mm-hmm.

Rob Mandanici: But you know, at times you’ll, you’ll have the bidder as well, maybe sometimes questioning did they overpay. So I think there’s human nature in wanting to know, are we on the market? I think however, taking that a week out is really going to take the sting out of the campaign and may actually result in properties not being sold [00:07:00] at auction.

Both slowing the whole process down.

Peter Fletcher: Mm-hmm.

Rob Mandanici: But also. Again, in the buyer’s mind returning to private treaty, and I really think we’ll see a push to private treaty. Now, a totally opposite scenario to the auction is the private treaty. Now there may be a push there you know, to go sort of delve further campaigns, you know, may get longer.

Does that necessarily result in what the government’s aim is here? And my understanding the government’s aim here is. To address the housing crisis this way, potentially to make home prices cheaper, and I just don’t think changing the method of sale is gonna change that a good agent, regardless of the method of sale, is still going to extract a premium price for that property.

Peter Fletcher: So Rob, would you be happy with a compulsory disclosure of the reserve price during the auction?

Rob Mandanici: I think once you’ve hit the reserve, I’m comfortable. That [00:08:00] be declared.

Peter Fletcher: Okay.

Rob Mandanici: And from a personal position, I’m comfortable that that reserve be declared.

Peter Fletcher: So it has to be declared

Rob Mandanici: a week out. However,

Peter Fletcher: what about

Rob Mandanici: if it’s a campaign killer,

Peter Fletcher: if you would accept that it had to be dis declared when it hit the reserve.

Would you be willing to say that it had to be declared at the start, prior to the start of the auction? Immediately prior to the start of the auction? Say in the preamble?

Rob Mandanici: No,

Peter Fletcher: no, no. Mm-hmm.

Rob Mandanici: No. Very comfortable. Once the reserve is hit. Mm-hmm. Not before. Mm. And whether that’s 10 minutes before mm-hmm.

Whether that’s in the preamble of terms and conditions and special disclosures. Or whether that’s a week or two prior. Hmm. But remember we are also seeing that, or we have continued to see that shift in Victoria and other jurisdictions around pricing and pricing models and how a property is priced.

How we [00:09:00] arrive at that price. Hmm. And how we market that price. So, I’m not surprised that they’ve gone down this path in Victoria specifically. You know, when you look at other methods of sale, private treaty tender, et cetera, around how the price is positioned you know, price bans offers from all that kind of marketing and how that’s changed over the years.

Peter Fletcher: You, you said before that it might be an own goal. I suspect you could be right. I just heard of a an instance in one of the far northern suburbs of Perth, right? We are talking about as far from Perth as you can go before you hit Geraldton. It’s a long way out, and the agent was saying that there is that.

They had it on the market in the early sixes, thinking that they’d get in the mid. So 6 50, 6 60 [00:10:00] offers came in at that plus and and then some rolled up to seven and then someone came in at seven 50. Seven 50. Rob. Now this was because there’s no transparency at all, like all that, that that successful offer bid against themselves didn’t have to go that high.

As you said before, if they were standing on the front lawn going toe to toe with someone else, they would know that, well, all I ever had to do was pay. Like 7 0 2 for it.

Rob Mandanici: So, there’s a great example and there’s a couple of reasons, obviously in Perth, very different market conditions, why that might be happening.

And firstly, an abject lack of stock. There’s no doubt about that. We, you know, every few weeks we keep hitting record lows in terms [00:11:00] of the stock availability, record highs in terms of turnover. Outside of that, in some of those far outer suburbs, there aren’t enough sales. So there’s not enough sales data sometimes for an agent or vendor to quantify what a comparable is.

So that does make it challenging. And then you’ve got the fear of missing out. So we flip from fear of overpaying to fear of missing out. So you do see that from time to time. The question there, of course being, and that’s the unintended consequence. I think now, if that were an auction perhaps that buyer may have paid a lot less and that vendor may not have been as happy.

And it is a fine line. But just remembering most of the time for those of us that act for a vendor, our job is to get the best possible price for that vendor. That, that is our job. And as long as I think it is done in a way that can be transparent. And I’m not saying our offer and acceptance format of selling isn’t transparent.

We’re going to a vendor with information, with comparables or in cases like some of these far suburbs. Where there’s a lot of new constructions and very few resales,

[00:12:00] quite often we are going to both the vendor and the buyer and saying, there isn’t a lot of data and we’re saying to the buyer, and I’m seeing this from a lot of agents saying, you need to tell us what you are prepared to pay.

Mm-hmm. They are setting the market. Mm-hmm. These outer suburbs, the vendors aren’t setting the market. The buyer is setting the market well and truly.

Peter Fletcher: Yes. Yeah, that is fair to say. Hmm. So as much as you you are saying that you as a selling agent is there, are there to act in the seller’s best interest and in the strict reading of the Real Estate and Business Agents Act, you are, you also have a duty to act like not act unconscionably and to be like. I guess fear, where does all this, you know, buyers bidding against themselves fall in this sort of sense of fairness in our [00:13:00] society?

Rob Mandanici: Yeah. Look, I think.

Again, ultimately, you know, coming back to methods of sale, and this is where perhaps at least in the Victorian case, it may be an own goal in that, you know, auction does provide quite actually a high level of transparency. And there’ll be people who’ll say, oh yes, but auctioneers take bids from trees and buses and anything that goes by, look.

You know, I don’t think a lot of people are gonna deny that that didn’t happen once upon a time. Yes, it did. There has been very strict penalties in place for a very long time around that. And I think anyone who conducts themselves with that behavior today, you know, would be marched out of the industry.

And, you know, anyone who’s got any allegation of that should go and have a chat to the relevant authorities. And I don’t think any reputable agent has time for that. And you know, certainly don’t. It’s a reputational killer. No one wants to get into that sort of thing. I think, ultimately it really is though about being fair, as you said, with the buyer as well, because we do have a duty, but we also wanna leave both parties with a smile on their face.

You wanna make your vendor happy, you’ve gotta achieve a good price for [00:14:00] them, and you wanna know that, you know, you’ve left nothing on the table for them. But ultimately, and I think it’s just about being straight with the buyer and saying to the buyer that offer’s not gonna cut it. Mm-hmm. Yes, Pete, you, you are.

Gonna increase your offer against yourself, and you might be the only buyer. But we do have other buyers, but we have said to every buyer, you need to do better.

Peter Fletcher: Rob you. You say that you would like to see people have a, both parties have a smile on their face, and that’s. that is so admirable and almost cute.

I almost wanna hug you, Rob.

Rob Mandanici: Not always possible.

Peter Fletcher: But I regularly come across agents who. When asked the question well, what’s your price guide? And they say something like, clever, like, well, the, the property has only just hit the market. We are being guided by the market. You know, what’s your budget?

And you know, it, it’s a way of saying nothing without, and then sucking some [00:15:00] information out of the buyer and then sort of. Kind of setting them up to think that maybe the property is worth, you know, maybe they could get it for seven, when actually it’s nine 50. And you never actually said that you could buy it for seven.

It’s just the way you phrased it that led someone to believe that that was. Might have been possible. And I see a lot of a lot of agents doing this and I thought that they’re trained in these scripts and dialogues that, that do elicit that kind of belief. Is there something we can do there to stop that?

Well, we never actually said, we never actually gave a price guide, but people actually believed it. The price was much lower than it was.

Rob Mandanici: Yeah, look, I mean, personally I’m a big fan of when there is, you know, market data to support a price. It is generally either to give a range or a from price.

And I think that’s important. And. I find, and [00:16:00] maybe it’s some of the markets that I operate in, quite often the buyer will come to me wanting to make an offer under the, from price. And from that point of view, it’s a different education. It really is having a discussion in the Bluntest terms saying, look, he’s from that, you know, we are not gonna get anything under that.

The vendor has said very clearly, we’re not accepting anything under that. So I think it starts with the conversation with the vendor, understanding their expectations, where they’re at. And I think at the end of the day, you do have to be transparent with the buyer. I get that that script or that particular dialogue probably is more of a phishing exercise to understand a little bit about that buyer.

You know, there might be better ways to go around that. Personally, I think so. I think at the end of the day, you work out pretty quickly if something’s not in their budget. I think that’s a pretty there’s some effective ways of doing that. And if we tie that back, I think to what’s happening in Victoria, a little bit of what they’re doing is because of that guidance in that, you know, and again, we’re talking in particular less seasoned purchases, first home buyers perhaps, or even second home buyers.

And I’ve always gotta remind [00:17:00] myself, we do this every day. So our terminology, the way we do things, it comes easy to us to a buyer and a seller who may only transact a property once or twice in their entire lifetime. We’ve gotta keep reminding ourselves for them, this isn’t easy. It’s confusing and it’s complicated.

And I think a lot of what’s been going on in Victoria and other states in particular has been not necessarily, and we’ll just step back and say, I did say earlier. Maybe to do with the price itself, but quite often to do with the cost of purchasing a property. So, you know, you’ll have situations where a buyer may have been led down a certain path that a property was within their price range, and in the Victorian case, distinctly different to WA before they bid, they will go and do.

A building report, a building inspection, a termite or a timber pest inspection. Get quotes, do a whole heap of things, get their finance, engage a broker or a buyer’s agent, and spend a considerable amount of money only to turn up to an auction. Quoted at, [00:18:00] say from seven 50, the bidding opens at eight 50.

That is very distinctly different to a competitive process in Western Australia where we can make an offer subject to our whole raft of conditions and not incur those costs until we know. We are 100% in with a chance. Mm. That is a distinct difference, I think, of our system and every other state in the country.

Mm-hmm. Mm-hmm. And probably, well, not probably, I think we’d say with absolute certainty, it’s why auctions aren’t as popular in Western Australia as a method of sale.

Peter Fletcher: Mm-hmm. Mm.

The auctions have such a great, and I’m talking on street auctions. It’s theater central. I actually don’t mind, you know, sitting there on a Saturday afternoon on instruments watching the different auctioneers that apply their trade.

It’s a bit of fun.

Rob Mandanici: We’ve got some great auctioneers and I think, look, even in Western Australia, we’ve got some fantastic auctioneers and we’ve got some agencies that do auction well. And in their [00:19:00] markets it works. Mm-hmm. And in some markets it works a lot better than others. And look, they’ll tell you that as well.

And I just think that you know, ultimately. Again, coming back to every property is different. Every purchaser and every seller situation is different. In certain suburbs that I operate in, I wouldn’t dare touch an auction because the buyer generally will be scared away from that or the buyer’s not in a position to make an unconditional offer.

However, in other markets, in far more mature markets and far more seasoned markets around Perth Metro there’s heaps of suburbs where it is suited to. And vendors where it’s suited to. So I think you know, it really is one of those, unlike other states where, auction would be the absolute go-to and anything else would be secondary.

In Western Australia, I think there are discrete pockets where it definitely works and others where I think you just gotta take a more rounded view on other methods.

Peter Fletcher: Mm-hmm. Mm-hmm. Okay. So that’s Victoria. Is there a chance that [00:20:00] these kind of government interventions will land on our shores?

Rob Mandanici: Look, I’m always reluctant to second guess what a government might do. Look, it’s the West Australian government has been quite, I think quite commercial in its approach to the real estate sector broadly. And I don’t think

the volume of auction and the number of concerns raised, and I don’t think there are any concerns raised. So I think, you know, there isn’t the volume of complaints that there are in other jurisdictions and I think that’s got a lot to do with the way that our agents conduct themselves. We do have a robust auction code of conduct that’s set by the Real Estate Institute of Western Australia. A reasonably robust auction sales act that’s been around for a long time, but seems to work. And I think. You know, a small pool of auctioneers, but a very skilled pool of auctioneers in Western Australia.

So whereby in other states it’s open slather. In West Australia it’s still a licensed profession. It’s a [00:21:00] small pool of professionals, but they do it well. And I think that itself goes a long way to some pretty hardcore self-regulation. So in the auction scene. I don’t think so, and I don’t think we’re gonna see that contagion scenario where one state sneezes and, you know, sort of fall into line with a set of rules that perhaps aren’t necessarily going to work in the interests of West Australian sellers and buyers.

Peter Fletcher: So, you mentioned about you know, government you didn’t wanna ban, bank yourself or back yourself in on you know, knowing what the government was gonna do. So we’ve seen recently the Cook government announced, Perth Park slash the racetrack slash whatever you want to call it. And almost at the same time announced some big changes to shall we say, zoning laws.

So they’ve put circles around train stations and said. Basically build what you want in those little [00:22:00] circles. And I’m, I know that I’ve not explained that accurately at all. And that’s Okay. My point being, is there a chance that the government, because they have this massive mandate and almost no opposition, Robert, is there a chance that they might say, you know what, we’re gonna flex on the industry and we’re gonna, we’re gonna make some big changes to the. Real estate and business agents code of conduct, for example.

Look, I think that’s always a possibility and we see that with governments generally especially governments with large majorities.

And I think we’re seeing a symptom of that federally with social media changes, a social media ban mm-hmm. Into effect in a couple of days on under sixteens.

Mm-hmm.

Rob Mandanici: And, but they can also be a double-edged sword. And I think any government that goes into something so headstrong with a view that, well, we have a majority, we will do what we want.

Always suffers from that hubris. And you know, I’ll take a Victorian example. Many would say that the Kennet government suffered that. Mm-hmm. [00:23:00]

Peter Fletcher: Losing

Rob Mandanici: an unusable election through hubris doing everything to legislate for the metro and forgetting about the country. Some would argue that that happened to the Keating government, that there was arrogance.

Some would argue that that happened to the Howard government and some would argue to some degree that that happened here in West Australia to the Barnett government. Mm-hmm. And I think any government. State or federal that that forgets to be humble. I, I think is destined to fail no matter the size of their majority and no matter what disarray their oppositions at the time mm-hmm.

In. Mm-hmm. And I think you know, but I come back to it and particularly state government you know, I think they’re quite understanding. To a large degree the housing problems in Western Australia and quite acutely aware that, that the small effect or the large effect, sorry, rather that small changes can have.

So you know, if you have to touch it at all, touch it very lightly. Whether that’s planning law whether that’s tenants, which they haven’t

Peter Fletcher: touched lightly.

Rob Mandanici: No. Well, this is gonna be a very interesting one [00:24:00] and you know, I dunno how far the rabbit hole on this one we wanna go. And full disclosure I think it’s important we both live within meters of one of these zones.

And I think we both know that our own council that we live in actually approved very, very similar planning changes some time ago. So. I suspect that this is more aimed at perhaps a different string of suburbs than the ones you and I

Peter Fletcher: live in. Mm. Western suburbs, close to railway lines, and my God, there’ll be some kickback against that.

Rob Mandanici: So, I think it’s certainly directed at a suite of other suburbs. But I think you know, I think ultimately, and again, we talk there these planning changes around, around rail lines and around their metro net network will go some way. Small way towards relieving some of the housing problems that we’re encountering in Western Australia and more broadly.

And I think that is important. And I think that becomes a mindset shift towards a higher density living, which is a challenge for a lot of people. I understand that, but there is a large cohort of people currently living in Australia or who wanna come to [00:25:00] Australia who are quite comfortable with higher density living.

And I think we’ve just gotta really grapple with that, that there is a shift towards that. And we’ve seen that shift in Sydney and Melbourne and other places, and Brisbane in particular. And I don’t think we’re immune from that.

Peter Fletcher: Back in the sixties, in, in the, yeah. In the sixties they built some very, some high rise buildings.

You see them along Hampton Street in Burwood, king George Leonard Street, you know, really big blocks of units. And that by the mid eighties or mid to late eighties, early nineties, they’d kind of become ghettos. They were not, they’re not somewhere that you would say, oh, I really wanna live in at 69 to 71 King George Street, for example.

Mm. The government setting themselves up for a similar failure in 30 years time.

Rob Mandanici: Look, I know some of those, well, I used to live opposite one of [00:26:00] those. Mm-hmm. Look, I think the facilities available in those then and now are very different to the facilities. I think that will be available in some of these newer developments.

And I think that’s probably key. And we talk about high rise. I mean, you know, a lot of call it what you want, NIMBYs, let’s call it that. Mm-hmm. I think a lot of NIMBYs will, will point at a lot of those brown brick constructions and, what is it, Brownley Towers, I think was one another. Yeah. We’ll point at those and go, you know.

That’s, I think that’s, that’s really in the past. We talk about highrise and we talk about some of the stunning buildings just in Perth alone. Look at some of the developments in in Rivervale some of the new developments in Burswood on the peninsula. And you know, in particular, look at Elizabeth Key.

Now I know a lot of that is higher end living, but then, you know. Complimenting that all the way down St. George’s Terrace. Adelaide Terrace and Hay Street are a number of high rise developments that are affordable, that are mid middle of the road developments, both as rental accommodation and, and, you know, off the plan accommodation at the time.

You know, with goods, facilities car parking. ’cause that’s [00:27:00] a, that’s a key issue I think for a lot of people in apartment living. Large balconies and decks. So they are available out there.

Peter Fletcher: Mm.

Rob Mandanici: And I think a lot of the current design guidelines you know, that require a lot of these larger spaces, green spaces and all of that, I think really does change the dynamic away from, some of those towers of the sixties and seventies.

Peter Fletcher: Mm mm Yeah. My concern is that they will be, you’ll squeeze a lot of people into one space. But the ones that are nice to live in, you won’t be able to afford to be in there. Can we build enough affordable accommodation at scale? That is

Rob Mandanici: I think if we can solve that. Question and that problem. I think that’s obviously the answer to, to, to our problems. I mean, we’ve got a massive demand side equation and a very deficient supply side of the equation. And it’s been like that for a long time.

It’s not a new problem. It’s been something that groups like the [00:28:00] Real Estate Institute, property Council and others have been talking about for years. Mm-hmm. And a lot of governments just not listening.

Peter Fletcher: So you are the deputy president at the.

Strategic agenda right now.

Rob Mandanici: So, and this is gonna sound like a cop out, but we get to reset that agenda early. And this is sound like

Peter Fletcher: somebody I’ve just called for a price guide. Well, we’re taking expressions of interest. What would you like on the agenda, Peter?

Rob Mandanici: And, and really a bit of that is almost taking expressions of interest from our members.

Oh, a lot of sounding from our members in terms of what they want going forward. But I think, you know. The agenda for Rewa, I think, really is to be vigilant of the changes that are happening in our industry. And there’s a lot of change happening in our industry.

Peter Fletcher: Mm-hmm.

Rob Mandanici: And I think just being both you know, vigilant towards that, but also ensuring that we’re contemporary to those changes to agents’ needs and wants and what they want from their institute.

And what they want their institute to be. We’ve spent a lot of [00:29:00] time, or the team, the executive team, has spent a lot of time ensuring that our training is relevant, that we’ve got the right training systems going forward, that we are delivering courses that are relevant not just to agents, but the industry broadly and how that translates onto the consumer experience and how consumers are treated.

Both coming back to, you know, for example, some of our other conversations around, honesty and fair, dealing with buyers and sellers and. Everyone in that transaction.
Peter Fletcher: Mm-hmm.

Rob Mandanici: So a lot of focus on that and a lot of focus within Rewa, just about ensuring that we are serving our members’ interests that we, you know, become, I guess, a real beacon of good member experience.

We’ve just,

Peter Fletcher: what are the big things in your mind? The big ticket items coming up for the next six to 12 months, Rob.

Rob Mandanici: Industry wide or,

Peter Fletcher: mm-hmm.

Rob Mandanici: Look, I think you know, we would we will probably see further reforms in, in the real estate sector in particular within tenancy legislation.

And again, I [00:30:00] think some of that is really just coming into line with. A number of changes that have been made in other jurisdictions over many, many years. And, and some of those more around minimum standards and, and compliance items. Not necessarily a scary thing. I think some of those, a lot of people, a lot of owners will look at them and go, that is a, that is a no-brainer.

I think that on a lot of people’s minds will be sustainability. Mm-hmm. It’s going to be a big key going forward. Mm-hmm.

Peter Fletcher: How that trans, why do you think that, Rob, where’s the demand for that coming from? What’s the signal aside from the the people that have got a vested interest in pedaling the message?

Where’s the demand coming from?

Rob Mandanici: So I think, the, the crux of it comes down to some of the big drivers within the industry more broadly, and they’ll be insurers and, and banks and I think Right. And a lot of the, the data providers. Mm-hmm. There’s you know, there’s a fair bit of info out there that I think a lot of banks wanna move towards a [00:31:00] system where if a home is more energy efficient, ultimately cheaper mortgage, hopefully translating into cheaper energy prices and a better, better living standard in a home.

Peter Fletcher: Mm-hmm.

Rob Mandanici: I think, you know, when

Peter Fletcher: I, they’re big leavers you’ve just used, you’ve just used banks and fi banks and insurance. So if we’ve just seen the fires over in the new South Wales and if insurance companies say, well, you are in a bushfire prone area we are not going to insure you.

If you can’t get insurance, you can’t get finance. Right. So, and we find that now, so for example, if we go back to some of those far outer suburbs, there’s a number of those that sit within bushfire zones that some insurers won’t touch. Mm-hmm. And some pretty hefty insurers that won’t touch them.

Rob Mandanici: And there’s some that will and. I think again, that’s coming back to just being mindful that some of those issues already or concerns already exist. I liken the banking towards vehicles. So, you know, some banks will preference better interest [00:32:00] rates towards energy efficient vehicles or less emitting vehicles.

So similar situation there. And I guess really we could tie that into to planning laws and building laws. Touching on those coast fires in New South Wales just recently a number of homes damaged and destroyed, and I noticed one completely unscathed, a recent build following all the recommended bushfire ratings and standards as set by the local government authority.

Peter Fletcher: Really and

Rob Mandanici: the only home left standing in a certain patch. So, wow. Whether that’s good luck or good management. Mm. Or a combination of both. I think that’s gonna be probably a beacon of an example that just maybe some of these methods are they’ve got it right.

Peter Fletcher: Okay. So the sustainability piece isn’t going to come from people walking into a home open saying. We want solar panels and we want. R six insulation. It’s gonna come from the bank saying if you buy a home with solar panels and R six [00:33:00] insulation we will give you a cheaper interest rate by quarter of a percentage point or something like that.

Rob Mandanici: I think that’ll be one of the main drivers. I mean, there’s no doubt there are buyers or tenants out there who do look for those things. But. You know, they’re not a large proportion of the buying or renting population at this point in time. Mm-hmm. But I think those drivers will come from higher above.

They will come from banks, they will come from mm-hmm. Insurers and or the leavers of government. And, you know, we see that now. I mean, government’s incentivizing. And I’m talking broadly, not just in Western Australia, but around the country, different governments incentivizing for different things, whether it is solar insulation changing from, say gas to heat pump, or electric to heat pump or gas to electric.

You know, battery storage, all kinds of different appliance combinations that are out there in different states. So we are seeing that slowly.

Peter Fletcher: Mm-hmm. Mm-hmm. Okay. So what are the other big ones?

Rob Mandanici: Look, I think they’re probably some of the key things on the horizon. I think coming back to REIWA itself we have a new CEO who’s just started to be [00:34:00] himself in, and I think that’s gonna be you know, a very exciting time for us as an industry.

You know, moving forward. He comes from,

Peter Fletcher: He bought me a couple of beers the other night. Excellent. What a top, what a top guy?

Rob Mandanici: A good look, a good guy. And I think, you know, just genuinely a good person with a really good customer service approach. And I think from our member experience perspective I think he’s really going to go the extra mile there in that regard. And I think some very sort of broad lateral thinking around industry. He’s not from our industry, but he is from a service-based industry. So I think there’s certainly gonna echo some similarities there in what he’s used to.

Mm-hmm. But also I think bringing a new perspective as well, being somebody from outside of the property industry. Mm-hmm.

Peter Fletcher: And is A-M-L-C-T-F a concern for agents yet, or are they still

Rob Mandanici: Look for some agents it is. And I think, like everything, there’s always gonna be pockets which pop up and look.

We had some recently that surfaced and said, oh, we dunno anything about a ML, what’s you know, what’s the institute doing about AML? And, [00:35:00] we’ve I think we’ve smashed out, maybe 40 or so emails in the last couple of months. Webinars, in person briefings and whatnot.

So there’s always gonna be a small subset that have ignored their emails or messages and whatnot. But look, a lot of agents understanding firstly why we have to do it and they’re understanding the reason or the rationale behind it. And a number of them, I think taking comfort that there’s a few operators out there now that can provide a streamlined solution for them.

I think the challenge is going to be when it is fully implemented. Between the buyer and the seller, I think that’s where the challenge is gonna be. ’cause there will be pushback and people have been taught for a very long time not to hand over information unnecessarily. And now all of a sudden, their real estate agent, or their accountant, or their lawyer, or a number of other people in that value chain are going to ask them for some information that they may not be comfortable sharing.

Peter Fletcher: Mm.

Rob Mandanici: And some questions they may not be comfortable answering. So, I think that’s gonna take a lot of education a lot of education with the institute and their members and a lot of in [00:36:00] education with our members and their customers. Mm. And explaining why this is necessary and why it’s important.

Peter Fletcher: Hmm. Where are the big opportunities in real estate over the next three to six months?

Rob Mandanici: So, as an industry or from a buyer’s perspective, a seller’s perspective,

Peter Fletcher: let’s go from an industry’s perspective.

Rob Mandanici: So I think I think the biggest one. And always has been is, is data. And, and I think that’s, that’s gonna be a big focus.

And if we come back to a ML, it’s gonna be the security of data.

Peter Fletcher: Mm-hmm. And

Rob Mandanici: the security of that information that the agency is capturing for the government and what we do with that and as a very strict purpose and communicating that to our clientele. And data on the flip side of, the amount of data that is out there and what can be done with that as an industry going forward and into the future and how we make our agencies better.

Peter Fletcher: Is there anything on the agents of the future, is there anything on the horizon where you, you’ve seen or you are [00:37:00] seeing products in the development stage or in the early stages of adoption? Were you saying, well, wow, this could be a game changer?

Rob Mandanici: Yeah, I think there’s a lot going on. In that AI space.

And I don’t think, you know, I don’t think AI is a flash in the pan. I think you know, there is a lot going on in that space. I think a lot of people are coming to terms, again, with the the cost of ai. You know, the, the amount of electricity it requires, it is

Peter Fletcher: not free. No. The

Rob Mandanici: amount of of water and other resources it requires.

But which sounds interesting when we’re talking about computers, but they’ve gotta be powered and they’ve gotta be cooled.

Peter Fletcher: Mm.

Rob Mandanici: So I think there’s a lot going on in that space in the property industry, and I think there’s a lot of scope there. We are seeing, and we’re starting to see some of the data providers provide their clients with little snippets of AI modules and, you know, AI opportunities within their software.

Talking particularly about the management software that we use within my office you know, there’s a number of sort of AI modules built into it. Just starting to come to before. I think we’ve really [00:38:00] only scratched the surface with that sort of thing. And again, the, the data opportunities that come from that.

Peter Fletcher: Mm-hmm. Yeah. So we saw recently Nikki, Dino trialing a, an ai receptionist, well, AI support staff. It was, it was pretty impressive. And what we’re looking at there is. A very juvenile version of, of what, you know, you can imagine where it would go, where it would be in let’s say 12, 18 months time.

Rob Mandanici: Absolutely. And I got the chance to, to trial it. She, she sent me the number and she said, can you ring this and put it through its pacers. And you do, you sit back and you go, gee, that’s pretty good. Where we’re at today, where’s that gonna be In two or three years time? Yeah. Or 10 years time. And we’re seeing the same with reporting inspection, reporting.

There’s a number of AI modules available in, in, in reporting. So you know, whether that’s you know, supporting tendencies and even the building sector. You know, so there’s a lot going on inside, I [00:39:00] guess that property ecosystem. And a lot of scope there when it comes to, you know, what change that’s gonna bring to us.

Peter Fletcher: Hmm. Rob, you are first and foremost. Husband and father. And then you’re a real estate agent and then you are the deputy president of Rewa. From a real estate agent’s perspective, if someone wanted to do business with you, how would they get a hold of you?

Rob Mandanici: Look, Google me. That’s probably the easiest

Peter Fletcher: one.

Yeah. You’ve Google

Rob Mandanici: Paddington Realty. Yeah. My name. It’s a pretty distinct name, so, yes,

Peter Fletcher: Robert Manchi as

Rob Mandanici: find even if you spell it wrong. Yeah. It’s not hard to find even with the wrong,

Peter Fletcher: and if someone from the real estate industry wanted to reach out to you as a, as a counselor to chew your ear, same way, are you open to that?

Absolutely. Yeah, all the

Rob Mandanici: time.

Peter Fletcher: Okay, Rob, been great as usual. Thank you for your time and until next time, this has been Peter Flexer on the WA Property Q and A podcast, and that wraps up another [00:40:00] episode of the WA property q and a. We hope you found our discussion valuable and gained some valuable insights into the world of property buying in Western Australia.

Remember, while we strive to provide useful information, it’s crucial to consult with the appropriate professionals before making any investment decisions. Don’t forget to tune in next week for another exciting episode where we continue to unravel the mysteries of the WA property market. If you have any questions or topic suggestions, feel free to reach out to us.

Until then, happy Property Hunting and remember to seek the right advice for your personal circumstances.

Thank you for listening.