The new career path

Transcript

Peter Fletcher

[00:00:00] Peter Fletcher: Welcome to the WA Property Q& 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 markup 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& A Podcast. And with me today is one David Palermo from the agency. So good to have you here, Dave. Thanks for inviting me, Peter. So I’ve known Dave for about, I don’t know, it’d be about 12 years or something?

[00:01:04] Davide Palermo: Yeah, I think when I started in industry, so probably a good 10 to 12 years ago.

Yeah.

[00:01:09] Peter Fletcher: Yeah.

[00:01:09] Davide Palermo: The old days.

[00:01:10] Peter Fletcher: The old days. And you were with the professionals back then.

[00:01:14] Davide Palermo: Yeah, started in a franchise in a little, little town called Victoria Park, part of the professionals team there.

[00:01:21] Peter Fletcher: How’d that go?

[00:01:22] Davide Palermo: It was an interesting learning curve the professionals are a well known brand in WA and they had a great little team there, so it was really a good spot to start my career and learn from the people that were there at the time.

[00:01:34] Peter Fletcher: Hmm.

[00:01:35] Davide Palermo: Dean O, Dean Niccolo, isn’t it? That’s the one. Yeah. The one and only. And Michael Noddy. Yeah. Michael was there at the time. Yeah. Since since moved on to, to do his own thing. Yes. Yes, and

[00:01:47] Peter Fletcher: how is Giovanni Notte related to Michael?

[00:01:50] Davide Palermo: That is his son.

[00:01:51] Peter Fletcher: Yeah. Now I spoke to Giovanni the other day and You have to get him in on the show.

I might have to, because I asked him I asked him if the episode of Lux Listings Perth came to town, who would be Gavin Rubinstein? And I think he had designs over the Gavin Rubinstein person.

[00:02:11] Davide Palermo: Are you going just off the look and the clothing? Or is it something to do with swagger as well?

I don’t know. Maybe

[00:02:17] Peter Fletcher: all of above. A bit of attitude too. He’s got kind of, he was claiming it. He wanted it

[00:02:22] Davide Palermo: by the sound of it. We’ve got one of the young guys in our office. I think he met him yesterday actually and he’s got that. I think Gavin might have been his his role model to get into real estate.

When they start putting on the designer shoes with those socks at home opens, I think that’s the look that they’re going for. Yes. That was

[00:02:37] Peter Fletcher: Spiro, wasn’t it? That was Spiro, yeah. Yeah. He’s definitely got the apprentice Gavin Rubenstein look. Yes. Yes. There’s no doubt about that.

[00:02:44] Davide Palermo: Oh, good old reality TV though. Especially real estate reality TV, just, oh, for this industry, I don’t know if it’s a good thing. I think it’s it sets it up for, A lifestyle that’s not real, we know reality TV is not real, but in the real estate world, it’s not something you should be following as an inspiration to get into real estate, that’s for sure.

[00:03:03] Peter Fletcher: Because the whole idea of those those shows is that money’s where it’s at. The Lamborghini, the 10, 000, 20, 000, 30, 000 suits, the expensive watch collection. Yeah, it’s all

[00:03:19] Davide Palermo: the flashy side of real estate, isn’t it? All the flashy side of entrepreneurship is on display in full effect. And I guess, where’s that filmed?

Is it Sydney, mostly, that they film it? With the median house price, triple of ours at some stage. Or even those areas they’re selling in are the extremes. of the industry, 10, 20 million dollar properties is not the norm in good old Little Perth, it’s very different.

[00:03:41] Peter Fletcher: I reckon

[00:03:41] Davide Palermo: they should start a show called Lux Listings Langford.

I don’t know if the word Lux and Langford, just because grammatically it rhymes, I don’t know if we could pull that off, I

[00:03:52] Peter Fletcher: reckon that could be a really good show.

[00:03:54] Davide Palermo: Yeah, well we can’t swear on this show, so we’ve got to try and find words that sort of align themselves, but you know, there’s people that go on with the aspect of embracing.

How shit their suburb might be sometimes, armadale’s had a bad rap for so long, but if you ask people that live there, they, they, they’re there for a reason. They love the features of Armadale. So maybe you could embrace it and maybe not the luxe listing as far, but we could go on with something else of the real suburb.

[00:04:17] Peter Fletcher: So, well, the real estate agent version of the real housewives of Armadale. Yeah. Except the real real estate agents of Armadale. We’re going off on a tangent here. I’m not sure we can continue with that. A good, good point, David. Good point. Now Dave, you went from, the pros to I think my old office, my, well, kind of my old outfit.

[00:04:39] Davide Palermo: What did PFR stand for back in the old days? Oh, who

[00:04:41] Peter Fletcher: knows, Dave, who knows, yeah. Yeah,

[00:04:43] Davide Palermo: yeah, Peter Fletcher Real Estate, yeah. Something like that. People for Real Estate. Yeah, PFR, so, wasn’t a big switch for me in terms of, geographically, though, still on Albany Highway. A move in, what was, what was in the old real estate world.

I guess the patch area was kind of the same, I don’t think patches are as important. Yeah, so I made the move to, to PFR and the role changed a little bit, it was sales as well as property management that we’re trying to bring on at the time. And that was a good sort of learning curve.

That was you step out of that role of being just a salesperson, but having to be, you’re a business owner and all that sort of stuff that entails as well.

[00:05:14] Peter Fletcher: And so, so were you a business owner? One of the, one of the principals there? Yeah. Right. Okay. So and and then you were, swept away from PFR? You went straight to the agency from there, or did you? Yeah,

[00:05:28] Davide Palermo: straight to the agency, yeah. So, I guess in my career, I haven’t really I know a lot of agents have been in a lot of real estate agencies and I guess for me I’ve been long term at most of mine and haven’t jumped around too much but being at the agency when they were in their infancy stage, the agency that I joined is very different to the agency that you see now but I could see with them a change in the model.

Change in the way they wanted to do business and, this whole concept of a, a cafe strip agency having to have an office to get listings and get leads where as the agency we’re moving to, no, no, no, it’s the person, it’s the brand. You are, as an agent, the brand that brings people.

And I could kind of see that sort of developing and I think we’re still probably one of the strongest brands out there now from what was some, some infancy days back in the DoubleView office many, many years ago.

[00:06:20] Peter Fletcher: And so from what I can see from the agency, you guys are all about, it’s the agency is powering the individual brand.

Is that, is that a fair assessment?

[00:06:33] Davide Palermo: Yeah, I guess the way that

[00:06:35] Peter Fletcher: It’s not quite a The agency’s not quite a watermark to the individual brand, but it’s certainly not the model of some of the, more traditional agencies where it’s kind of like the agency and then the individuals are a sort of supplement to that.

[00:06:52] Davide Palermo: Yeah. I guess the way to look at it, if you are an agent watching the show is that the agency itself helps us do our job. They power what we do. So in essence, the agency I’m, they need to look after me. I am the agency’s client, and if they can look after me, that gives me the opportunity to do my job better with my clients.

Mm-Hmm. . So in the end, my clients are the buyers and sellers of the properties we’re selling. So they are there to power us and support us and give us everything we need to be able to do that. And every agent’s different, so every agent’s going to need something slightly different from. their support team and their agency.

And they allow us to do that. So they recognize that, at the beginning, our whole model was to try and attract the best agents in Perth as well as nationally now, and just empowering us to do what we’re really, really good at. And for, for most agents, that might be the people part of it.

That might be the getting along with buyers and sellers, for others, it’s, helping them market and prospect better. And that’s what their role is. And that’s where the shift was that I could see that was really changing in the industry was agencies helping the reps to do their job, which is very different from I guess the culture that you grew up with where it was the, Agency, general manager, employing people and telling them how to do it.

I think that’s the shift.

[00:08:07] Peter Fletcher: Yeah. Yeah. It’s very much it’s very much turned things on its head. There’s no question about that. Now I was you’re running now a thing called the Age, the Academy, I think, is that what you’re calling it?

[00:08:19] Davide Palermo: Yeah. We’ve been running the Academy for a few years now.

Yeah. You

[00:08:22] Peter Fletcher: had, I think there was about six, six or seven people around that table where we’re talking lots of, lots of real estate. I just want, and I

want to come back to that and maybe it’s another whole episode in terms of, career and career development. How are you finding the market right now?

[00:08:41] Davide Palermo: I guess everyone assumes the market is incredibly hot and if you talk to people let’s use the politicians pub test, like they always pass these things through the pub. What would the average Australian think about the real estate market? And everyone thinks it’s a great time to be a real estate agent because properties are selling super quick.

And yeah, that’s true. Perth properties selling very quickly, you’re getting multiple offers, but that’s not the scenario and not the case for every agent. So we’re finding the market quite good. When we’ve got listings the experienced agents are able to keep getting listings, but there’s a lot of people in the industry that are not surviving.

They’re finding it very difficult to get stock. So it depends on that question of how’s the market. Am I answering that as an agent or am I answering that as someone that’s selling and cashing out of the market?

[00:09:25] Peter Fletcher: Okay, let’s answer it from the consumer’s perspective. So from a seller’s perspective, I’m thinking you’re going to say the market is amazing.

[00:09:32] Davide Palermo: Market is probably one of the best ones we’ve seen in a long, long time, especially my career. And I would assume maybe your career, it’s the best that we’ve seen. I go back

[00:09:40] Peter Fletcher: a long way, David. You go back a long way. Yeah, so I go back to 19 1886, I think, yeah, no. Yeah, so

[00:09:46] Davide Palermo: horse and cart at every home open.

Yeah, yeah. That sort of scenario. Which It has to be one of the best markets we’ve seen in a long time for sellers. But that then also creates the problem at the other end, which is. How is the market for the buyers? And what we’re noticing from the buyers is that they’ve missed out on properties.

We as agents probably prefer to meet buyers that have missed out on a couple of properties. We can help them and guide them through the process. They know what they need to do when making offers and things like that. So sometimes having buyers experience that is, helps them get deals later on.

But yeah, we’re definitely finding the buyers. It’s a tough market for them to be in this market. Definitely. If we call on some recent stories, I’ll drag my family into this. I have a niece and she’s, engaged, getting married, they’re looking for properties and, being the uncle in real estate, I’m getting the text message, what do you think about this one?

Where should I put an offer in? What’s it worth? And so even us, as agents, are trying to provide that guidance to family and friends and they’re getting blown out of the water with offers, and we’re talking about two professionals in their mid twenties. Thanks. They are earning good money, but they’re missing out on properties, because there’s other buyers that have just got bigger, deeper pockets, bigger budgets.

So, very tough to be a buyer right now.

[00:10:57] Peter Fletcher: What would you say to, what’s your advice to, is it your niece? What’s your advice to your niece and her partner? Like in terms of, They wanna buy a property, they want to, they wanna win one of these negotiations. What? What advice are you giving her?

[00:11:15] Davide Palermo: Oh, do you dig back down to the Italian roots and go, no, don’t move, just stay where you are.

Pay everything off and buying cash. Like, is that pay

[00:11:22] Peter Fletcher: outta cash? Pay cash,

[00:11:22] Davide Palermo: yeah. Is that what you have to go back to? But I think realistically is yes, you are going to have to pay more than the advertised price of a property has got one. Because there is way

[00:11:32] Peter Fletcher: more is

[00:11:32] Davide Palermo: Yeah, way more. You know how much is way more.

But that’s just been. What their experience has been, they’ve had to pay more than they were first thinking. And I guess what they’re now doing is they’ve had their set area that they wanted to be in, and what we’re noticing across Perth is that people are now pushing out those boundaries of where they wanted to buy.

So if they originally wanted to buy in, let’s say Vic Park, which is where we’re filming today, they’ve They might not have wanted to go to St. James, Bentley, etc. before or Carlisle, but they’re having to push out into further suburbs to be able to find properties that are in their price range and things like that.

So my advice to anyone in that situation is look a little bit further away from your ideal suburb. It might be a kilometre or two outside that ring that you’re looking in, but also, don’t get sucked into just paying overs for the sake of competing and doing that. Know your budgets and just start looking for properties.

Better value for money in other suburbs if you can.

[00:12:28] Peter Fletcher: What is OVAS?

[00:12:30] Davide Palermo: Well, we’re seeing 10 percent over on some properties depending on the price ranges. My point there,

[00:12:36] Peter Fletcher: behind that question, is what does overs look like? Is it, like you go, well I’ll pay 10 percent over the guided price. Well that puts me, let’s say for the 82 Westminster, the one you’ve got, that puts me at around about 1.

1. Who’s to say it’s not going to go to 1. 2?

[00:12:55] Davide Palermo: Yeah. The competition determines that, doesn’t it? But knowing that going in. So if it is a sale that is an open, transparent process, whether it’s an auction or online auction, I guess just knowing what your budgets are and sticking to those and continually looking if you can.

[00:13:08] Peter Fletcher: But Dave, budgets are a weird thing. Because you, like you’ve got people that will, I’m working with a buyer at the moment and, the budget was. It started out, I don’t want to go any more than six. And then we, we found something that was, we thought we were a chance at 6. 50, had a crack at it at 6.

72, 7. 50, and missed out on it by 14, 000. And suddenly the budget’s gone up over 10%. And it’s, it’s, it’s just, well, had we been able to play with that budget, that bigger budget from the start, it You know, and the danger is that they chase the market up and chasing the market up is more dangerous than paying too much for one.

Like if they had paid a bit too much for one three months ago, they’d be now secured and in their home and the market would risen to a point where, well, it’s now probably worth what they paid. If they keep trying to sneak up and trying to stay within what’s comfortable, it’s a really bad recipe for

[00:14:17] Davide Palermo: At some stage, you have to If that’s your intention, you have to get into the market at some stage.

So at what point do you go, okay, I don’t want to pay that, but I do need to pay that. And that’s what we’re seeing. We’re seeing people, I talked about before where people have missed out on properties and they’re going, I’m over this. I need to get into the market. That property is not my ideal property, but it ticks a lot of boxes.

And I guess this could be a generational thing. Who’s buying right now? Is it the young people? Is it the old people? And out of those people that are buying, have they ever compromised in their life? Are they used to this culture of they get what they want? We can go back and tell stories of my parents, and lots of families not having carpets in a property and moving in when it’s just concrete and compromising on things.

[00:15:00] Peter Fletcher: It’s the perfect Italian home. Concreta.

[00:15:02] Davide Palermo: Concrete everywhere. But you hear these stories of they went without. Whereas I think now the expectation is, no, no, we need everything and we need air conditioning. We need this stuff and they want all of these things in the property, which is why, well, where’s the compromise?

How far does that budget stretch? And yeah, you are chasing the market, but at some point you need to compromise on something. It might be the location. It might be the type of home. I know in my own buying experience, and as I’ve done a lot of developing and stuff like that, but when buying my own home in East Vic Park, for example, we looked at a place and it just didn’t quite think it was for us.

It came off the market.

[00:15:36] Peter Fletcher: Yeah.

[00:15:36] Davide Palermo: That’s a strange thing to be talking about. A property didn’t sell. But so this was in a different sort of Back in the day. Back in the day. It wasn’t that long ago. It was probably 12 years ago. But the idea

was that property came back on the market and I looked to my wife and we thought about it.

We went back and we thought, yeah, that’s it.

[00:15:50] Peter Fletcher: This wasn’t so bad.

[00:15:51] Davide Palermo: This wasn’t so bad, but we compromised because it wasn’t exactly what we want. And we knew during our lifetime there, we’re going to have to do things to change it, to, to fit it in. But it, it wasn’t that, Ooh, I’m going to go get the perfect home for myself and overextend and go above your budgets and things like that.

So it’s, it’s a tough one because people. Chase the market, and we know now, agents talk about multiple offers, lots of offers on properties, and there’s probably people there that are just going, oh, my budget’s this, and they throw an offer in, and then they just form the basis for going, okay, our current offer is 900, we need to move from there.

[00:16:24] Peter Fletcher: Yeah, yeah, I call it using someone’s offer to sharpen another person’s pencil. Yeah, happens all the time. I was talking to a local agent, Derek Baston, this morning about one he’s got in Macmillan Street and, I looked at it and I went, well, I thought, high sixes, mid to high sixes, and I texted him words to that effect and he, he, Texted back, LOL, buyers over 700, and I don’t know.

[00:16:53] Davide Palermo: Turn that six upside down, it’s a 900 now. Oh my god, yeah, and

[00:16:57] Peter Fletcher: it’s like, it’s so hard to read at the moment.

[00:17:00] Davide Palermo: And agents as well, we look at the data, we’re looking at what’s happening amongst our stock. And, I like to think we’ve got a good relationship in the Little Vic Park real estate community.

We do try and chat all the time about what’s going on. Recently, a Sort of Isaac who works with with Derek and that team. We’ve managed to piece a deal together. Some of my sellers going into, a property that he had available and things like that. But we’re looking at things going forward.

What do you think it’s worth? Where do we see value? And we can only provide guidance so far, because the market then takes it in its own direction. And you’re just never quite sure. So, if you’ve got agents and, as a buyer, if you’ve got agents and you’re asking them questions and a little bit vague on pricing, well, hopefully they’re being honest with you that, hey, we’re vague because we think it’s here.

But what’s the market telling us? Because we’re seeing so much demand come in.

[00:17:46] Peter Fletcher: When you’re appraising a property and the seller’s going, well, where do you think it’s at? So you’re obviously going to start with the sales evidence. And so the sales evidence is going to tell you a story. It’s going to give you a rough number.

Let’s say, your sales evidence for Well, let’s talk about the one you’ve got around in Westminster.

[00:18:05] Davide Palermo: We can talk about any property, really. Yeah.

[00:18:07] Peter Fletcher: So the sales evidence on that one’s probably said to you it’s worth nine, nine fifties in that, around about there is what I’m guessing, don’t know.

And when you get to that point, what do you add to that as a saying, well, I’m The sales evidence is suggesting here, but it could get to this number here. What sort of rough percentage? Oh, the difficulties

[00:18:31] Davide Palermo: of the Vic Park market. Yeah. Because you look at these inner city markets, not just Vic Park, but you look at these as an agent.

I sometimes think El Camos is looking really good right now. They’re all four by twos on 300 square meters. They become very easy to value. We’re not valuers, but they come very easy to. Yep. Yep. But in East Vic Park and Vic Park and Mount Lawley, you’ve got so many different. Yes, it’s always been a tough one as an agent to get your head around it.

So, so yeah, we do look at past sales, but we, you really have to take that with a grain of salt because the past sales now are perhaps 30 to 60 days old.

[00:19:06] Peter Fletcher: The

[00:19:06] Davide Palermo: data is old now. And in a fast moving market, we say, well, okay, 30 days ago to 60 days ago, this sold for this. That’s similar. And then there’s

[00:19:16] Peter Fletcher: already a difference of 30 grand.

And they’re not

[00:19:19] Davide Palermo: the same properties. Every property is different. Even if the square meterage is exactly the same, every property is different layout, a hundred year old home versus a 70 year old home. They all have character. They all have these things that people love, but they’re so different.

And you really have to be, and I feel you have to be. Honest and open with your sellers. And sometimes that’s the dialogue. We’ll talk about dialogue later in maybe some training and mentoring sessions that we do, but the dialogue with the sellers has to be, we feel value is here at 900 for example. I don’t want to be the agent to come along and say, Do your numbers on 1.

3 million. If we get a great campaign, it could be 1. 3. These people who are selling are potentially buying somewhere else and relying on you as the agent to give them accurate advice. So I tend to be a little bit more conservative, but still give hope. So you have to say, we believe it’s 900 based on this.

We add a little bit of market to it. So, we’ve got a lot of current market sort of situation going on where it’s going nuts and people are falling in love with that type of home and what’s that worth? We talk about what’s overs, so what is that worth? Is that 10, 20 grand more? Is it 100 grand more?

We’re never quite sure on how much competition a particular home will have to get the pricing up. You really have to look at what’s happened in the past, what’s currently on the market, and also competition. We haven’t talked about competition for a while in our market, because things sell so quickly, but what is your direct competition in your marketplace right now, in your suburb, when you go to market?

And there might not be any. Or there might actually be some. You might have some bad timing and go, Oh, crap. The same style of home is on the market on the same street at the same time. And they’ve put a price on that one. Where do we see it? So, I think, in summary, I’ve answered that in a very long winded way.

You have to be honest with your sellers. Yeah. And give them conservative numbers to, to look at. And actually give them comparable properties and current listings. And that’s something I’ve noticed lately. So, in what I’ve heard, because obviously I don’t go into other situations with other agents while they’re talking to clients, but the feedback I’ve got from owners looking to sell is, you’re the only person that’s actually given us a figure.

And while my strategy might not be to give a figure to the buying public, how do you not give a seller, Some indication of what it’s worth. Hey Peter, thanks for letting me into your home today. I’m the professional, but I’m not going to give you a price on what your home’s worth.

It doesn’t really make sense to me.

So I think you have to stick to being the professional and give them a guidance on where you think it is, but then a strategy around how to get. Maximizing it. Or if it’s not maximizing it, it might be the terms and conditions that they’re more concerned about. Might not be too fussed on the number that they get.

But they might be fussed on our moving circumstances are pretty unique and we need to do this move in a particular way. So can you get me an offer that’s close enough to the money, but has the conditions we need, has the time frame we need? And in your experience, and I know in the Vic Park market, we have a very, I won’t say young professional anymore, they are professional couples who have jobs that they might have to move, they’re doing FIFO, and all these unique moving parts that we have to work around to give them a clean exit out of their house and moving into the next one.

[00:22:35] Peter Fletcher: Yes, it’s a tricky market, there’s no doubt about that. So where does it go from here?

[00:22:45] Davide Palermo: The crystal ball comes out every couple of weeks and I have a look at where we’re at.

[00:22:49] Peter Fletcher: Dangerous to play with this really, to be honest.

[00:22:52] Davide Palermo: I don’t see much movement in the market for the next six months.

[00:22:55] Peter Fletcher: As in much, much change to what’s going on? Yeah, I don’t

[00:22:58] Davide Palermo: see much change going on the next six months. I think we can get to this Christmas period where everyone starts reassessing their life over a four week period and, deciding whether they’re selling or buying. I don’t see much change. There’s, is there an election coming up?

Potentially, that’s sometimes a driver for interest rates going up and down and things like that. But I don’t really see much change in the market itself in the next six months. Now we’re on, we recorded this now, so this is going to come back in six months time. Yeah,

[00:23:24] Peter Fletcher: a hundred percent. And this is part of the benefit of doing this is, well, I went on record as saying that X and I was either right or I was right or wrong or I was wildly right or wildly wrong.

It’s part of the fun of it. And, but you know what? I think that it’s really dangerous to predict where it’s going to go because like who predicted COVID and the things that flowed out of COVID.

[00:23:53] Davide Palermo: And if you look at all the experts that came out of COVID at the time, and especially in the property market.

And the interest rate market and the economists, some were right, most were wrong. Very wrong about what was happening and the dynamics around it. So, we look at these things and, our team that we have, that we work closely with, and when I say that, that’s other agents in the agency, it’s also other agents outside the agency.

We try and just focus on the echo chamber and silo of just, Just the same four people you always talk to, you’re not going to get different opinions. So we look and look at this and talk about this all the time and it’s anecdotal, so it’s not stats, how’s your home open numbers and, that’s anecdotal or it’s quiet or it’s busy.

But we look at where we think the market’s going in three to six months so that we can advise our sellers because they’re going to ask us, should I sell now? Should I wait for the tenants to move out in three months time? What should I do? So we can give advice on what we see, which is hyper local to the areas that we know.

But, is the East Vic Park market very different to the Maylands market? Probably not. I think, what we’re seeing in these inner city areas is probably The same in other inner city areas, but on the other side of the river. So, we look at

that as being able to give our clients some advice, because we are the professionals in this industry to be able to do that.

[00:25:05] Peter Fletcher: And it’s all about the conversations, the narrative that’s in the market. I spoke to your guys yesterday about the conversations I’d been hearing about property management numbers, numbers through Home Opens and, those numbers, the People have been reporting slower numbers, zero visitors to Home Opens and so I asked that question on, on Facebook this morning and the answers I got were quite opposite to that.

It was like, I thought it was slowing down but it’s actually gone the other way. And and In any case, if it did slow down, perhaps that’s just seasonal. So, these are the signals that real estate agents who are very much on the ground, very much full time, very much like in the job, they’re list, they’re kind of, they’re the sort of signals, the feelers they’re getting all the time.

And they’re going, well, is it going this way or is it going that way? And, but at the moment it’s, Full tilt up.

[00:26:01] Davide Palermo: Yeah, and that’s why it’s important to be talking to lots of different people from different segments of the market. Yes. And different suburbs. Yeah. Yeah. Otherwise it becomes this propaganda silo of our office is saying that this is happening and everyone believes it.

Yeah. Because they don’t have any other sources of information. They believe that rhetoric that’s going on. So it’s important to listen to a wide spectrum in different suburbs in different price points to get a real understanding of what’s happening and where it’s going. And that rental situation, And even though it’s the rental market, is going to have a flow on effect probably a quarter later or six months later into the property market for sales and for pricing.

[00:26:38] Peter Fletcher: That’s if, if it actually does slow down, if it’s just seasonal, it won’t. It’ll just be play on.

[00:26:45] Davide Palermo: And what’s, I tend, I guess what happens in that situation is that landlords are adjusting for everything they’re seeing in the news. Oh, rentals in such hot demand. Let’s just put the rent up another 10%. So there might’ve been some examples of people going.

This shouldn’t be rented at 6. 50 and we’ve had no one at the home open. It should probably come back down to where it should be, 10%. So there could be some overshooting and people testing the

[00:27:09] Peter Fletcher: market. And that still happens. There’s still sellers and still landlords out there who Taking such a robust view of the market that they can, they outprice themselves.

[00:27:20] Davide Palermo: Oh, it’s a great time though. As a selling agent, if you’ve got those clients and they go, let’s try for 4 million, for example, you go, great.

[00:27:28] Peter Fletcher: Are

[00:27:28] Davide Palermo: you happy with the photos? Yeah. Very good. Professional drone looks good. Yep. We’ve got 10 Home Opens lined up and your feedback is, oh, Three people at the Home Open.

No one at the Home Open. So is it a problem with the photos? No. Is there a problem with the marketing description? No. And you it’s a process elimination. Well, I think you know what the problem is. It’s not potentially worth what you think it’s worth. Because we are in the best sellers market ever.

So yeah, people will overshoot their expectations. And the greed steps in.

[00:27:55] Peter Fletcher: Dave, what’s your favourite method, marketing method at the moment for property?

[00:28:01] Davide Palermo: My favourite method probably hasn’t really changed in its result. And the result that we want is multiple offers. So that, that in recent times has been online auctions, online offer platforms.

I really, I feel from a buyer’s perspective, it gives them. A transparency over where the bids are at. I like the transparency.

[00:28:26] Peter Fletcher: People will say, well, there’s a lot of, it creates competition. Well, yes it does. But rather than bidding against yourself, when the agent says to you and I’ve Witness this happening.

Agents have actually tried this on me. It’s like they’ll drop a number. A big number. It will give me, like 1. 25 and you’re all along thinking it’s, 1. 1. And well, no, well how about a million and twenty? Yeah. At least with the online auctions, you can see, well, there’s another, like in this one you’ve got on Westminster Street, the current offer is 9.

70, so at least, there’s a, sort of a, a flaw there.

[00:29:05] Davide Palermo: Correct. I think any time you can be transparent and open with both sides, that’s really important. And, Perth is not necessarily a traditional auction market. And, the numbers prove that. And there’s reasons for that. We know there’s legislation reasons around why we don’t do many auctions.

But I think my favourite selling method is one that gives both the buyer and the seller the opportunity to know where they stand at any particular time and not put them under the pressure of, we’re selling in one day. Welcome to the Home Open. It’s 12 o’clock. We’re taking office at 4pm. That’s not.

That happens all the time. It does happen all the time. But why shouldn’t we give people the opportunity to have a bit more time around buying what is. I’ve. pretty big investment. so my sort of strategy and philosophy is to give the home some time to breathe and that’s

[00:29:50] Peter Fletcher: normally

[00:29:51] Davide Palermo: two weekends as a minimum which is going against the norm of sold in one day, days on market, four day, whatever that might be.

And Whether it’s an online auction method or even just a priced method with a campaign running to a deadline, giving people opportunities to bring mum and dad or, their uncle who’s a real estate agent to come through and have a look at a property or at least call the agents and go, do they stand a chance?

Giving the owners that opportunity as well. Because the owners all of a sudden, hey, you’ve had one home open, we’ve got one offer, it’s a million dollars, what do you want to do?

[00:30:22] Peter Fletcher: And they’re

[00:30:22] Davide Palermo: like, I don’t know. Okay, we’ve only got one offer. How do we compare that in this market? And I don’t think my philosophy has changed much from when, when you mentioned I joined the professionals a long, long time ago.

There was no technology around this back then. And the difficulty was I would always try and get multiple offers for my clients. But you’d be talking to the second buyer and saying, You’re, winking and you’re nudging going, you need

to do a bit more with the offer. You’ve come in under the asking price, but they have no guidance around where to be.

And then you find that second buyer, misses out and calls you a month later going, I would have paid an extra five grand for that. I would have paid an extra Everyone says that.

[00:31:00] Peter Fletcher: And to a

[00:31:00] Davide Palermo: certain extent, I believe them, but they had no real guidance because we were limited. By what we can tell them in terms of pricing.

So at the moment I think it’s this transparency and it’s honesty around what we’re trying to do

[00:31:13] Peter Fletcher: Dave. I’ve seen this firsthand and experienced it where the agent has told me the number that I need to beat. What’s your thoughts on that? Because a lot of agents, they go, well, we’re not allowed to tell the buyer tell anyone what the other offers are.

And that was something that was drummed into me since the 4th of April, 1985, when I joined real estate. And, but now it’s kind of being thrown out the door. Where’s the industry at it on that subject now?

[00:31:51] Davide Palermo: I guess it depends on the campaign and the selling method that you choose. So if it’s an, a traditional auction.

And you’re there, you get to see. Everyone sees it, yep. Everyone sees that. The process of these online auctions, whether it’s through the Realtor, Sell Package, or Open Negotiation, or Rezo, that you get to see. Which

[00:32:08] Peter Fletcher: aren’t actual, actually auctions, are they? They look like auctions, they feel like auctions, but they’re, they, they, they say they’re not auctions.

[00:32:16] Davide Palermo: Yeah, so some of them are offer management platforms, so it’s dealing with the offers that are coming in. One of them is technically an auction, you the Open Negotiation. Platform is an auction. It’s signed under auction conditions, whereas Open Negotiations Offers platform is different.

That’s it’s not highest price wins. So, I guess your question was, where do we stand on telling Because they’re

[00:32:36] Peter Fletcher: just expressions of interest, aren’t they?

[00:32:38] Davide Palermo: Essentially, yeah. Essentially. And there is some, some technical difficulties with each of those. But I guess the question is, where do we stand on telling a, a buyer what the number needs to be?

And I guess as an agent. Which number are you giving them? So are you saying the other offer is one million dollars you need to be higher, or are you saying the seller would like an offer to be at a million and ten?

[00:33:02] Peter Fletcher: Mm hmm.

[00:33:02] Davide Palermo: So I think it really comes back to you’re in a difficult position if you’re doing that because what are you selling and what are you telling?

And 1985 did you say? Was that the date? April?

[00:33:12] Peter Fletcher: Fourth of April, 1985. 1985. What a fine auspicious day.

[00:33:16] Davide Palermo: So what was that based on? So that, that It’s been drummed into you that you can’t disclose this, you can’t disclose that. Is it the Reba Code of Conduct? Is it a privacy thing about the other offer?

Is it just something we’ve made up to go, this is, I invented real estate, this is the way you do it?

[00:33:32] Peter Fletcher: Yeah, well, what I was told back then was if you tell someone what the other offer is, you’ve then turned it into an auction, and If it’s an auction, then it has to be done on auction conditions. And you have to be licensed to be an auctioneer and and you’re not.

And so therefore you can’t. Disclose the offers, but what’s the current crop is, well, there’s all these expressions of interest. And I’m just going to tell you, like, the offer is the current best acceptable offer to the seller is 986, 000. It’s a

[00:34:13] Davide Palermo: very dangerous sort of place and path to go down though as an agent, isn’t it?

Because you’ve got the first offer that’s come in with good faith of I’m making an offer and no one knows what my offer is and then the second and third and fourth offer come in. So as a buyer, it’s, it’s a difficult position to go, Oh, like, should I go first? Should I go last? The cutoff time is 5 p. m. on, on Friday to submit my offer.

But then do you trust that process? What if they sell it on Thursday? So I think. When I mentioned before about we try and work to a campaign date. So whether it’s an online auction, whether it’s an end date sale, are we allowed to say end date sale? Someone trademark that? Is that still going on? Whether it’s a set date sale, I think you have to be strict with your process as an agent for credibility, for all of this stuff, because if you’re saying to someone, Hey, we’re not selling for two weekends because it is a set date sale or whatever it is, stick to that.

[00:35:08] Peter Fletcher: Stick

[00:35:08] Davide Palermo: to that process and allow people the time that you’ve said that they’ve got to come through as much as you can. And what makes that difficult to you, what makes it difficult is it’s not my home that I’m selling. I’m representing someone else, and that’s where it gets difficult.

[00:35:21] Peter Fletcher: Yeah, so the seller might get an offer of like, let’s say that all the other offers, like, Let’s take Westminster for example current offer is 9.

70. Someone rolls in Saturday at the home open and says, I’ll give you 1. 23. And the seller’s all of a sudden going, how quickly can we sign this? Yeah, of course. Because we are very happy with that number. See you later.

[00:35:45] Davide Palermo: And we have this. Thanks. Not so much anymore. I think the market has started to accept the different strategies around selling and accept auction.

But we go back to the auction days of 10 years ago, when there was a few real estate agents in the local area promoting auction. And they would have people all the time going, I hate this auction crap. I want to make an offer right now. And they would talk it down. Oh, the process is terrible, blah, blah, blah, because what’s their motive.

They don’t want to compete. They don’t want to be put into a competitive process with other buyers. They’re trying to steal it

[00:36:16] Peter Fletcher: from there.

[00:36:16] Davide Palermo: So yeah, that does happen where people come along and go, I want to make an offer. I don’t believe in the way you’re selling it. You have to submit my offer, blah, blah, blah, blah, because they would go, because back in 1985, my dad told me you have to submit the offer.

And so you go back to these, preconceptions about what you should and shouldn’t be doing in real estate. And look, some agents are, you Weaker in their personality in terms of what they believe and can get bullied and pushed around by the buyers. Quite often. Yeah.

[00:36:41] Peter Fletcher: Well, look, they, they are the people that say, we have to present my offer.

They’re actually right. You do. The code of conduct says that. But then the question is, well, what is an offer? So where you’ve got an expression of interest, where you say, you fill out one of those forms online and it says, full name, the number I want to offer, am I subject to finance?

Yes, no. Timber pest? Yes, no. Structural? Yes, no. Settlement date? Yes. Like how many days. That is, I think you would struggle to say that’s a formal offer. No, it’s not a formal offer. It’s a, It’s, it’s something close, but it’s definitely an expression of interest. And so, if it’s not a formal offer, therefore, it’s not something that would need to be, it doesn’t have to be communicated to the seller straight away.

Not that you wouldn’t, it’s just, okay, we’ve communicated to the seller and the seller’s just decided, well, they’re not going to do anything about it.

[00:37:41] Davide Palermo: And we’ve had this before where, running through these platforms, for example, sometimes we use them as an offer management tool.

It’s like, yes, place your offer through this process. It’s like an online auction. It’s just how it is. Oh, no, no. I want to submit. So I’m going to give you a real offer and get a real answer back. So what do you do as an agent? And my response is, here’s your docusign, here you go, sign that off and I’ll get your response or a non response from the seller.

Because the seller again might say, well no, no, no, who are they to tell me I have to respond to that?

[00:38:09] Peter Fletcher: My

[00:38:09] Davide Palermo: choice is to wait the seven days or the eight days.

[00:38:12] Peter Fletcher: And

[00:38:12] Davide Palermo: things like that. We talk about the market being super hot and people writing plenty of offers on properties and there’s multiple offers. Amelia, who you met the other day in our team, we had a little one bedroom apartment in a suburb and there were 36 offers made.

Jeebus. Yeah, through this offer platform. It wasn’t an auction. It wasn’t an end date sale. We were just let’s just see what we’ve got ourselves in for. And what that meant was we’re there an hour before the home open. Just to get ready and see who’s waiting at the door. And yeah, so if you’re getting 35 offers on that particular property, I lose track of how many people came through.

Can we physically write 35 contracts and should we? Like, what does the bottom person do?

[00:38:53] Peter Fletcher: Back in, back in the day, Dave, back in, my day, well, roll back to 2004, 2005 when the market was also hot. We would physically write up the offer, Sit down. in our boardroom table at 443 Albany Highway and handwrite these offers.

And like you’d write up five or six offers. per property. Now you, like, there’s no way that an agent could write up 35 offers on a property. So these offer management platforms, they’re just like an essential tool for you guys.

[00:39:32] Davide Palermo: Well, you can write the 35 offers.

[00:39:34] Peter Fletcher: You can, but it’d take an enormous amount of time.

[00:39:37] Davide Palermo: Not really. The leveraging of your technology stack in what you’re doing. So having contracts pre prepared, having just email out and it fills in information. Now, not everyone’s going to have The same conditions and things like that. So there is a few tweaks that you make, but it is a lot different to, okay, I wasn’t 2005, but I would write,

[00:39:55] Peter Fletcher: I would

[00:39:57] Davide Palermo: write every offer that I possibly could.

And that meant getting in your car and driving or faxing this stuff back and forth. Yes. I remember fax machines. And even though I’m on TikTok doesn’t mean I’m young. So, and that was the process, but that was, that’s our job. Our job is to write these offers and get contracts that are real. None of this verbal stuff that we hear that’s going on about, Oh, I’ve got an offer.

And it’s like, well, do you? Is it in writing? Where is it? I want to see it. So I think the offer management tools are there to make everyone’s job easier. Because as a buyer, signing these things also is a job. A bit of an emotional step as well as a time process. So the offer management stuff becomes a little bit easier to get some commitment out of them.

But also letting them know that the next step will be signing official documents and signing an actual contract. So, writing 35 offers when you’ve got a Strata property with 200 page Strata documents, that becomes difficult to do. Oh,

[00:40:53] Peter Fletcher: yes, that’s a, that’s a nightmare.

[00:40:55] Davide Palermo: Let’s not go down the Strata rabbit hole today.

[00:40:57] Peter Fletcher: Dave, I’m just very aware of time. We were going to talk today about about your using social media. I’m going to leave that to another, the next conversation that we have, which is going to be very soon. I think let’s just wrap it up there. Now, if people wanna use your services, how would they get hold of you?

[00:41:18] Davide Palermo: I should be everywhere. Hopefully I’m on all the social media platforms, but you can find [email protected] au. Type in my name, David with an e Palermo. I am there. Or leave a comment in wherever you’re seeing this video.

[00:41:32] Peter Fletcher: Look at you. Go, you should be my podcast.

[00:41:35] Davide Palermo: My turn to interview you now. I’m going to take over the host role.

[00:41:40] Peter Fletcher: All right. That’s all we’ve got time for folks. And Dave, thanks very much for being on board. Until next time, this has been Peter

Fletcher with the WA Property Q& A Podcast. And that wraps up another episode of the WA Property Q& A. We hope you found our discussion valuable and gained some valuable insights.

Welcome to 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.