REINZ Real Estate magazine - Autumn 2022 by reinz_info

RealEstate AUTUMN 2022

A REAL ESTATE INSTITUTE OF NEW ZEALAND PUBLICATION

$13.80 excl. GST for members

2022 — a year of recovery  Changes to the CCCFA  Could 3D printed homes fix

our housing shortage?  Proptech — drivers, trends and engagement

THE MOST VALUABLE PROPERTY IN REAL ESTATE IS PEOPLE. Professionals Real Estate New Zealand is a co-operative group founded by Real Estate people for Real Estate people. All fees paid go into providing services to our members and we aim to provide the best value experience for our owners and our clients through independent ownership and collaboration. We have core areas available across New Zealand and ownership options for businesses at different levels of maturity from start ups to multi office operations. If you are looking for a step up with a group focussed on the success of its people, go to professionals.co.nz/ownership or contact Nick Reid on 021 721 915 or nick.reid@professionals.co.nz

E V E N T S L AU N C H E S N E T W O R K I N G T R A I N I N G M E E T I N G S

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RealEstate AUTUMN 2022

A Real Estate Institute of New Zealand Publication

IN THIS ISSUE OUT & ABOUT FEATURES SECTOR GROUPS EDUCATION EVENTS TECHNOLOGY INTEREST STORIES INDUSTRY LEGAL OBITUARY

08 12 28 36 40 42 46 56 58 64

CHANGES TO THE CCCFA

18 20 24 28 34

THE FUTURE IS GREEN COULD 3D PRINTED HOMES FIX OUR HOUSING SHORTAGE?

42 46 52 58

PROPTECH — DRIVERS, TRENDS AND ENGAGEMENT AUCTIONS PAVING THE WAY IN THE MARKET FIRST-TIME HOME SELLER? MAKE THEIR FIRST ONE A GOOD ONE REINZ HOSTS ITS 2021 AGM ONLINE

2022 — A YEAR OF RECOVERY A RECORD YEAR FOR DAIRY REINFORCES CONFIDENCE 2021 IN RPM — A YEAR OF CS

BALANCING PRIVACY RIGHTS

ADVERTISE THROUGH REINZ

Become a Member Benefit supplier. Contact marketing@reinz.co.nz

The Real Estate Magazine is a quarterly publication distributed to more than 14,000 real estate professionals. Ad packages are available. If you are interested in advertising contact Eilish Emery – eemery@reinz.co.nz

Wanting to sponsor a REINZ event? Contact Holly Adams hadams@reinz.co.nz

KEY CONTACTS Real Estate Institute of New Zealand Inc PO Box 5663, Victoria Street West, Auckland 1142 Phone: 09 356 1755 Free Phone: 0800 473 469 Email: info@reinz.co.nz www.reinz.co.nz

Chief Executive

Jen Baird. Please refer all queries in first instance to Kirsty Loader, Ph: 09 356 1752, kloader@reinz.co.nz

Advisory Services

Melisa Beight, General Counsel Ph: 09 356 1760, mbeight@reinz.co.nz

Membership Team

Mary Rackham, Membership Services Manager Ph: 09 356 1750, mary@reinz.co.nz Karen Chambers, Membership Services Admin Ph: 09 356 1845, kchambers@reinz.co.nz Cindy Stowers, Membership Services & Web Admin Ph: 09 356 1849, cstowers@reinz.co.nz

Events

Holly Adams, Events & Sponsorship Executive Ph: 09 356 1755, hadams@reinz.co.nz

Communications

Marie Cahalane, Communications & Engagement Ph: 09 356 1755, mcahalane@reinz.co.nz

Education

Chris Campbell, Head of Education Ph: 09 356 1755, ccampbell@reinz.co.nz

Editors

Marie Cahalane, Editor-in-Chief; Eilish Emery, Editor; eemery@reinz.co.nz

Design and Layout

MacWork Design & Print info@macwork.co.nz

Printing Ovato Ltd

ISSN 2324-3791

Technology

Miles Fordyce, Chief Digital and Innovation Officer Ph: 09 356 1761, mfordyce@reinz.co.nz

Finance

Rowan Dixon, Chief Financial Officer Ph: 09 356 1762, rdixon@reinz.co.nz

PropertySmarts

Call REINZ Membership on 0800 473 469, option 1

DISCLAIMER: Any views or opinions included in this publication do not necessarily reflect the views of the Real Estate Institute of New Zealand Inc but remain solely those of the author(s). REINZ is grateful to the companies who have advertised in The Real Estate magazine who enable us to bring this publication to our members. However, placement of advertising in this publication does not constitute an endorsement of the products and/or services shown. Neither is REINZ responsible for the accuracy of any advertising material.

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CEO UPDATE

Entering a year of change with optimism Last year was full of challenges and adaptations for the profession — and there is no doubt what we have learned has prepared us for another big year.

Despite a nationwide move to the Red traffic light setting of the COVID-19 Protection Framework in January, borders remain open — allowing kiwis to travel and giving out of town buyers an easier path to visit and purchase homes in new locations. While a level of COVID-19 uncertainty is still felt amongst buyers and sellers, many people want to carry on with their plans and maintain some normality. As we head into Autumn, the market is expected to slow as per usual. Headwinds that have gathered over 2021 — rising interest rates, reintroduction of LVRs and changes to investor taxation restrictions — are starting to impact the market and shift dynamics. Changes to the Credit Contracts and Consumer Finance Act (CCCFA), which came into force on 1 December 2021 and are currently under review — have further tightened lending criteria. Borrowers must now provide more detail and evidence around their spending and their income when applying for loans. Feedback from several regions notes a falloff in buyer numbers — particularly first-time buyers — as a result. We delve further into the CCCFA and its impacts on page 14. I am pleased to announce that REINZ has recruited Chris Campbell as our new Head of Education. Chris will lead REINZ’s education strategy and delivery of New Zealand’s leading suite of resources and events that help drive real estate excellence across our profession. You can read more about our new staff members on page 12. There’s no better way to enter a new year than with a refreshed strategy — and that is what we have done here at REINZ. Our strategy focuses on continuing to drive best practice in real estate activity,

The Real Estate Institute of New Zealand

Jen Baird CEO, REINZ

take the next steps in our digital journey to ensure we are the leading provider of top-tier digital products and data insights, understand and advocate for an environment that enables an enduring, future-ready profession, and of course we are constantly looking at how our operations can be more streamlined and efficient, to better meet your needs. As drivers for positive change, it is wonderful to see many businesses in the real estate profession prioritising sustainability in their strategies. Sustainability has become a focus over recent years as concern about the environment grows. Signature Homes recently announced its intention to mitigate its carbon emissions related to housing construction by planting around 45,000 native trees annually — due to commence this year. You can read more about the sustainability trend sweeping the profession on page 18. Sustainability is one vehicle for change in the profession, technology is another. On page 42 we delve into how PropTech is evolving within real estate by automating, personalising and streamlining processes. It can remove friction and workload from real estate professionals when it comes to keeping their clients and customers informed and delivering customer-centric experiences. Enjoy reading this digital version of the Real Estate magazine, and I look forward to conquering another year in the profession with you all. Ngā mihi, Jen Baird

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OUT & ABOUT

Century 21 flag now flying in Northland Century 21 is now in Northland thanks to a passionate Kaipara mother and daughter with over 50 years’ real estate experience between them. Century 21 Jean Johnson Realty has opened on 6 Poto Street in Dargaville. The office will service the wider Kaipara District, including Maungaturoto in the south and Opononi in the north. “We’re proud to be flying the Century 21 flag in Northland. Our team is squarely focused on delivering exceptional personalised service, backed by Century 21’s superior brand, reputation and resources,” says Franchise Owner and Principal Jean Johnson. Jean knows the brand well. Back in 1990, she was Century 21’s first licenced salesperson in Howick, East Auckland. A few years later, she relocated to her husband's home province of Northland for a lifestyle change, but stayed in the real estate industry. “Being a Century 21 franchise means our salespeople and support staff have the best training, systems, and technology. Ultimately, that means maximum exposure for properties and the best possible price for vendors,” says Johnson.

David Faulkner joins the Property Brokers family as the General Manager of Property Management Recognised as one of the leading experts in the New Zealand property management industry, David has been involved in the industry for many years developing robust policies and procedures, trainings, and consultation services. "It's fantastic to be back at my old stomping ground leading the property management team. I am fortunate to be in the enviable position of pooling talents and working with a team of exceptional people. It's an exciting time, and I look forward to taking things to the next level," says Faulkner. "It's great to have David back in the fold. He's well-known and respected — the team is in great hands under his leadership," says Guy Mordaunt, Property Brokers Managing Director.

LJ Hooker expands LJ Hooker agents are now on the ground in more areas of the country with the opening of new LJ Hooker offices in Drury and Wanaka, and a presence in Ashburton. The office in Wanaka opened its doors in November 2021 and the team at LJ Hooker Drury joined the network in January 2022. As the most recent addition to the network, LJ Hooker Drury Principal, Brent Worthington, said the decision to join LJ Hooker was easy as he saw how passionate and supportive the network is.

Ray White Invercargill’s new purpose-built office to optimise performance Ray White Invercargill has opened a purpose-built office allowing the business to continue to grow, with staff providing the best possible service and results for their clients. General Manager Lachie Shannon said the new office would provide space for all 27 staff, including 15 experienced salespeople. “Our old office was looking tired and was no longer fit for purpose, the area we have moved to is an emerging business hub with better parking and a great cafe — which is obviously essential,” Shannon said. “It’s a new purpose-built space, with plenty of natural light, exceptional auction facilities, spacious meeting rooms and a semi-open plan design for our team to better collaborate within. “It epitomises how we position ourselves in the market — modern, stylish, premium — helping to ensure we live into our core purpose; providing an amazing experience that people will share,” Shannon concludes.

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“After a couple of meetings with LJ Hooker, we really liked what we were seeing and hearing, and it quickly became apparent that they were probably walking the talk, not just talking the talk. That has proven to be correct, and we know we made the right decision,” he said. LJ Hooker National Network Manager, Barry Grieve, said the recent growth in the network demonstrated the value in joining LJ Hooker. “This is the start of more growth for our network, and we are excited to be in conversation with business owners nationwide looking to join our family,” Grieve said.

OUT & ABOUT

Harcourts opens its 200th office in New Zealand It takes a special kind of resilience to grow what is already New Zealand’s largest real estate network during two years of exceptionally challenging circumstances. Harcourts New Zealand opened its 200th office in December, and new offices have been popping up in all corners of the country, including Smales Farm, Titirangi, Three Kings, Mount Eden, Waipu, Westport and Putaruru — with more in the pipeline for 2022. Harcourts Waipu Business Owner, Judy Guy, says joining the Harcourts brand has been a very positive move. “Over the last few weeks, we’ve had new listings coming in and being part of a nationwide brand offers us many benefits,” says Guy. Harcourts New Zealand Managing Director, Bryan Thomson says, “We are humbled by the continuation of the great support we have always received from across the New Zealand marketplace. We are a very proud 100% New Zealand owned organisation. Our values reflect our community, and we will continue to strive to meet and then exceed our team members’ and clients’ expectations. A very warm welcome to all our new team members.”

LJ Hooker Oamaru supports Waitaki Event Centre fundraising campaign LJ Hooker Oamaru has backed their community and is supporting fundraising efforts to build the Waitaki Event Centre in Oamaru. The six-court indoor sport and event centre is expected to bring several benefits to the Oamaru community, including supporting social and economic wellbeing and the community's sporting fraternity. LJ Hooker Oamaru is well-known for supporting its community, and has further committed to fundraising efforts for the Waitaki Event Centre Trust as it aims to raise $30 million to start and complete construction by 2024.

Ray White congratulates the winners of Three’s The Block NZ 2021 Ray White New Zealand — exclusive agency partner of The Block NZ — congratulated Tim and Arthur as the winners of Three’s The Block NZ 2021 after House Four sold under the hammer for $2,825,000. Ray White Ponsonby agents David Downie and Lisa Smyth said they felt privileged to market Tim and Arthur’s House Four.

LJ Hooker Oamaru Principal, Stephen Robertson, said his office will contribute a percentage of all its property sales to the Trust each month. “We expect it to significantly increase from here, with the support of our vendors who are selling through LJ Hooker making it possible,” Robertson said. “I’ve had children that have grown up that were basketballers, and we were always travelling out of town for the school events, and tournaments because there just wasn’t facilities here. “It’s going to be hugely beneficial to have this facility in Oamaru,” Robertson concludes.

“It was wonderful to market the house, and to field all the positive feedback throughout the campaign,” Downie said. “However, we are thrilled that all houses had successful results, and it was a pleasure to work with The Block NZ team. All four of The Block NZ 2021 houses in Point Chevalier sold for more than $2 million, a record for the show. Ray White New Zealand Chief Agency Officer, Treena Drinnan, said it was an “absolutely epic outcome”. “The Block NZ properties have never surpassed the $2 million mark and Ray White made The Block NZ history in terms of prices achieved, team winnings, and being on a virtual platform,” Drinnan said. AUTUMN 2022

OUT & ABOUT

Century 21 — a force in the Tūrangi Community Tūrangi’s Century 21 Premier has been at the forefront of some significant property price growth in and around the southern end of Lake Taupo — Australasia’s largest freshwater lake. “Tūrangi real estate has seen an explosion over the past three or four years, with the town of 3,000 people and surrounding area only getting more popular. Property management is also a big part of our work, keeping my tight team very busy,” says Wai Johnson, Franchise Owner of Century 21 Premier. “With Taupō nearby getting more expensive, many permanent residents and holidaymakers are opting for Tūrangi instead,” Johnson adds. Dubbed the ‘Trout Fishing Capital of The World’, Tūrangi is known for the nearby skiing, hiking, mountain biking, whitewater rafting, and boating — helped by its proximity to Lake Taupō, Mount Ruapehu, and the Tongariro River. The Sky Waka gondola on the Whakapapa ski field is also proving a visitor attraction. Like many other places, residential listings in Tūrangi remain scarce — with buyer enquiry increasing daily. Owner of Century 21 New Zealand, Tim Kearins, says key to Century 21 Premier’s ongoing success in Tūrangi has been the franchise’s very strong connection with locals and a proven commitment to giving back to the community. Over the years, the Tūrangi team has organised several annual charity evenings and Easter auctions. Fundraising proceeds have gone to the Greenlea Rescue Helicopter, St John Youth and the local Coastguard. The office has also sponsored Tūrangi's Christmas in the Park. For the Government’s nationwide COVID-19 Super Saturday vaccination day, Century 21 Premier played a starring role, supporting the local health centre’s event. “The Tūrangi office and agents have won many national and Australasian awards over the years. They continue to gain the confidence of local vendors to represent and market their properties, and they achieve great results,” says Kearins.

Harcourts Foundation reaches $7 million milestone

Long-running fundraiser, Toot for Tucker, bolsters foodbank stocks The Christmas period is notoriously busy for local charitable organisations as families struggle with the extra financial burden of the festive season. The annual Toot for Tucker fundraiser, organised by the Ashburton County Lions and supported by Property Brokers Ashburton, aims to ease some of that pressure and bolster food reserves. Despite COVID-19 restrictions, it was once again a successful event, thanks to tremendous community support. The donations were happily accepted to help those in need in Ashburton and Foxton. Property Brokers Foxton is supported by valued volunteers, including New World Foxton, the Foxton Volunteer Fire Brigade, Foxton Beach Volunteer Fire Brigade and the Te Awahou Lions, who happily gave up their time to collect the bags. Drivers, vehicles, and runners collect and sort non-perishable household grocery items to help make the event a community success.

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The Harcourts Foundation — the charitable arm of Harcourts — has reached the milestone of $7 million raised since its launch in 2008. That’s 1,078 charities supported, 356 communities impacted, and more than 970 grants made through Harcourts offices in New Zealand, Australia, South Africa and the USA. Harcourts launched the Harcourts Foundation to provide support that helps, grows and enriches its communities, with 100% of funds raised going straight to charities who need it most. Recently twelve hospices around New Zealand benefitted from more than $30,000 in specialised equipment, thanks to recent grants through the Foundation’s Hospice New Zealand Grants Programme. The grants covered costs for items ranging from oxygen concentrators and mattresses to syringe drivers and cushions for wheelchairs. Harcourts New Zealand Managing Director, Bryan Thomson, says it’s an honour to work with Hospice New Zealand on their fundraising programme. “We have huge respect for what Hospice achieves in the community, and our entire team supports the benefits that it gives to anyone who needs it,” he adds. Hospice New Zealand Acting Chief Executive, Wayne Naylor, says, “It’s gestures such as those from the Harcourts Foundation that give hospices an opportunity to fund such important items that directly benefit the last days of someone’s life.”

OUT & ABOUT

SPOTLIGHT

Whale Tales 2022 kicks off in Auckland Restriction-weary Aucklanders and visitors to the city have been able to put on their walking shoes, get outside, and embrace the opportunity to see art, ecology and cityscapes melding together to protect the Hauraki Gulf as Whale Tales 2022 kicked off in Auckland this January. Whale Tales brings a pod of uniquely designed and painted whale tail sculptures to Auckland, which aims to tell the 'tales' of New Zealand’s moana and how vital it is to have a healthy ocean. At the official launch of the four-month event, Harcourts Northern Regional Manager, Scott Cousins, said the company was excited to be involved with the World Wildlife Fund, Wild in Art and Auckland Council to present Whale Tales. Eighty large whale tails, designed by well-known and upcoming artists, are dotted around the city for seekers to find, and 80 smaller tails have been given to schools and children’s organisations to decorate and display from March — 31 of them from Harcourts business owners in the Auckland region. The large tails will be auctioned by Harcourts in early May, with all proceeds going towards preserving the Hauraki Gulf and its endemic Bryde’s whale population.

Harcourts Cooper & Co start the year running with community events After another year of disturbances in 2021 and the resulting cancellation and postponement of many events, the Harcourts Cooper & Co team were excited to start off 2022 with a wonderful community-based family event — the first of four in the North Shore Run Series.

Property Brokers' successful 'Pack the Bus' campaign Property Brokers proudly rallied the support of local communities to contribute to the Pack the Bus campaign and provide a bus load of food and gifts to support some of our most vulnerable. Despite Property Brokers and partners anxious about COVID-19 restrictions, the community spirit won amassing an overwhelming amount of support and generous donations for those in need.

The Harcourts Cooper & Co North Shore Run Series comprises four great events at four locations. Race One, which was a brand-new event for the series, took part at Western Reserve in Orewa and featured the stunning Te Ara Tahuna estuary path. Approximately 1,000 locals took part. Three more local events are scheduled, including Run Devonport at the Navy Fields/Ngataringa Park, followed by Hobsonville Point Park for Run the Point. The series will close with a return to the ’grand dame’ of summer running the Grand Finale Run Albany.

The event saw Property Brokers, Media Works, Tranzit, and Storage NZ collect donations for Palmerston North Methodist Social Services and Barnados New Zealand — filling the bus 1.5 times over. In Whangarei, Property Brokers together with MTF Finance, Whanganui Hospital, More FM, 20 Whanganui businesses, nine Whanganui schools, and hundreds of people gave generously to provide food for City Mission and new toys for Birthright. Wairarapa saw Property Brokers, together with Media Works, Tranzit Group and Mitre10 Mega, collect 5,150 Christmas presents for 1,008 children through 27 different community agencies. AUTUMN 2022

FEATURE

REINZ welcomes on board two new staff In December 2021, REINZ welcomed Miles Fordyce as the new Chief Digital and Innovation Officer, and in January 2022, Chris Campbell joined as our new Head of Education. We’re excited to bring Miles and Chris on board and hope you enjoy getting to know a bit more about our new team members.

Chris Campbell

Miles Fordyce

Head of Education

Chief Digital and Innovation Officer

REINZ’s new Head of Education, Chris Campbell joins the REINZ Senior Leadership Team, and will lead the education strategy and delivery of New Zealand’s leading suite of resources and events to help drive real estate excellence across the profession.

Miles joins the REINZ Senior Leadership Team and will oversee the delivery of REINZ’s digital transformation and our digital products and services.

Throughout his career, Chris has worked extensively with leading training providers and has a strong background in general management and sales of professional services — focusing on training, change management and programme management. Before joining REINZ, Chris was a Director of CCA Ltd, where he provided consultation services in the education sector. He has also worked as the National Sales Manager and, for a period, the General Manager of leading training providers Axiom Training. Chris held management positions across sales, planning and business development at AMS Group, and also worked at Evolve Consulting and Training as Director, supporting national and international logistics companies. When he’s not implementing education strategies, Chris loves to spend time with his family, keeping fit and trying new activities. The Auckland local recharges his battery by riding his motorbike and enjoys learning new and engaging ways to connect with people.

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The North Shore local has a diverse background in technology, with leadership roles in various industries in New Zealand and Australia. His expertise spans digital strategy and innovation, IT strategy, service risk and assurance, operational excellence, and digital transformation. His most recent role was at Tower Insurance, where he headed Data and Practice Management. Prior to Tower Insurance, Miles was Head of Operations and Enterprise Services at Foodstuffs North Island and has held senior positions at Auckland Transport and New Zealand Post. Miles enjoys spending his spare time gardening or renovating his house where he lives with his wife and two sons, along with their cat, who goes by the name Inky, and their turtle, George.

r e e r a C At Harcourts, you’ll take your career to the next level with the backing of OUR TEAM.

021 3-2 201

Re al E i es state Ag enc

As a Harcourts Business Owner, your talent and ambition will be backed by world-class systems, support and a team of people dedicated to your success. If you’re looking to achieve the next level in your career, join New Zealand’s largest real estate company.

Find where you belong.

harcourts.co.nz/joinus | Tim Glatt 021 777 269 Harcourts Group Ltd Licensed Agent REAA 2008.

FEATURE

Changes to the CCCFA On 1 December 2021, changes to the Credit Contracts and Consumer Finance Act 2003 (CCCFA) took effect. The prescriptive regulations set out how a lender verifies whether a loan is suitable for a borrower, and whether a borrower can afford the repayments. Lenders must now show how they came to the decision when calculating each borrower’s affordability and suitability under the new regulations.

These changes tightened the lender’s responsibilities under the CCCFA by increasing the level of investigation a lender must undertake to ensure a loan meets the borrower’s needs, ensure borrowers can afford the loan repayments and that borrowers are making a properly informed decision. The objective of the reform is to protect everyday kiwis from incurring unaffordable debt.

What it means for lenders The new lending requirements are necessary for all types of lenders — banks, payday loan providers and mobile traders. Although lenders are already required to question loan affordability, they will now need to abide by a stricter process involving further information verification and transparency regarding calculation of any fees or charges. Lenders can no longer rely on the fact that information has been provided by the borrower to show that they have made reasonable inquiries about the affordability and suitability of a loan — they will need to scrutinise the information given further. For instance, a lender examining mortgage eligibility will need to follow a process that specifically verifies information that a borrower has provided — such as household expenses and income — and then authenticate these details with supporting evidence. Adjustments will need to be made where necessary, especially where the supporting evidence does not match the expense and income disclosed by the

The Real Estate Institute of New Zealand

borrower. If a lender has failed to assess this specific information appropriately, they risk harsh penalties that, under the new regulations, have become significantly more severe. Whilst these additional steps give borrowers a few more hurdles to jump over, it does have the underlying aim of safeguarding borrowers from ending up in prohibitively high debt.

What it means for borrowers Buyers looking to secure a loan are now required to provide bank statements or other proof of income, such as payslips. They will also need to be prepared for lenders to make detailed inquiries about their objectives, personal details and requirements to take out the loan. Providing this additional information to supplement the investigations has resulted in loans taking longer to be approved — and many buyers missing out. According to media and anecdotal accounts from REINZ members across the country, whilst the changes were to protect vulnerable borrowers, it has instead prevented many potential buyers who would have previously qualified for loans from getting approval. Unsurprisingly, this is a significant impediment for first home buyers, many of whom were already at a disadvantage due to rising house prices. Within the real estate profession, the legislative changes will affect all home loan applications.

FEATURE

Borrowers are advised to plan ahead and be patient, despite frustrations. To speed up the process, borrowers will need bank statements for the accounts used to pay expenses reaching back 90 days, evidence of income (if not reflected in bank statements, pay slips or employer contracts are required), and a clear understanding of how much they spend each month on expenses such as food, utilities and travel. It is also wise for borrowers to prepare a plan on how they could alter their spending if they are to receive the loan.

Given the impacts on potential buyers, REINZ supports the inquiry ordered by Commerce and Consumer Affairs Minister, David Clark, into whether banks have overreacted to new lending rules. The Minister has asked the Council of Financial Regulators to bring forward their investigation into whether banks and lenders are implementing the CCCFA as intended. The initial advice is anticipated in mid-April, followed by further analysis in April. We will keep our members updated on this investigation and what may come of it.

A cause for reconsideration In REINZ’s view, the CCCFA amendments, although no-doubt well-intended, require reconsideration. This is based upon member feedback from across the country that the reforms are having a negative impact on capable borrowers. Members have reported a decrease in first home buyers and increased caution and confusion in the market due to uncertainty about their financial resources.

WITHIN THE REAL ESTATE PROFESSION, THE LEGISLATIVE CHANGES WILL AFFECT ALL HOME LOAN APPLICATIONS. AUTUMN 2022

FEATURE

Nelson and Tasman CLIMBING THE LADDER OF THE SOUTH James Murray, Senior Communications Advisor, Nelson City Council

CBD Trafalgar-Bridge Intersection. Concept only — not actual design.

In 30 years, where will Nelson work, live and play? This South Island hot spot is set to see substantial growth in preparation for expected residential and business expansion.

With shops, cafes and restaurants lining Bridge and Hardy Streets, space for people to relax at pedestrianised Upper Trafalgar Street, a thriving museum, popular cinema and a humming weekend market — Nelson is the destination city at the top of the south. Over the next 30 years, Nelson’s city centre is expected to increasingly become a place to live and visit as people look past the quarter-acre dream in favour of a city-centre lifestyle.

Nelson and Tasman’s Future Development Strategy In preparation, the Future Development Strategy (FDS) was implemented — a joint project carried out by Nelson City Council and Tasman District Council, which looks at where and how development will occur in the region over the next three decades. The strategy identifies locations suitable

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for growth, for residential or commercial development, and areas suitable for intensification and new greenfield opportunities to meet increased housing demand. Following engagement with the development community, youth councillors, iwi and hapū, 200 sites across Nelson and Tasman were recently assessed as potentially suitable for future growth. The strategy is now being written and will be out for full public consultation this March. Judene Edgar, Urban Development Subcommittee Chair, says certain themes emerged early in the engagement, particularly, intensification and the protection of highly productive land. “Proximity to public transport, work and other amenities also featured in the engagement, as well as affordability and what Councils can do to help,” Edgar adds.

FEATURE Housing affordability initiatives are key Nelson City Council made housing affordability and intensification a priority in its latest Long Term Plan. Some of the proposals in that plan are now starting to take shape. “We consulted on selling property owned by Council, close to the city centre, for development projects that would increase the supply of affordable housing in Nelson,” says Edgar. “Our recent decision to sell land to Kāinga Ora is one of the first examples of this policy. If it goes ahead, commercial property on the outskirts of the city centre will be transformed into up to 175 affordable housing units.”

Fostering a new and improved city An intensified city also needs to work for its residents. Vibrant streets and laneways are crucial for existing and future residents in the city centre. Te Ara ō Whakatū, Nelson’s City Centre Spatial Plan, is a vision for Nelson’s city

centre over the next 30 years. At its heart, the plan puts people back at the centre of the city, with a goal to see 2,000 people living in the city centre by 2050. “Ideas in the plan include a lush, green linear park on Bridge Street, streets that prioritise pedestrians, better links to other precincts such as the marina and library, revitalised and reimagined laneways, public art that inspires fun and imagination, better facilities for young families, and more comfort and access for older adults,” says Edgar. Intensification for residential living in the city centre will not be enough to ensure Nelson and Tasman can meet increased demand for housing and commercial property.

A $490 million infrastructure budget over the next ten years is geared towards increasing housing capacity — not just in the city centre but also in the surrounding suburbs and Stoke. Creating and maintaining a water network that can handle expected population growth — and the demands placed on it due to climate change — go hand in hand with improvements to public and active transport systems when it comes to increasing housing options. “We know that greenfield development will also be necessary if we are to succeed in alleviating the effects of the housing crisis; the FDS will look at the best places for this to occur,” concludes Edgar.

WE CONSULTED ON SELLING PROPERTY OWNED BY COUNCIL, CLOSE TO THE CITY CENTRE, FOR DEVELOPMENT PROJECTS THAT WOULD INCREASE THE SUPPLY OF AFFORDABLE HOUSING IN NELSON.

151 Nayland Rd

For more information on the 2022 Nelson Tasman Future Development Strategy, visit: www.shape.nelson.govt.nz/future-development-strategy or fds.nelsontasman.govt.nz/.

AUTUMN 2022

FEATURE

The future is green — a sustainability mindset Growing concern about environmental issues and climate change is shifting the mindset throughout the real estate industry. Demand for real estate and construction companies that practice sustainability is rapidly increasing and is expected to become even more of a priority for real estate companies in New Zealand.

With the Government’s green initiatives, in tandem with buyer preference for carbon-conscious companies, many real estate and construction businesses are implementing sustainability-centric initiatives.

Why a shift to sustainability? The influence of green building standards in New Zealand has been driven by consumer demand more than regulation, unlike some countries in Europe and the UK. However, in 2020, the Government announced plans to transform and reduce pollution — catalysing sustainability further, which led to the introduction of the Building for Climate Change programme. According to the New Zealand Green Building Council (NZGBC), buildings and their construction account for as much as 20% of New Zealand’s emissions. For our country to reach its climate change goals, including net zero carbon by 2050, changes must be made within the building and construction sector. Energy efficiency and carbon emissions are crucial considerations when building sustainably, and buildings are now designed and constructed to use minimal energy and water, which will reduce greenhouse gas emissions. Following the Building for Climate Change programme, the NZGBC implemented its own zero carbon roadmap for the country’s buildings. In July 2021, they stated that following the introduction of the Building for Climate Change Programme and the NZGBC’s own zero carbon roadmap, 20 buildings achieved Green Star certification, over 1,100 new homes were awarded Homestar certification, and nearly 20,000 homes utilised the free HomeFit check.

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Green Star certification — the new tick of approval Originally created by Green Building Council Australia and then adapted for New Zealand, Green Star is a holistic sustainability rating system for buildings, fitouts, and communities. The rating is available for all commercial building types, including schools, office buildings, and shopping centres. When a building is Green Star certified, it means it has met best practice sustainable design and build indicators — differentiating companies who meet Green Star requirements from companies who convey a false impression about their sustainable methods. Lloyd Budd, Director of Bayleys Commercial and Industrial in Auckland, says a five Green Star rating is now the norm for many large, new office buildings and other warehouse and commercial buildings. Partnered with NZGBC, Bayleys is committed to rating its commercial and industrial premises with a NABERS rating (a system for rating energy efficiency of buildings) — and they are encouraging their customers to do the same. “As a New Zealand-owned, family company, the idea of sustainability fits the values of our owners,” says Budd.

Sustainability key for New Zealand construction companies It’s in the name — Green Homes New Zealand has embraced green initiatives. The international residential building company takes sustainability and its carbon footprint seriously by incorporating practices and systems that minimise

FEATURE

impact on the environment, reduce running costs, and make homes healthy, accessible and comfortable. Mandy Stephens, Sales Manager at Green Homes New Zealand, says she has noticed an increase in buyer interest for sustainable properties in recent years. “Many people have adopted a passion for the environment after raised awareness of climate change. Not only this, but buyers have the desire to reduce ongoing heat and cooling costs,” says Stephens. Signature Homes has also recently announced its initiative to mitigate its construction CO2 emissions by planting around 45 native trees for each new build in partnership with Trees That Count. Their CO2 reduction plan began with a gift of 6,615 trees to Trees That Count to cover sales in November and December 2021. Paul Bull, Chief Executive at Signature Homes, expects they will plant around 45,000 trees annually, which will absorb around 19,000 tonnes of CO2-equivalent emissions over 50 years as those trees continue to grow. “We currently sell approximately 1,000 homes a year and realised that results in a significant carbon footprint.

WE WERE DETERMINED TO MAKE OUR CONTRIBUTION TO NEW ZEALAND’S GOAL OF BEING CARBON-NEUTRAL BY 2050 AND BUILD A BETTER FUTURE FOR KIWIS. “We were determined to make our contribution to New Zealand’s goal of being carbon-neutral by 2050 and build a better future for kiwis,” Bull says. With companies like Signature Homes and Green Homes New Zealand leading the pack, many remain hopeful that other companies in the industry will jump on the green bandwagon. “We are working with our long-standing suppliers to identify more environmentally friendly building products, with a goal of using these as standard in everyday construction — but also offering our clients additional product options that allow them to make more sustainable choices,” concludes Bull.

We still have a way to go Reducing emissions and creating new ways to be sustainable will require commitment and innovation within the real estate sector. There are many complexities and questions to solve at a sector and individual property level — including whether there is a sustainable way to modify older, highenergy consuming properties, and limit the carbon emitted to create processes for better energy efficiency. Short-term policies contributing to New Zealand’s goal of net zero emissions by 2050 will be unable to keep up — so it is vital all companies in the sector do their bit and commit to a sustainable and green future. A ‘Clean and Green New Zealand’ has never been more relevant. AUTUMN 2022

FEATURE

Could 3D printed homes fix our housing shortage?

Collaboration between humans and technology through 3D printing could be the solution we need to balance the property market’s supply and demand issues.

For many kiwis, owning a house is a significant milestone — the gravitas of which is instilled in each generation. Unfortunately, with demand currently outweighing supply, stricter lending criteria, and rising house prices, owning a home remains a pipe dream for many New Zealanders. According to a recent REINZ and Tony Alexander Report, 26% of respondents reported that the lack of listings in the market is worrying. The scarcity of options on the market often culminates in fear of missing out on properties, and in turn, some people who can afford to buy a home settle for lower quality properties.

A nationwide shortage of labour and materials The market is not only experiencing a shortage of stock in the market — but a shortage of labour in our construction sector. The productivity and efficacy of current traditional construction methods are putting pressure on the amount of time it takes to build a house or develop a section. Current construction methods are heavily reliant on manual labour and human capabilities, making it challenging for the construction industry to keep pace with demand — too many houses to be built and not enough manpower to do it. To add to that problem, we also have a shortage of materials in New Zealand. Due to COVID-19, we’re balancing supply chain disruptions and shortages of labour with increased demand as people bring forward their renovation plans and put their travel plans on the backburner. At the same time,

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residential building consents have hit a new high.

Technology is key With these factors impacting the opportunities for kiwis to purchase or build a home, construction companies are beginning to consider new building methods. One that stands out is Additive Manufacturing — also known as 3D printing. It’s a method that combines the knowledge of traditional construction with digital fabrication. An object is created by depositing materials in layers based on the digital model of the design with minimal human intervention needed. Originally, 3D printing was used for small-scale prototypes such as furniture, interior walls, built-in wardrobes and doors, which are then delivered and added to the shell structure of the house. Advances in technology have led to the creation of full-scale structures. Now, 3D printing a house is done by a manoeuvrable robotic arm that deposits the material forming the structure of the house layer by layer on-site. Innovative robotics does the majority of the labour, relying heavily on design software for precision and using advanced materials that are stronger and longer lasting than traditional building materials. This technology can provide modern, safer, and more resilient homes built to sustain harsh weather conditions, fire, and earthquakes — in a remarkably shorter amount of time. In fact, 3D printed houses only need a few days or weeks to be built and/or assembled.

FEATURE Reducing costs and carbon footprint The economic benefit of 3D printing is significant — it can reduce the overall capital costs by almost 30% compared to traditional construction methods (depending on the complexity of the design). With the integration of other trades and services already coordinated with the structural design, this technology can lessen the time spent on-site, thus, reducing labour costs. 3D printing also has crucial environmentallyfriendly attributes — reducing waste and carbon footprint, using recyclable materials and less energy. 3D printing only uses the necessary amount to make the structure by adding material instead of subtracting it from a block of material and leaving excess material as waste.

The turning point Most major cities in the world are faced with the same need to build more houses, more efficiently. Countless innovators have found themselves drawn by the idea of being able to print a structure and have spent years trying to scale the technology. But, for all their efforts, 3D printing has

THE PRODUCTIVITY AND EFFICACY OF CURRENT TRADITIONAL CONSTRUCTION METHODS ARE PUTTING PRESSURE ON THE AMOUNT OF TIME IT TAKES TO BUILD A HOUSE OR DEVELOP A SECTION. proven to be difficult and many impressive prototypes have struggled to become viable for mass production. However, things have taken a massive step forward in the United States. In Texas, a collaboration between home builder company ICON and construction technology company Lennar, has committed to building the largest neighbourhood of 3D printed homes in America. They have started to build houses that are 1,000 to 2,000 square feet and range from two to four bedrooms — with flexible and functional floor plans and a minimalist architectural aesthetic. We’re beginning to see other countries implement 3D printed homes, including Canada, Netherlands and Dubai. In fact,

Dubai aims to use this technology to print a quarter of its new buildings by 2030. This advancement in technology already exists in New Zealand. We have plenty of companies that offer small-scale 3D printing services to support other industries — but, we also have companies like Qorox that offer full-scale printing of commercial and residential properties. Many people are unaware that there are other building methods available for them to choose from. As this method continues to advance in other countries, it’s only a matter of time until it is integrated into our solution to the current shortage of housing. Then, what was once a dream may suddenly become a possibility for kiwis wanting to own their own home.

AUTUMN 2022

FEATURE

Making homes inclusive for all

A home should be a sanctuary. A place that feels comfortable, safe, happy, and above all, is suited to one’s personal requirements. It is important that all New Zealanders, no matter their ability, can live in a property or a rental that is inclusive of their needs.

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Most homes tend to be designed for able-bodied adults, and too often, the needs and preferences of those who are elderly, or disabled are neglected.

abilities change, which is why it is crucial for a home to be a comfortable and reliable environment that promotes independence and is suited to the residents’ needs.

According to the New Zealand Disability Survey, almost one in four New Zealanders identified as having a disability in 2013 — a total of 1.1 million people. This is an increase of 20% when compared to the previous survey conducted in 2001. Although this is partly explained by our aging population, in which the survey demonstrated that those aged 65 and over had a higher likelihood of being disabled than younger adults and children, it also applies to elderly people in general. As a person ages, their functional

So, how do we make sure that elderly people and those with a physical impairment can live in a home that is inclusive and allows them to live independently?

Creating an accessible living environment The answer is to create accessible living environments through a concept called universal design. A human-centred approach to design, universal design recognises that

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IN TWO ALREADY COMPETITIVE MARKETS, THE POOL OF SUITABLE HOUSING FOR PEOPLE WITH A DISABILITY IS VERY SMALL. a well-designed home meets occupants’ physical and other needs whilst focusing on increasing the quality of life for all. Products and environments are designed for everyone — no matter their ability. Universal design elements can be incorporated in the beginning stages of a new build or applied to an existing home. Incorporating universal design elements will also make it easier and safer for family members or caregivers to assist elderly or disabled loved ones. Paralympic bronze medallist, Rebecca Dubber, struggled to find an accessible place to live when renting in Auckland. When looking to purchase her first home, she encountered this same issue — she could not find a house built for someone with a disability. “The whole process of finding somewhere to live that was accessible and functional to my needs was incredibly stressful, and in two already competitive markets, the pool of suitable housing for people with a disability is very small,” she said. The Auckland local is a wheelchair user and says that education around accessible and inclusive design in homes, like universal design, is critical. She hopes to see it utilised more widely.

Principles of universal design Universal design is not a new trend. It’s a concept that was developed in 1997 by the late Ronald Mace, who led a group of architects, product designers, environmental design researchers and engineers in creating products, systems and environments that are user-friendly and accessible for everyone. The principles of universal design embrace human diversity and apply to all design specialities. They are:  Equitable to use  Flexible to use  Simple and intuitive use

 Perceptible information  Tolerance of error  Low physical effort  Size and space for approach and use. These principles guide the design process of built environments, products, and communications. They allow systematic evaluation of designs — a checklist to measure the accessibility of building designs. The principles also assist in informing designers and users about the characteristics of other potential usable design solutions.

it’s the television, lights, heater, or garage doors, with little to no effort. Having an accessible home, designed according to universal design standards, increases its competitive edge by attracting a wider range of potential buyers. It also provides the reassurance of planning for the future with its ability to make buildings and homes accessible to all people at any stage of life, meeting its occupants physical and aesthetic needs, minimising compromise and ensuring its occupants’ independence.

Universal design in action There are plenty of universally designed products that we use every day. One example is the automatic doors in entrances of most commercial properties. These provide a ‘hands-free’ entrance that opens by sensor. The approach benefits all — from a multi-tasking mum with her hands full to a wheelchair user. Here are more examples of universal design:  Task lighting and light sensors: Lights will automatically turn on when someone enters the room or off if the space is empty  Touch-to-open drawers and cabinets: Reduces muscular stress when pulling a drawer open from an awkward angle as it will open with just a light touch  Cabinet plate drawer: A large drawer that stores plates and bowls to reduce the need to reach very high or low places. Also, less clutter in the kitchen reduces the chance of accidents  Wider entrance and pathways: Providing space for a wheelchair user or people carrying groceries or other objects  Hospital beds: A bed that adjusts in height, so it’s easier for the patient to sit or get on or off the bed  Universal remotes: Activates and controls certain features of your home, whether AUTUMN 2022

FEATURE

2022 — a year of recovery

Shyamal Maharaj, Economist, Auckland Council

Gary Blick, Chief Economist, Auckland Council

House prices are a constant hot topic amongst kiwis, and this year is no different. Prices have continually risen, and lower finance costs have been a factor as interest rates were lowered to mitigate risks to the economy from COVID-19. These factors along with stricter lending conditions, housing supply increases, and uncertainty around COVID-19 will pave the way for an interesting 2022.

Affordability challenges, worsening wealth inequality Auckland’s median sale price hit an all-time high of $1.3 million in December 2021 — leaving many baffled by the strength of the market during a pandemic. While owners may welcome record prices and increasing property values, 40% of Auckland households do not own their homes and, therefore, may be less ecstatic about the current rate of price growth. The dream of purchasing a home is moving further out of reach for some people — including those who rent or live with family and those yet to form a household. Affordability has worsened as house price growth now exceeds income growth, increasing the difficulty of accumulating a deposit. First-time buyers who make a purchase will likely be devoting more of their working years to servicing a larger mortgage. Overall, a rapid and sustained rise in house prices represents a large transfer of wealth from non-owners to owners, thereby increasing inequality and presenting risks to social cohesion.

How long can this go on? Perhaps not for much longer. Higher interest rates are looming, with the Reserve Bank signalling further rises to the Official Cash Rate throughout 2022. Although interest rates remain at relatively low levels, the impact of mortgage rate rises will weigh on some buyers at the

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margin. First home buyers may find the amount they can borrow is reduced, while some investors may face pressures from increasing interest costs. Approximately 60% of residential mortgages are fixed for a 12-months or less term, of which half are fixed for six-months or less. Thus, most mortgage holders will feel the impact of higher interest rates this year. Additionally, tougher lending conditions are in place to protect a financial system that is heavily exposed to housing assets and mortgages — for example, higher capital requirements for banks, debt-to-income ratios, and amendments to the Credit Contracts and Consumer Financing Act 2003.

Housing supply set to increase There are signs that Auckland’s housing supply is responding to demand, with a large pipeline of dwellings consented. Over 20,000 dwellings were consented in the year to November 2021, setting a 12-month record — an increase of 26% year-on-year. In part, this is a response to higher prices with the commercial feasibility of some developments being improved. While there are construction lags, this is welcome, as Auckland has had a substantial and persistent shortfall that will take time to address. This year, Government housing policies will be implemented, namely, the National Policy Statement on Urban Development and Medium Density Residential Standards.

FEATURE

These policies aim to enable greater density in areas where people want to live, providing more choice to buyers and encouraging a more compact urban form. The cumulative effects will be visible in the medium term, with more housing options in the areas near jobs, amenities, and good public transport — particularly frequent and rapid services.

Uncertainty arising from the pandemic COVID-19 may impact the ability of the construction sector to deliver new housing in the near term, contributing to a labour shortage and supply chain constraints that lead to delays and cost escalation. Nevertheless, construction sector activity is expected to play a key role in post-pandemic recovery.

welcome, there is a space-cost trade-off, particularly given elevated prices and affordability challenges. Working from home may allow some people the freedom to live further away from their jobs. Balancing this, most people will still go to a workplace, depending on the industry and value gained from the interaction. The trade-off of location with travel time may count against changes in demand for housing location, particularly if the behavioural effects of the pandemic are short-lived.

2022 should see prices ease On balance, the prospect of higher interest rates and an increasingly responsive housing supply should contribute to house prices easing in 2022.

Lockdowns and community outbreaks have had short-term dampening effects on sale volumes. Associated with this, online property traffic is reportedly surging. While some people rely heavily on open homes, it appears that selling and buying property online is becoming easier.

Alongside this, there are potential counterbalancing factors, such as the constraints and uncertainty arising from the pandemic. Nevertheless, housing affordability is likely to remain a pressing issue.

Flexible working may not change demand

ALTHOUGH INTEREST RATES REMAIN AT RELATIVELY LOW LEVELS, THE IMPACT OF MORTGAGE RATE RISES WILL WEIGH ON SOME BUYERS AT THE MARGIN.

The pandemic has forced people to work from home, where possible, intensifying a trend enabled by technology. Some households have the capacity for a home office, but many struggle with space. While more floor area for a home office may be

AUTUMN 2022

FEATURE

Ensuring a positive home-buying experience for new kiwis

Pedro Morgan, Lead Advisor, Overseas Investment Office, Toitū Te Whenua Land Information NZ

Let’s set the scene. You’ve just helped a client sell a house — vendor and purchaser have signed on the dotted line and, as settlement approaches, you’re about to send your client a gift to say thank you. Then you receive a call from your very unhappy and stressed-out client.

They call to inform you that settlement is delayed, bridging finance is required to pay off two mortgages, lawyers are involved, legal fees are rising, and the Overseas Investment Office (OIO) is asking questions.

Overseas Investment Act provides a clear legal process for people wanting to make New Zealand their permanent residence, and apply for permission to buy a home to live in.

Your client is stressed. You’re stressed.

Understanding who needs consent and who doesn’t

Why? Because the agreement wasn’t conditional on consent from the OIO, and it needed to be.

‘Overseas persons’ need consent. An overseas person is an individual who is not a New Zealand citizen, and not ‘ordinarily resident’ in New Zealand. Permanent residents may still be overseas persons and need consent.

Some aspects of the consent rules aren’t always well understood. Unfortunately, that sometimes sees buyers breaking the rules without realising it — especially in an active market where people tend to move quickly to secure a property. In situations like these, a well-informed real estate agent can make all the difference in helping people navigate the rules and seek the right legal advice.

Helping new kiwis buy a home New Zealand’s population reflects a growing diversity where large communities from many different parts of the world are now proud kiwis and call New Zealand home. Since 2018, overseas buyers have needed Government consent before buying residential land in New Zealand. The

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People who are New Zealand citizens or are ‘ordinarily resident’ in New Zealand can buy real estate here without the need for consent. Whether a person is ordinarily resident depends on their visa status and how long they have been in New Zealand. The OIO’s website has more information on how we define ‘ordinarily resident’. Australian and Singaporean citizens (with some restrictions) can also buy certain residential property without consent because of our free trade agreement obligations with those countries. There are also exemptions for relationship property under the Overseas Investment Regulations 2005. Legal advice is recommended in these cases.

FEATURE Who can apply for consent? People who are committed to living in New Zealand and are on the road to living here permanently can apply to the OIO for consent to buy a home to live in. To qualify, people need to hold a residence class visa and intend to make the property their main home. If they don’t hold a residence class visa or don’t intend to live in the property, they will not get consent.

Conditional offers Consent is required before a contract is entered into unless the contract is conditional on consent being granted. Buyers in a competitive market might want to make their offer subject to as few conditions as possible to make it more attractive. It is very important for buyers who require OIO consent to have that listed as a condition of their offer. If they don’t, they will breach the Overseas Investment Act and may be penalised.

Buying at auction Auctions are a popular option for vendors selling in an active market. Auctions, however, present some significant issues for people who need consent from the OIO. Consent is required before the auction unless the vendor has agreed to the person’s bid being conditional on consent being granted. An overseas person who wins an auction without consent will breach the rules.

Getting consent sorted The good news is that applying for consent is a simple process. Buyers can apply for pre-approval to buy a home to live in. Consent is valid for a year, but can only be used to buy one home to live in. This means they can make fast offers with fewer conditions and bid at auctions with confidence.

meet the criteria to be granted consent but have inadvertently breached the rules may be eligible for retrospective consent.

encourage them to contact Toitū Te Whenua Land Information New Zealand so we can work with them on a solution.

Resolving problems

However, this is best avoided as it requires more paperwork and is expensive — involving a penalty of up to $10,000. This would be on top of the application fee and any legal advice required, without any guarantee of getting consent.

Any deliberate breaking of the law is always treated seriously. However, people who

If you become aware that someone has inadvertently breached the rules, please

As Toitū Te Whenua’s head of regulatory practice and delivery, Rebecca McAtamney has management oversight for the overseas investment regime, the Surveyor General, the Registrar General of Land, Valuer General and the Commissioner of Crown Lands.

Applying for pre-approval is straightforward and done online via the Toitū Te Whenua Land Information New Zealand website.

More information on the requirements for buying a home to live in and New Zealand’s overseas investment regime is available on the Overseas Investment Office website www.linz.govt.nz/overseas-investment. For further information on purchasing a home in New Zealand for an overseas person go to www.newzealandnow.govt.nz/live-in-new-zealand/housing/buying-or-building. To apply for preapproval visit www.oio.linz.govt.nz/one-home-to-live-submission. If in doubt, please get in touch with us at Toitū Te Whenua Land Information New Zealand www.linz.govt.nz. AUTUMN 2022

SECTOR RURAL

A record year for dairy reinforces confidence in the sector The dairy sector saw record milk production volumes last season, despite a fall in the number of cows. With a new aim to produce with less, the dairy sector is moving towards a more sustainable future and adapting to a labour shortage which has forced farmers to become more efficient in their work. Success in the dairy sector instils further confidence in investment in rural land around the country.

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RURAL SECTOR The dairy sector is known for its immense contribution to the economy, including investment in dairy processing plants and finance through dairy farming loans from larger industries and construction. The sector also contributes greatly to the regional economy through links with supporting sectors such as freight transport, storage, packing and agricultural services.

million cows, or 76.2% of the national herd). Herd testing enables farmers to monitor and improve the quality and productivity of their herds.

DairyNZ Chief Executive Tim Mackle, says that dairy plays a significant role in New Zealand — the sector employs around 50,000 kiwis and was estimated to contribute over $37 billion to the economy in 2020-21.

“Mating season has always been an important time to get cows in-calf, but with a focus now on cow quality over quantity, more farmers are investing in premium genetics to help ensure their next generation of replacements is more efficient than the last.

With the world in a state of adjustment amidst a pandemic and climate change, the dairy sector — like so many sectors in New Zealand — has needed to adapt its processes.

More milk — less cows A new focus on breeding higher-performing cows — playing true to the adage ‘quality over quantity’ — saw kiwi farmers hit a new high for milk production last season, with fewer cows. The annual New Zealand Dairy Statistics report, released by DairyNZ and Livestock Improvement Corporation (LIC), shows that total milk volume, total milk solids and per cow production were the highest on record in the 2020-21 season. Mackle says it is great to see a continuation of the ‘more milk from fewer cows’ movement as it shows a continuing focus on milking better cows and farming more sustainably. “Farmers are focused on developing more productive and efficient cows and farming systems, with a lighter environmental footprint. They want to retain our unique pasture-based farming system and remain world-leading.” Favourable weather conditions also contributed to good grass growth, while higher milk prices meant many farmers extended their milking season in 2020-21. The percentage of cows mated to artificial breeding rose to 71.3% (up from 70.8% in 2019-20), and the number of cows herd tested is the highest on record (3.735

LIC Acting Chief Executive David Hazlehurst says the greater uptake of herd improvement services demonstrates farmers’ intent and focus on producing the most sustainable and efficient animals.

“It’s really pleasing to see these stats provide farmers with reassurance that the tools they’re investing in to increase their herd’s production efficiency and reduce their farm’s environmental footprint are working. Increasing milk solids with a reduced cow population is an achievement the whole sector should be proud of,” concludes Hazlehurst.

Dairy sector and rural real estate So, what could the ‘more milk fewer cows’ trend mean for the demand for rural real estate? According to REINZ’s January 2022 data, dairy farms have seen steady growth compared to January 2021. In fact, 1,710 farms were sold in the year to January 2022 — 169 more than were sold in the year to January 2021, with 79.1% more dairy farms, 28.8% less dairy support, 2.9% more grazing farms, 6.2% more finishing farms and 10.8% less arable farms sold over the same period.

“The latest Dairy Statistics report shows that despite a range of challenges such as the COVID-19 pandemic and staff shortages, farmers are working hard to keep milk production flowing, and this benefits every kiwi,” concludes Mackle.

IT’S REALLY PLEASING TO SEE THESE STATS PROVIDE FARMERS WITH REASSURANCE THAT THE TOOLS THEY’RE INVESTING IN TO INCREASE THEIR HERD’S PRODUCTION EFFICIENCY AND REDUCE THEIR FARM’S ENVIRONMENTAL FOOTPRINT ARE WORKING.

Further, the median price per hectare for dairy farms has increased 31.8% over the past 12 months. The increase in farm sales for the 2021-22 calendar year shows continued strong demand in the investment of rural land — reflecting the current level of confidence in the agriculture and dairy sector. However, increasing costs, labour shortages and supply chain difficulties are constraints that continue to challenge the rural and dairy industry. Tim Mackle, Chief Executive at DairyNZ, has seen this first-hand.

DairyNZ is the dairy industry organisation that represents all dairy farmers — supporting farmers through investing in research, resource development, extension and advocacy to ensure they lead the world in sustainable dairy farming. Head to www.dairynz.co.nz. LIC is an agri-tech and herd improvement co-operative which empowers livestock farmers through the delivery of superior genetics and technology. Visit www.lic.co.nz to learn more.

AUTUMN 2022

SECTOR COMMERCIAL & INDUSTRIAL

Getting the job done — a hybrid style BAYLEYS REALTY GROUP LIFTS THE LID ON HYBRID WORKING MODELS AND THE NEW LEASE OF LIFE IN THE POST-COVID OFFICE SPACE.

Reflecting on the past two years of disruption for office-based businesses, the way forward will involve balance, flexibility, and an ability to embrace hybrid working models that serve business owners and their teams.

Lloyd Budd, Bayleys Director Auckland Commercial and Industrial, refutes the opinion of some commentators that the days of the physical centralised corporate office are numbered, pointing to development pipeline data as evidence that the office workplace is very much alive. Prime office space remains sought after — in particular, premium rents are being obtained for A-grade spaces with amenities and inherent adaptability to new working styles. “News of two new high-spec Green-Star-rated office developments worth more than $600 million planned for Auckland's Wynyard Quarter by leading developers Precinct Properties and Mansons TCLM, to create spaces for more than a thousand office workers, is just one example,” Budd says. Claiming that in many instances and, arguably, for too long, workplaces were robotically going through the motions, subscribing to the notion of “provide a desk and a chair and they will come”, office space is much more than just an item on the balance sheet. With employees having extended time working away from the office during the pandemic, many relished not having to commute and felt safer staying within their household bubbles. However, there comes the point when people want to start maintaining a sense of normality again, and this is where human interaction comes into play. “Although some workers may be questioning the value of the centralised office, the onus is on business owners to provide high-performance workplaces that factor in flexibility, hybrid working models and the wellbeing of staff.

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“Lockdown-fatigued personnel are hunting for human connection, and business owners need to ensure that the physical workplace they offer is in-step with today’s corporate working landscape, making it worthwhile for workers to return to the office,” Budd says.

Flexible working in the real estate space Whilst the real estate sector itself was an early adopter of the flexible, more fluid and mobile workplace model, the corporate real estate office will continue to have its place in the reimagined post-COVID world. “For decades, real estate agents have drawn-up sale and purchase contracts on the bonnets of cars, in cafes and away from the office,” Budd points out. “That flexibility and the hybrid model of working between home, neutral ground and the real estate office will continue — but the office is perhaps even more important now viewed through a pandemic lens.” The fit-for-purpose physical office with its business infrastructure, the unstructured water cooler conversations and stairwell interactions with colleagues, and the ability to foster team culture, will remain critical for the majority of businesses — including real estate agencies. Budd says workers are increasingly looking to align themselves with companies that place a high value on the office environment they’re providing. It’s fair to say that some occupiers now find themselves in a workspace that doesn’t echo the new ways of working, nor the revised expectations of their teams. “With all the best intentions, many corporates committed to office space in

COMMERCIAL & INDUSTRIAL SECTOR

the previous cycle that served their business model and company aspirations at that time.

50% of space, as new work practices are embedded,” says Budd.

talent, and crucial to the retention of a productive, engaged team,” he says.

“But we didn’t know about a pandemic then, and the past two years have intensified change in the workplace — beyond what could reasonably have been expected under ‘normal’ conditions.

Desk space will be jettisoned to make way for collaborative space, quiet working zones and downtime areas — adaptive spaces that are technologically enabled and able to flex and morph to changing workflows, evolving business demands and diverse staff needs.

“In parallel with consolidating quality office space in a good building are the additional advantages of being in areas with high levels of amenity, and with connection to public transport routes and main arterials.”

“Quality over quantity of workspace is now a common mantra, and it’s the way that a given space works for a business that really counts,” adds Budd.

A traditional working space no more Traditionally the three main components of an office were front-of-house/client-facing reception area, the fixed desk/workstation zone and potentially a meeting room, and staff amenities like a kitchen. We are now seeing a huge shift in the ratios of these three components. “Historically, work stations dominated the net lettable area of an office tenancy, typically taking up around 70% to 80% of the available space. “Moving forward, we would expect to see this drop down to around 40% to

Budd says Bayleys’ office leasing and strategic consultancy teams have been actively working with occupier clients to figure out what the workplace of 2022 and onward will look and feel like. “The physical environment will be crucial in incentivising employees to return to the office, it will be pivotal for recruiting new

Budd says business owners that front their team and say, “we have an office that is safe, suits your way of working, has end-of-trip facilities and a café on-site”, will have a definite head-start in drawing workers back to base. “Landlords are getting on board with this narrative, too, reassured that tenants are not necessarily wanting less space — they just want to use it differently.”

QUALITY OVER QUANTITY OF WORKSPACE IS NOW A COMMON MANTRA, AND IT’S THE WAY THAT A GIVEN SPACE WORKS FOR A BUSINESS THAT REALLY COUNTS. AUTUMN 2022

SECTOR RESIDENTIAL PROPERTY MANAGEMENT

Ever-increasing value of privacy Jo Rae, Head of Property Management, REINZ

In November 2021, the Office of the Privacy Commissioner released information relating to their compliance strategy for the Rental Sector so tenants can be confident their personal information is being collected, protected, used, disclosed, and disposed of appropriately across the residential tenancy market.

It doesn’t matter whether you’re an individual renting out a single property or a property manager in a company that looks after hundreds of properties — you must collect and handle personal information responsibly and in accordance with the Privacy Act. With current rental housing shortages, there is a feeling that property managers hold the balance of power. Some tenants believe they could be disadvantaged if they don’t provide as much information as the property manager asks for — even if they don’t feel comfortable doing so. Property managers too, are under increasing pressure from tenants who are tired and stressed over losing out on properties.

The risks of handling personal information Time has caught up with us. Historical paper-based systems that are insufficiently stored provide an unsettling opportunity for fraudsters to steal another person’s identity. The personal information collected on a standard tenancy application is enough for someone to open a bank account, get a credit card, or take out a loan. Jackie Adams, Compliance and Enforcement Manager at the Office of Privacy Commissioner, says it is still common for some landlords and property managers to throw older or unsuccessful tenancy applications into the general rubbish bin. Not a thought is given to where they may end up or in whose hands. Jackie states that the request of information, such as the name and details of your vet or who your car finance is with, is irrelevant

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to the tenancy application process, and tenants are not required to provide this level of personal information.

Making systems secure Disconcertingly, the dark web is yet another platform where someone’s identity can be sold for as little as $30 to $100. It’s a lucrative business, which has seen a 300% increase in online fraud and cyber security over the past few years. Unfortunately, online fraud and/or identity theft are problems many of us will experience at a point in our lives. Although paperwork is high-risk, so is the security of your software systems. Passwords with only seven characters can be hacked in only a second — complex passwords are crucial. Property managers must consider the amount of personal information they collect. The more they collect, the higher the risk and the more responsibility they have for keeping it secure. Having an open rental home and collecting 30 rental applications from 30 potential tenants at one time is not justified considering only one group or person from those applicants will be chosen. Narrowing down your applications to a preferred applicant status of two or three tenants is a much safer system. It also means you are not undertaking unnecessary credit checks on multiple potential tenants who may not be selected. Ask yourself: would you be happy giving your personal identifiable data to your business? Is your data secure, and would you feel you had control over it?

SECTOR

THE PERSONAL INFORMATION COLLECTED ON A STANDARD TENANCY APPLICATION IS ENOUGH FOR SOMEONE TO OPEN A BANK ACCOUNT, GET A CREDIT CARD, OR TAKE OUT A LOAN.

AUTUMN 2022

SECTOR RESIDENTIAL PROPERTY MANAGEMENT

2021 in RPM — a year of Cs Jo Rae, Head of Property Management, REINZ

Head of Property Management at REINZ, Jo Rae, connected with key players in the Residential Property Management sector across the regions to learn what happened in their world in 2021 — covering COVID-19, ways of adapting work, weekly rental records and more.

Our portfolio of 780 properties has remained stable since COVID-19 changed our lives in 2020. We have not been immune to losing managements as owners repatriate from overseas or have decided to sell after the rise in house prices. We have worked hard to replace these properties by being experts in our field. With eight offices around our mountain, we have offered expertise and a hands-on property manager in every town — and that local knowledge has been invaluable when seeking out new business. Pam Hight, Rental Division Manager, McDonald Real Estate Ltd , Taranaki

Taranaki holds the fort in RPM Whilst Auckland has grappled with the complexities of operating in an extended lockdown, Taranaki has had the good fortune to lead a comparatively normal life — with some restrictions. With New Plymouth named the most liveable city for a population between 75,000 and 150,000, and the city with the most sunshine hours recorded in New Zealand, there has been something to celebrate amidst the problems COVID-19 has brought to our region. For property management, the last year has been the year of Cs — some good and some bad. COVID-19, compliance, change, calm and common sense. The last two Cs have been the most important to our team at McDonald Real Estate. To manage the rest of the Cs, we have kept reminding ourselves problems will be resolved with a calm manner and the use of common sense.

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Looking ahead into 2022 Our biggest challenge for 2022 is the shortage of rental housing in our region. With working from home becoming the new normal, we are seeing young people move away from the main cities to our region for an economic and lifestyle change, which has put pressure on available rental housing. Demand is outweighing supply at all levels of housing, resulting in some disheartening stories. This puts a lot of pressure on our property managers, who are not immune to the desperation of potential tenants and the situation they find themselves in. I am proud of our McDonald Real Estate team, who show a great willingness to learn and be there for each other. We have developed a great culture, and I believe that is key to having a successful rental division. Here’s to a 2022 of Ss — systems, structure, stability, and most of all, success for us all.

RESIDENTIAL PROPERTY MANAGEMENT SECTOR

in the Wellington region decrease by 6%, and supply saw a downwards trend of 2%.

Stock level struggles in Hawke’s Bay Young couples, families and elderly people make up the growing rental demographic in Hawke’s Bay. But like the cities, supply outweighs demand.

Christian Casbolt, CEO, Oxygen Property Management

Wellington — the rental record-breaker Wellington had a strong start to 2021, with the median weekly rent hitting a record-breaking $615 in January, becoming the first region in the country to do so. With the level of house price increases in Wellington, we saw many first home buyers live in their rental properties for longer whilst they save for a house deposit. For the first time, Hutt Valley overtook Wellington city to become the most expensive area to live in the region. Wellington tenants started to look outside the city fringe to find more affordable living and more room for the increasingly necessary work from home set up — many opting for a longer commute in exchange for cheaper rent. When the nationwide COVID-19 lockdown hit in August, the rental market saw demand

While warmer, safer and drier homes are a win-win for everyone, making the necessary changes to comply with new requirements is costly for many landlords. As a result, an increasing number are selling up, taking much-needed stock off the market. This low level of rental stock has forced some people into emergency housing in Hawke’s Bay.

Keep calm and carry on Looking back on 2021, I concur that this was indeed a ‘year of Cs’ for us at Oxygen. Fortunately, we had a relatively stable year across the board and were able to transition well into lockdown. My observation is that the challenges and learnings of 2020 increased resilience in the profession in general. Our thinking on flexible work practices pushed forward a major revamp of our IT platform to be fully cloud-based and geared towards remote working.

FOR PROPERTY MANAGEMENT, THE LAST YEAR HAS BEEN THE YEAR OF CS — SOME GOOD AND SOME BAD. COVID-19, COMPLIANCE, CHANGE, CALM AND COMMON SENSE.

2022 will undoubtedly see further challenges compared to the pre-COVID world, but the property management profession has shown immense resilience and adaptability. It’s important for us to be prepared to be flexible and remain focused on the key deliverables. AUTUMN 2022

EDUCATION

2022 verifiable training The two mandatory verifiable topics for 2022 are:  Know the property (2h)  Balancing fiduciary obligations (2h) In-person verifiable training We're transforming our face-to-face verifiable training into Destination Events. REINZ verifiable training is hitting the road, and we'll be visiting some of New Zealand's most popular towns and cities. Join us for verifiable training, combined with a REINZ industry update (0.5 non-verifiable hours) and ample networking opportunities. In 2022, 13 destination events are scheduled, all held on Wednesdays and Thursdays. Over two days, you'll receive 10 hours of verifiable training (five hours per day), including morning tea on both days and drinks, nibbles and networking on Wednesday night (in COVID-19 traffic light settings 'ORANGE' and 'GREEN' only). Please see the 2022 schedule below:

DATE

LOCATION

VENUE

16 & 17 March 30 & 31 March 6 & 7 April 29 & 30 June 29 & 30 June 6 & 7 July 3 & 4 August 17 & 18 August 24 & 25 August 31 August & 1 September 7 & 8 September 28 & 29 September 21 & 22 September

Queenstown Auckland 1 Rotorua Christchurch Hamilton Nelson Paihia Taupo Palmerston North Dunedin Thames Auckland 2 Tauranga

Sudima Hotel Events on Khyber Holiday Inn Richmond Working Mens Club Workingmen’s Club Trailways Hotel Scenic Hotel Paihia Millennium Hotel Copthorne Hotel Dunedin Centre The Thames on Kirkwood Events on Khyber Hotel Armitage & Conference Centre

New concept – live online training Throughout 2020 and 2021, we had to adapt and find new ways of delivering meaningful and lasting learning experiences. In 2021, we trialled delivering verifiable training live online via Zoom and received overwhelmingly positive feedback. Now we're making live online training a permanent fixture on our verifiable training schedule. Sessions are run in smaller groups to enable interaction with the trainer, and the 10 hours are split into four sessions. We’re taking monthly intakes, please find the full schedule below. More sessions will be added based on demand.

March

April

May

June

July

August

Fri, 11 Mar

Wed, 6 Apr

Fri, 13 May

Fri, 10 Jun

Wed, 6 Jul

Wed, 10 Aug Wed, 7 Sep

Tue, 15 Mar

Thu, 7 Apr

Tue, 17 May Tue, 14 Jun

Thu, 7 Jul

Thu, 11 Aug

Fri, 25 Mar

Wed, 13 Apr Fri 27 May

Tue, 29 Mar Thu, 14 Apr

Tue, 21 Jun

Thu, 15 Sep

November

December

Tue, 18 Oct

Fri, 11 Nov

Tue, 6 Dec

Fri, 21 Oct

Tue, 15 Nov

Fri, 9 Dec

Wed, 27 Jul Thu, 18 Aug Thu, 22 Sep Tue, 25 Oct Fri, 25 Nov

Tue, 31 May Tue, 28 Jun Thu, 28 Jul

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September October

Thu, 25 Aug Wed, 28 Sep Fri, 28 Oct

Tue, 13 Dec

Tue, 29 Nov Fri, 16 Dec

EDUCATION Self-paced online In addition to the two mandatory topics for 2022, we’ve developed 12 elective modules that can be completed online — wherever you are and at your own pace. All training modules are now available. The topics can be purchased individually or in ten-hour packages. As a first, we have created two sector-specific packages — one for Commercial & Industrial and one for Business Brokers. The self-paced online training can be found on reinzeducation.co.nz.

Our 2022 verifiable trainers Yvonne Box (AREINZ) The Real Estate Coach Ltd

Graham Crews REINZ Life Member

David Palfreyman, Real Estate Trainer, Consultant & Auctioneer

There are three things that drive Yvonne’s world — real estate, education, and positive psychology.

As part of his role as a real estate business consultant, Graham offers ‘cutting edge’ compliance training to agencies and licensees throughout New Zealand. He co-authored writing of the Verifiable Component of the Continuing Education programme from 2012-2018 and assists as an Expert Witness before the Real Estate Agents Disciplinary Tribunal and the High Court. Graham was previously Senior Lecturer in Real Estate with Massey University, and is a Licensed Agent and Fellow/Life Member of the Real Estate Institute.

David started selling real estate in 2005 and quickly achieved recognition in the top 10% of industry performers. As a trainer, coach and auctioneer, he has worked with some of New Zealand’s best salespeople and loves helping people achieve their goals.

Graham delivers face-to-face training.

David delivers live online training.

Originally working in human resources, marketing and adult education, Yvonne joined the real estate profession in the 1990s, working in residential and lifestyle sales. After completing her diploma in real estate, she became an academic — tutoring, assessing, and writing course materials. Now, Yvonne’s focus is entirely on facilitating real estate training and positive psychology coaching — she delivers both face-to-face and live online training.

Always check what’s below

He brings a dynamic blend of technical expertise and an engaging communication style to the virtual training room. We’re excited to bring David to you as a facilitator of REINZ Verifiable Education in 2022.

FOR

SALE

OPEN HOUSE

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AUTUMN 2022

EDUCATION

New online course — ‘Marketing with Purpose’ NOW LIVE ON THE EDUCATION PORTAL

The world is changing, and the essential nature of what a business is and how it should operate needs to evolve to keep pace. Whether you are in sales, broking, or property management, own your business, lead a team, or you are new to the industry — you have the potential to become a vehicle for change. And not only because it is the right thing to do, but because your future success and the profession's success will depend on it. Our new online course ‘Marketing with Purpose’ has been designed to educate and inspire — so you can put your best foot forward in business and create positive and substantial change. This is essential for the real estate profession moving forward and is also fast becoming expected by consumers and employees. The three-part online course will help you understand marketing on a deeper level, and where we are at today. It will also focus on why it is important to bring purpose to your brand, and the positive impact you can create.

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We will explore the following topics:  Marketing for today (and tomorrow)  Your brand, your purpose  Marketing and communications. If you are interested in enrolling your team, contact us at education@reinz.co.nz. Please note that this course is fully online. You will be awarded six non-verifiable hours upon completion. Sponsored by ABC Photosigns.

EDUCATION

Prospecting for future business

REINZ VIRTUAL EVENT WITH LEE WOODWARD AND MORE

Listing presentations and conversations is the lifeblood of what we do — so it's imperative to keep changing and updating to reflect the industry's trends.

REINZ is teaming up with Australian keynote speaker Lee Woodward, real estate trainer and founder of the acclaimed Hot Topics audio series, to deliver a training event that promises to delve into leading strategies for connecting with people and converting your prospects into listings. Lee’s presentation will focus on prospecting and winning business and will share a ten-point plan for building your prospecting programme. To maximise learning, Lee will host two follow up sessions for attendees: Psychology of selling and Closing the sale.

The main, half-day event will take place Wednesday, 15 June from 11.15am to 3.00pm. Follow up sessions will be held via Zoom Wednesday, 22 June (10.00am to 10.45am) and Wednesday, 29 June (10.00am to 10.45am). This is the perfect opportunity to get your team together and upskill! Tickets are on sale 17 March. If you are interested in enrolling your team, contact us at education@reinz.co.nz. Sponsored by Skills and realestate.co.nz.

Lee will be joined by a second keynote speaker and a kiwi success panel, which will discuss processes, marketing and growing your business. A virtual meeting of minds, the event will be hosted in an interactive, virtual space with opportunity to ask questions and engage with speakers and other attendees.

Exclusive number plate up for grabs An established rural realtor has owned these unique number plates — ‘LAND4U’ — for more than 25 years. Now, looking to retire, he is passing on his trusty number plates to another agent who wants to be outstanding in their field. If you would like to be the next owner of these number plates email kimcar@xtra.co.nz to submit your purchase price. Deadline for all offers is 4pm Thursday 31 March 2022.

The plates are in very good condition and are great promotion for a real estate agent selling land.

AUTUMN 2022

EVENTS

2022 REINZ events — save the date REINZ Auctioneering Championships Join us for another exciting Auctioneering Championships event as school competitors, Rising Stars and Senior Auctioneers compete for New Zealand’s Auctioneering Championships title. The event is to be held on Sunday 19 June to Tuesday 21 June at Auckland Central’s Events on Khyber and is free to attend. Registration is only required if you wish to compete.

Entries will open Friday 1 April.

2022 REINZ Awards for Excellence

The annual REINZ Awards for Excellence is a signature gala dinner for real estate professionals to come together from around the country and celebrate success across the profession. This year, the event will take place at 5:30pm on Tuesday 6 September at the Cordis Hotel in Auckland.

Entries will open on Monday 2 May and tickets will be available soon.

To find out more about either of these events, please contact events@reinz.co.nz. 40

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Contact us for your Free Trial - Get PropertySmarts today! Call us toll free on 0800 473 469 or email membership@reinz.co.nz

PropertySmarts is exclusive to members of REINZ.

TECHNOLOGY

PropTech — drivers, trends and engagement Whether it’s by automating, personalising, or streamlining processes, technology can remove friction and workload from real estate professionals when it comes to keeping clients and customers informed and delivering a customer-centric experience. While the skills of the profession in building meaningful connections, market knowledge and problem-solving will remain critical, we look at how property technology (PropTech) is changing the rules of engagement.

Property owner analytics, building efficiency data, marketing and management — PropTech is used across the real estate spectrum. We’re starting to see a dynamic digital ecosystem begin to foster new and more efficient consumption models at all stages of the property cycle — from pre-sales, sales, financing, construction and settlement to management.

A digital gear change So, what’s driving the quick shift to digital technologies in the property sector? Accelerated by the pandemic, we’ve seen a shift in consumer expectations — and technology is bridging that gap across all industry segments. As Chris Simmons, Chief Executive Officer at Listing Logic, an automated digital advertising platform, observes, over the last 20 years the world has gone digital, adding that “the real estate market is now catching up on what has been a global shift”. “As the millennial generation comes through as the dominant purchaser of properties, these digital natives expect to find all information online and available when they want it,” Simmons adds. Early digital adopters such as financial services, health services, hospitality, food delivery, retail and travel have all experienced digital disruption. All you need to do is look at FinTechs (financial technology) such as Revolut, which have upended banking services so they are mobile, connected, and answer the needs of a digital-first customer base.

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Howard John, New Zealand sales manager at DIAKRIT — a leading provider of digital visualisation solutions — echoes this sentiment. When it comes to property marketing and transactions, he says it’s down to buyer and vendor expectations — a trend driven through innovations in other industries. “We have all come to expect information at our fingertips, at any time of day, wherever we are in the world. Major industry players like Uber, Netflix and Spotify have led this evolution and today a customer's experience isn't industry-specific. Rather, real estate is competing with the best experiences a buyer or vendor has received across any industry, and this is driven by digital technologies enabling a greater customer experience,” he says.

An opportunity for real estate excellence As innovations already seen in other industries continue to root in the real estate sector, we can expect to see PropTech further streamline operations and reduce cost, by enhancing transparency, boosting security, and automating repetitive processes. The early stages of this were the adoption of digital record keeping through customer relationship management systems (CRMs), which enable agencies to track properties and manage their customers, Simmons notes. Knight Hou, CEO and co-founder of property market data provider Relab, looks to the rapidly burgeoning areas of FinTech, and more recently,

TECHNOLOGY

blockchain technology, which paves the way for increased efficiencies, reduced friction, minimalization of lead times and increased profits. “Decentralised systems encourage collaboration and seamless transactions. We are already seeing this emerge in the digitisation process,” he adds. The introduction of blockchain technology to real estate has the potential to really disrupt how business is done. By leveraging distributed ledger technology (DLT), blockchain can provide greater transparency and increase trust — which is the currency of real estate. But it also has the potential to expedite contract processes, save time and reduce cost.

In the current market, where people are increasingly looking for alternative options to get on the property ladder, blockchain allows what is termed ‘tokenisation’. This enables multiple people to purchase tokens of a particular property and co-own the building — introducing a clean way of partial-ownership of that asset.

Digital promotion or engagement represents a major opportunity for PropTech. John believes that it’s the space that will continue to see the most growth.

“If agents can master high levels of engagement on their listing page with digital tools like virtual tours, furnishing and renovation tools, they can then use that buyer information to retarget and grow their Accelerating engagement from database. This will allow for more access pre-sales to operations to more buyers and a bigger pipeline for We’ve already seen the proliferation of property future listings. Think along the lines of how marketplaces — such as realestate.co.nz Facebook and other social media apps feed — that connect buyers and sellers, tenants us content based on our preferences and and landlords, and other real estate history,” John says. stakeholders. This is now a well-embedded part of the property process that is closely But how one leverages this effectively is aligned with digital marketing tactics. down to data. AUTUMN 2022

TECHNOLOGY “Aggregating property information into digital promotions and building well-qualified buyer pools using artificial intelligence is not far away,” Simmons says. What this means in practice is more targeted and thus effective prospecting and marketing campaigns, so you reach your potential vendors and buyers where they are in a way that resonates. The data element doesn’t just pertain to prospecting and marketing, there is much room for growth in the areas of data analytics and integration. Hou recognises that the real estate profession is using technology at an advanced level on the demand-side, but he sees a massive opportunity for the effective use of data to improve operational efficiencies. “The PropTech lifecycle encompasses developing, building, renting, buying, managing and selling,” he says, and technology can support more effective practices throughout. “For instance, removing the friction of data flow between each step of the lifecycle would help reduce costs/time wasted, improve efficiencies and optimise customer outcomes,” Hou advises.

2022 — a year of digital transformation The pace of digital transformation in the real estate sector shows no signs of slowing. The number of tech startups entering the PropTech arena and investment levels in this space are tell-tale signs of innovations to come. But what might we expect on the PropTech scene over 2022? Well, the future looks truly connected, with engagement as the integral focus. On the customer-facing side, we will continue to see the use of digital tools to support engagement between vendor-agent-buyer and buyer-property. We’ve already seen how readily people have adapted to virtual technologies during the pandemic, with buyers purchasing sight unseen. “The increase in the use of virtual tours and property videos to act as ‘pre-inspections’ before coming to physically view the property will move from a COVID-19 requirement to the norm,” John says. As consumers become ever-more familiar with them and the technology evolves, we can expect confidence in — and acceptance of — virtual methods of conducting business to grow. “The way the world is moving towards AI, Metaverse and other digital advancements, those who do not keep up with consumer demand will

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THE WAY THE WORLD IS MOVING TOWARDS AI, METAVERSE AND OTHER DIGITAL ADVANCEMENTS, THOSE WHO DO NOT KEEP UP WITH CONSUMER DEMAND WILL FALL BEHIND AND THEIR BUSINESS WILL SUFFER. fall behind and their business will suffer,” he cautions. Simmons envisions direct digital engagement at all stages of the property lifecycle. “Automated advertising solutions to serve dynamic, hyper targeted audiences with real-time statistics.” But he also sees what has become known as ‘big data’ infiltrate the space further. “Big data will play an important part in real estate in the future allowing the software to recommend more intelligent and personal searches,” he adds. Hou ventures a step further — heralding the advent of a more connected data pool, through which the real estate sector can achieve a greater level of transparency. “Similar to “Open banking” in FinTech, the liberation of property related data is set to be an emerging trend. We’re also seeing proactivity from central and local authorities in terms of digitalisation. Tangible benefits include increased collaboration between subcontractors, improved transparency to help with decision-making, time and efficiency gains and increased participation of end users (home buyers) in the planning, design, and building process,” he says. Already, we have seen a radical transformation in how we sell, buy, and rent properties through the adoption of digital technologies. As the market grows, we will continue to see the introduction of digital tools that enable the real estate profession to connect with prospects and streamline some of the more tedious processes. PropTech won’t replace this thriving profession, but it does have the ability to enhance and support it.

TECHNOLOGY

Member relationship management — the good oil

Miles Fordyce, Chief Digital and Innovation Officer, REINZ

Any good business lives and breathes success on its ability to connect, interact and engage with its customers — this is much the same for us here at REINZ, except our members are our customers, and we are here to support you as best we can.

With more than 16,000 members nationwide, keeping track of membership and interactions is critical and, at times, challenging. Each month, we have hundreds of calls, emails and interactions with the real estate profession, and thousands of digital interactions on our website. Ensuring we can provide all members with the best service is as important to us as it is to you.

Members at the forefront Customer relationship management (CRM) or membership management enables us to service numerous agency head offices, regional offices, individual agencies and agents. It also helps us provide targeted membership services such as advocacy, advisory, education, statistics and events. We aim to ensure that you get even more from these services, and we are currently implementing a programme of work to improve support systems and services in 2022. As technology continues to evolve across all areas of real estate, we see an ever-increasing need to provide members

with simple, easy and effective channels to communicate and interact with REINZ. Members expect a deeper level of connectedness, personalised experience, and seamless integration from system to system — and we want to deliver on that.

Watch this space To get the ball rolling, the glue holding this together — our CRM system — needs to be strong and secure yet malleable enough to accommodate changes in services, content and interactions as much as possible. Accordingly, we’re renewing the REINZ CRM system, modernising how we process and hold member and nonmember (customer) data. More importantly, we’re reviewing how we can deliver a more connected and personalised experience for members, so you can connect, find and engage with us at REINZ for the services and information you need to run your businesses. By bringing all this information together under a single view, member support has never looked so promising. AUTUMN 2022

INTEREST

Auctions paving the way in the market

John Abbott, Real Estate Sales Coach and Auctioneer

The past twelve months have seen significantly more properties being marketed for sale by auction. This trend has occurred right across the country, including in areas where agents have historically been reluctant to embrace this method of sale.

So why are we seeing an uplift in the number of properties sold by auction? The number one driver is, of course, the lack of supply and increased buyer demand. There are regular reports of auctions attracting more than ten bidders and clearance rates between 80% to 90%. COVID-19 restrictions also contribute to the proliferation of auctions as we shifted from in-person to online auctions, which have been remarkably successful. Anecdotally, some agencies are considering moving all future auctions online — even after restrictions are fully lifted, noting that many buyers are more relaxed when bidding from their own home, and the dynamics are different when in a user-friendly environment. Online auctions have quickly gained popularity and have become commonplace amongst buyers. People don’t need to wait around for hours until their auction commences; rather parties can bid from the comfort of their homes. The interaction between the auctioneer and bidders is relaxed, salespeople can assist the bidders if they wish, and it is easy for the auctioneer to consult the owners mid-auction if required.

Can technology replace the auctioneer? Online auction sites have already taken over other ways of selling — Trade Me

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as the hub of selling household items, or Facebook Marketplace, are just some examples. These platforms have become the norm when selling such items online, and it’s easy to imagine that this could soon be much the same with properties. However, I’m not convinced that will happen with higher-priced offerings such as fine art, bloodstock, and real estate, just yet. There is too much emotion tied up in these highly valued items. This is where an auctioneer can bring a wide range of skills, extending far beyond simply adding numbers together. They can manage and read human interactions and the expectations of parties involved, which are crucial skills that enable auctioneers to achieve greater results than what technology, at this point, can accomplish.

Advantages of auctions in the current market A significant advantage of an auction in a market where prices are rapidly increasing is that there is little risk of underselling. Potential purchasers suffer from a fear of missing out and will often exceed their predetermined limit to avoid having to pay more for the next property. When the market changes, as it may well be doing in 2022, the preferred option for vendors should be to sell by auction. In changing markets where the number of bidders at auctions reduces,

INTEREST

some salespeople recommend marketing properties by other methods of sale. However, this may not be the best advice. Auctions are suitable for both sellers’ or buyers’ markets, but for different reasons. In a sellers’ market, auctions achieve premium results in competitive environments. In a buyers’ market, particularly where prices are easing, time becomes crucial and selling earlier rather than later benefits the client. An auction does two things in this type of market; it places a time limit on when buyers must make a decision and act on it. Other methods of sale can involve similar elements; however, the time limit needs to be combined with open competition between buyer and buyer, not between buyer and seller. Apart from auctions, every other method of sale creates a mindset of the buyer competing against the owner. An auction is arguably the only true form of open competition sustained by open market transparency, as buyers pay more to outbid other buyers rather than to satisfy the owner.

when desperate to sell. I recall speaking to vendors who would tell me that they were not under pressure to sell, so did not need to auction. A blanket view across New Zealand was that an auction was typically a last resort method of sale, and back then, was largely associated with mortgagee sales. With persistence, hard work, and skill, a dedicated group of auctioneers who worked with agents and vendors turned this perception of auctions around in the late 1990s and 2000s. Running parallel to this change was the expansion and improvement of marketing to promote properties effectively. With encouragement, sellers began to see the benefits of marketing their property properly. From virtually no client investment in the 1990s, it is now assumed by nearly every seller that they need to invest in marketing to ensure the best result.

A shift to a preferred method of sale

While it took time and education, auctions now account for a significant percentage of all real estate sales across the country and vendors investing in marketing has become regular practice — according to REINZ data, in December 2021, 30.5% of sales were by auction.

As of recent times, the broader public has begun to accept auctions as mainstream and often the preferred method of sale. In the late 1990s, auctions were few and far between — viewed by the public and the majority of the profession as a method used

What’s more, this shift in mindset around the potential of auctions proves that perceptions can change over time and that the market can adapt to new ways of doing things — even if the pandemic is the catalyst for this!

AN AUCTION IS ARGUABLY THE ONLY TRUE FORM OF OPEN COMPETITION SUSTAINED BY OPEN MARKET TRANSPARENCY, AS BUYERS PAY MORE TO OUTBID OTHER BUYERS RATHER THAN TO SATISFY THE OWNER.

AUTUMN 2022

INTEREST

Connecting through understanding

Lee Woodward, Head of Digital Education, Realtair Academy

There’s an art to prospecting. And it’s not just about finding new leads; it’s about connecting and building trust with people to ensure a strong network and a steady stream of client listings into the future. Lee Woodward, real estate trainer and author, takes a fresh perspective on a familiar part of the sales process.

Supermarket giant Aldi is thriving because they understand their target market so well. They know how to connect with people in such a way that they queue up at the door on Specialbuys days. What’s Aldi’s point of difference when it comes to specials? It’s that you never know what you’re going to get (people love a surprise). Similarly, Apple is killing it because they too know their customers exceptionally well. To truly connect with your tribe, you also need to become exceptional at understanding your target market and learning how they tick. One of the most incredible things about the real estate industry is that everybody is moving at some point. This is true no matter how the property market is fairing. So why wouldn’t prospecting be on everyone’s daily radar? It’s the one activity that will keep the pipeline flowing in your business.

Putting prospecting on the menu “I make it a point to regularly ask agents what prospecting they are currently doing or are planning to do in the future, and it astounds me how often I am faced with a vacant look in response,” says Lee. He believes there are two key reasons for failing to prospect on a regular basis — fear of rejection and the fact that many have never monitored what works and what doesn’t.

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He notes, “If agents knew what worked for them, it would be on their prospecting menu. Imagine going to a restaurant and discovering there’s no menu. When the waitress asks for your order, how would you know what to select if you have no idea what’s on offer? Prospecting is no different. You need a menu of proven methods that work, from which you can make a selection." Lee’s latest book, How to Prospect for Future Business in Real Estate, provides readers with an extensive prospecting menu because it recognises that not all methods will suit all people. Drawing on 30-plus years in the industry and collaboration with some of the best in the business, Lee provides a clear, practical understanding of the techniques, the approach, the words and the thinking that will help you find and connect with people who are thinking of moving. Most importantly, he outlines how to develop genuine longterm relationships based on trust.

The trust factor “In order to build trust, you have to understand that real estate is about service first and foremost. Nail that part, and the sales and financial rewards will follow. Whether you’re new to the industry or a seasoned professional who has lost momentum and needs to get back on track. The old way of door-knocking and cold

INTEREST calling is not what prospecting is about at all,” Lee says. “Even the word ‘prospecting’ has the wrong connotations. It conjures up thoughts of nervous exchanges of unwanted information with total strangers who don’t want to hear from you, let alone get to know you. That’s why I included the words ‘future business’ in the title of this book. “Future business is the truth behind what we do. Every day when you’re interacting and chatting with people, it’s about generating future business, and it never ends. The longer you are around the better and easier it will become, because people will observe you helping other people. They will get to know you as someone they can have a chat with, engage with, and do business with.” Lee is teaming up with REINZ to deliver a virtual training event that delves into leading strategies for connecting with people and converting your prospects into listings. Lee will share a ten-point plan for building your prospecting programme and, for all attendees, provide a copy of the e-book, How to Prospect For Future Business.

Prospecting for future business REINZ virtual event with Lee Woodward and more A virtual meeting of minds, Prospecting for future business will explore prospecting in an ever-changing landscape where connections and trust are key. Lee will be joined by a second keynote speaker and a kiwi success panel, which will discuss processes, marketing and growing your business. The main, half-day virtual event takes place Wednesday, 15 June from 11.15am to 3.00pm. To maximise learning, Lee will host two follow up sessions via Zoom on Wednesday, 22 June (10.00am to 10.45am) and Wednesday, 29 June (10.00am to 10.45am). Tickets are on sale 17 March. If you are interested in enrolling your team, contact us at education@reinz.co.nz.

EVERY DAY WHEN YOU’RE INTERACTING AND CHATTING WITH PEOPLE, IT’S ABOUT GENERATING FUTURE BUSINESS, AND IT NEVER ENDS.

AUTUMN 2022

INTEREST

Bidding farewell to two influential REINZ Regional Directors At REINZ’s 2021 Annual General Meeting held virtually in November 2021, we said farewell to two of our Regional Directors: Wendy Alexander and Mark Coffey. Wendy Alexander (FREINZ) stepped down as Regional Director (Region 1), having completed the maximum number of years as a Director on the REINZ Board. Wendy was recognised as a Life Member at the AGM. Mark Coffey’s (AREINZ) term as Regional Director (Region 3) also came to a close.

Wendy Alexander (FRIENZ/Life Member) Wendy is well-known and respected across the real estate profession. She has been on the REINZ Board as Regional Director for eight years, has been actively involved in the profession for nearly 45 years, and is a staunch supporter of the Institute and a Fellow of REINZ since 2011. Wendy was also the Chairperson of the Remuneration and Human Resource Committee for REINZ and oversaw the Residential Property Management Sector Group. Her professional knowledge stems from executive experience in real estate, including 21 years at Barfoot & Thompson where she was Chief Executive for nearly 11 years. In 2018, she retired from this role to create time to pursue other interests and became a consultant. Later, Wendy took on the role of Property Brokers’ regional manager in Waikato. Anyone who knows or has worked with Wendy understands her passion for helping people. Wendy has mentioned that she loved working at Barfoot & Thompson and Property Brokers because they are family-owned businesses, and they cared for people — something she holds close to her heart. After her long tenure at REINZ, Wendy will leave a lasting legacy of service. As many of you may know, she has served twice as interim Chief Executive at REINZ, most recently in March 2021 to cover the period between Bindi Norwell’s departure and Jen Baird assuming the role of Chief Executive in July 2021.

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Wendy loves to see people operate outside of their comfort zone and succeed as a result. She has helped many within REINZ and in the profession do just this. By awarding Wendy Life Membership, REINZ confirms that we — as her colleagues — admire her high standards, achievements and reputation, and are proud to recognise people of her integrity and service. The team at REINZ are forever grateful for Wendy’s valued input over her tenure and the positive impact she has had on our organisation. We wish Wendy all the very best for her future endeavours and trust she will take her wisdom, wittiness, passion, and kind spirit wherever she goes.

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Mark Coffey (AREINZ) After working in mechanical engineering for 18 years, Mark had a change of heart and completed a diploma in management and went on to pursue a Master of Business Administration Degree (MBA) via Henley Management College in 2001. Mark then attained his AREINZ in 2003. As the Owner and Managing Director of Tommy’s Real Estate in Hutt Valley, Mark has extensive experience and knowledge of the real estate profession. As well as being on the REINZ Board, Mark is currently a Chairman of the NZ Realtors Network and works closely with the wider NZ Realtors group in his role with the organisations Board since 2014. Mark’s knowledge as a business owner and Chairman was a huge asset to the Board — he added immense value, a different perspective, and was known to have a down

to earth manner which REINZ and the Board greatly appreciated. Throughout Mark’s tenure on the Board, he has advocated for his regional members and understood the differing needs of all members. Mark never failed to bring his astute understanding of the profession and the concerns and opinions of his region and the wider profession to the forefront of REINZ. Not only this, but he provided underlying support of discussions with the ADLS and valuable contribution on the ADLS/REINZ Copyright Working Group. His commitment to REINZ has made a tangible difference to how and what we deliver. We wish Mark well and sincerely thank him for his dedication and commitment to REINZ, the Board, and most importantly, our members.

AUTUMN 2022

INTEREST

First-time home seller? Make their first one a good one

Karen Jackson, Managing Director, Lifestyle Finance

Selling your own home for the first time is an exciting prospect — but for those who are unsure about the process, it can also be daunting. For some, it may be as scary as purchasing their first home. This is where you — a trusted and reputable agent — can help lead the way and ensure a positive first-time selling experience for your client.

What do they want to achieve from the sale? For many, figuring out where to start is the hardest part. It’s important that the seller understands what they’d like to achieve from their selling journey. The reality is, there are many reasons for putting a house up for sale — family circumstances or lifestyle changes are just two examples. Perhaps they need to move for work or be closer to family. Or maybe, they’d like to cash in on their property to fund a new venture or upsize in a more affordable location. Depending on their needs and goals, getting a house market-ready may require more or less time; extensive renovations or minor touch-ups; a simple marketing campaign or a more sophisticated one. Understanding the ‘why’ of the sale can help you understand how you can lend a helping hand.

What’s the current market value? A home is more than just a house. It’s an emotional asset, and it can be hard to see it objectively — let alone put a price on it. Whilst sellers can utilise free online tools to provide them with a rough estimate of their property’s value, a licensed real estate

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agent will enable a far more reliable and accurate valuation. As a property’s value is only ever what someone is willing to pay for it — many sellers will want all the tips and tricks they can get from an agent to boost their property’s appeal and get more motivated buyers through the door.

Repairing or upgrading The seller will need to assess whether their property needs extensive repair or upgrading — or whether minor fixes will be enough to achieve their selling goals. Once the seller has an idea of what they want to achieve from the renovations and has a budget in mind, you can begin to recommend projects that are likely to deliver a good return on investment. First impressions can make a big difference in real estate. From curb appeal to repainting the walls, cosmetic changes inside and out may go a long way in increasing the sale price. For more targeted renovations, kitchens and bathrooms are usually the rooms to focus on. While they’re the most expensive rooms to remodel, a well-planned renovation can add the most value. The key thing is to consider what might get the seller the best return with the help of

INTEREST a property valuer. The good news is that budget constraints don’t necessarily mean they have to settle for less.

Showing off your seller’s house in the best possible light Premium real estate marketing will help increase buyer appeal and set your seller’s home notches above the competition. As an agent, you’ll be used to supporting your listings with continuous and multi-channel promotion, prioritising channels where your target buyer spends the most time. High-quality imagery — whether photos or videos — is more important than ever for online listings. It can be the difference between buyers scrolling away and a busy open home. And let’s not forget home staging, the art (and the science) of highlighting a property’s most desirable features while minimizing its least.

A support system Having a real estate agent to guide the seller through the process and provide advice along the way is a significant support system the seller probably didn’t realise they needed until their property is up and ready and put to market. It’s a fast-moving process; your knowledge and expertise will help them understand aspects such as the pros and cons of buying and selling first, any extra costs that might be involved in selling, and what opportunities are up for grabs in the market. Selling a home for the first time can be challenging, but you can show your seller that they don’t need to go at it alone.

At Lifestyle Finance, we’re in the business of helping New Zealand sellers make the most of their property opportunities. Like to know more about our finance solutions? Visit lifestylefinance.co.nz to learn more about how we can help you. Check out our ‘Advertise Now and Pay Later’ finance tool designed for vendors looking for ways to maximise their sale. With our ‘Renovate Now, Pay Later’ finance tool, we can fund renovation needs and for 90 days you won’t have to repay any of the principal — just the time you need to spruce it up and make a quick sale. Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.

AUTUMN 2022

INTEREST

Fail to plan and plan to fail THE IMPORTANCE OF PLANNING FOR REAL ESTATE SUCCESS

Jasmine Platt, Founder, Real Estate Leaders

We’ve all heard, “fail to plan, and plan to fail.” It’s a familiar adage, but it’s true. However, in my work with real estate professionals, when it comes to business success, I regularly hear big dreams, little planning and a whole lot of hope.

Let’s face it, no one enters real estate sales or leadership expecting to fail. Yet, some salespeople get into the profession and quickly leave again like revolving doors — and at the leadership level, businesses change hands regularly. This failure, sadly, is mostly due to inadequate thinking and planning. As a real estate business coach and mentor, I have watched from afar as well-intentioned people fail — I don’t want that for you. I’ve also heard some real estate professionals question whether they need a business plan. The thing is, business success should never be hung on hope. It should be grounded in accurate thinking and built on a solid plan. Sure, you might stumble upon a win or three, but your ability to create sustainable results that match your long-term goals will be limited.

The biggest mistake I observe with planning I am regularly in conversations with salespeople and managers alike who claim to have a plan for achieving their goals. But, upon closer inspection of their goals, it becomes clear that their plan is lacking — often resulting in a lot of activity, but a lack of progress. I recently worked with a salesperson, who had historically “flown by the seat of her pants”. Instead, we got her clear on her goal (six listings in 12 weeks) and crafted a solid plan. She is about to close her

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17th listing. Whilst I also provided support and accountability, her goal setting and planning drove her to her results.

Benefits of business planning In addition to clarity and direction, a well mapped out plan will give you confidence, a sense of certainty and security, a yardstick to monitor your progress, and an ability to shore up your resources when and where needed.

What to consider Here are some important elements that are worth spending the time to think about and create your plan around:  Cost of living (this will help you set your financial goal)  Any other financial costs (e.g., retirement savings, investments, toy purchases, holidays)  Financial goals for the year (from the above figures)  The key metrics you need to hit to achieve your income target (sales, listings, appraisals, appraisal-to-listing and listing-to-sale conversion rates)  The personal brand and reputation you are seeking to grow/maintain and how you’ll do it (i.e., what tactics will you employ and when)  Your offer, your competition and what you’ll do to stand out from the rest

INTEREST  Your month-by-month marketing plan  Resources — and access to resources  Budget and planned spending  Available time and timetable  What help you’ll need to scale your business; and  A learning and development plan.

Ten tips for successful planning Here are my top recommendations for the planning process: 1. Do it over a series of short sittings Scale it down to make it manageable. 2. Getting it done is better than it being perfect The purpose is to get you thinking, not perfecting a perfect, but potentially unactioned plan. 3. Start by identifying your short and long-term goals What are you trying to accomplish? Understand your target, and more importantly, why that number? Being connected to your ‘why’, will support you to create a robust, meaningful plan. When thinking through your goals, I strongly recommend you don’t neglect your retirement goals. How far are you from retirement? How much do you need to live comfortably once you retire? How much do you need to make/save/invest to ensure you’re prepared?

capital you have and lines of credit you have access to. If you don’t have any — have a plan for how you’ll ensure you’re visible and effective against your competitors who are investing in their businesses. Run an inventory of what non-financial resources you have access to, and resources you might need such as a delivery person, or a part-time personal assistant. 7. Make sure you think about delegating or outsourcing low-dollar-value activity Too many salespeople try to do it all. But to be successful, you will need to focus on your highest-dollar value activity. Delegate or outsource the rest. To do this, allocate money to get help. 8. At the very least write a plan for marketing, client care, finance and delegated support How will you build visibility, trust and relationship in your area? How will you demonstrate your care for your vendor and buyers experience? Do the numbers stack up? What can you outsource?

9. Identify areas you need to improve — and plan learning and development time What areas do you need to improve your skills to lift your results or grow your reputation and career? Every business and salesperson — regardless of success level — should have a plan for their development. Where do you need to improve? Do you need to lift your listing or sales conversion rate? Learn to delegate and recruit effectively? 10. A business plan is only useful if it’s honest, practical and meaningful Only write it if you’re going to do it. Don’t do it because it’s a ‘good idea’. (You won’t work a plan you don’t connect with). Your planning clarifies what you’re going to do day-to-day and week-to-week to achieve goals that matter to you. Doing the thinking to work out your goals and what actions you need to take — and mapping it out in such a way that you can execute it, will save you from having to rely on hoping for the best. That preparation (plus the relaxed state you’ll get to live in as a result) is priceless.

4. Take time to work out your key metrics Expect that calculating your metrics may be confronting. This is all part of the process! If it helps, involve others. Work out your cost of living with your partner, your conversion rates with your manager, your retirement needs with a financial advisor. 5. Build in work-life balance Structure your time. Identify the hours you have available to work and when. Too many real estate professionals don’t do this and fly by the seat of their pants. This is stressful and a poor approach to business. Build your plan in a way that factors in your health, family, and other commitments. 6. Clarify your existing financial and non-financial resources — and those you might need To market yourself (or your team) and grow your business, you need to know what money you have to play with. This includes Jasmine Platt helps real estate agency leaders to lead and grow successful real estate sales teams, make more money and win more of their time (and sanity) back in the process. If you’re a business owner and need help putting a business plan together, or you want to work through business planning with your sales team, visit www.realestateleaders.co.nz — or email jasmine@realestateleaders.co.nz. AUTUMN 2022

INDUSTRY

Nadine Thomas, Head of Engagement, Insights and Education, REA

No surprises

WHY GETTING TO KNOW A PROPERTY BEFORE LISTING IS ALWAYS WORTH THE TIME AND EFFORT

Between a client’s eagerness to ‘get the property on the market’, your natural desire to progress towards sale, and general workload in a busy environment, there can be pressure to move swiftly through the appraisal and listing process. But, taking the time to be careful and thorough with your due diligence from the outset is not only an obligation (under rule 5.1 of the Code of Conduct), it can save you time and trouble in the long run by preventing avoidable issues in the first place.

Many of the complaints we receive at REA are from consumers unhappy that they have not been provided with essential or accurate information about a property by the listing licensee. Typically, these issues result from oversight rather than intention to mislead. However, it’s important to note this can still constitute unsatisfactory conduct. When listing a property, the onus is on the licensee to thoroughly research and understand what you are selling. Your client and potential buyers are relying on you to be knowledgeable about the property’s details. Getting it right at the start of the sale process by ensuring the property’s details are accurately reflected in the agency agreement is critical because of the flow-on effects that can arise if this isn’t done. Mistakes or oversights at listing time can lead to issues such as advertising being deemed misleading, or potential buyers discovering compliance issues that weren’t identified and disclosed upfront.

Don’t rely — verify Referring to your agency’s practice guidelines will help ensure you follow their recommended approach to appraising and listing a property. It’s also key to understand the stumbling blocks that can catch you out during this process, and of which you need to be aware.

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Remember that licensees are expected to be proactive in gathering and verifying the essential information about a property, and if necessary, to dig deeper when something doesn’t seem quite right. Clients are naturally a key source of information about their property. However, our research indicates that a significant proportion of clients may deliberately withhold information from licensees, or unintentionally provide inaccurate information (e.g., misremembering when renovations were carried out, which can affect compliance obligations). Our research also shows that many clients rely on the licensee as the expert to help them navigate their disclosure obligations. For this reason, key property information supplied by clients should always be verified through documentation, direct inspection, or a combination of both.

When is a bedroom not a bedroom? Just because a living space appears to be used for sleeping does not guarantee it can be marketed as a bedroom. For instance, converted garages cannot be described as bedrooms unless they have the appropriate consents and certifications, and rooms comply with the minimum requirements under the Housing Improvement Regulations 1947.

INDUSTRY

If a conversion has no Code Compliance Certificate (CCC), REA considers it misleading to advertise it as a bedroom (e.g., by including it in the number of bedrooms the property is said to have) — even if you intend to disclose the lack of a CCC to prospective buyers.

Go looking for red flags Clients often see your initial inspection of a property as being all about appraising its value. They may want to accompany you as you walk through and showcase its features. But, it’s important to use the inspection as an opportunity to help verify information you’ve been provided, and look for possible red flags that may require further investigation. Question:  Does the land area in the Record of Title seem realistic?  Does the floor plan differ from Council records?  Are there signs of alterations (such as features not matching the age of the home) that the client has not mentioned?  Do all the rooms that appear to be used for sleeping meet the legal requirements to be used as a bedroom?  Are there any signs of stigmatised materials that will need to be documented and disclosed?

Remember, thoroughness is key to meeting your professional obligations. The Real Estate Agents Disciplinary Tribunal recently found in the case Beath and REAA and Mike Pero and Beath and REAA and Kemp & Scoble [2021] NZREADT 40 that the licensees had failed to exercise skill, care, competence and diligence as they did not disclose the presence of Dux Quest piping (a stigmatised material) under a house, even though they hadn’t known it was there, stating: “…where there is reasonable access to the underfloor area of a property, reasonably competent licensees should take the opportunity of looking into (the) area, to satisfy themselves that there are no issues of concern — whether these be plumbing, piling or any indication of other issues.”

Knowledge is your best protection

LICENSEES ARE EXPECTED TO BE PROACTIVE IN GATHERING AND VERIFYING THE ESSENTIAL INFORMATION ABOUT A PROPERTY, AND IF NECESSARY, TO DIG DEEPER WHEN SOMETHING DOESN’T SEEM QUITE RIGHT.

Ultimately, under rule 5.1, your role as a licensee requires you to source pertinent information and take care when completing due diligence at listing time. Moreover, knowing the property is the foundation for you and your agency colleagues to market it appropriately on behalf of the client. The more thorough you are, the more you can anticipate and avoid (or at least mitigate) a range of potential issues later in the transaction process.

‘Know the property’ is a mandatory topic in this year’s REA Continuing Professional Development Programme. Book your training with your REA approved training provider today. AUTUMN 2022

LEGAL

REINZ hosts its 2021 Annual General Meeting (AGM) online

Melisa Beight, General Counsel, REINZ

REINZ held its AGM on Wednesday, 24 November — this year, for the first time, as a virtual event due to COVID-19 restrictions. We bid farewell to two Board Members and welcomed two new Regional Directors and three new Life Members. The AGM was well attended and ran smoothly, thanks to the high number of pre-registrations. It was wonderful to see many familiar faces.

Treena Drinnan (AREINZ)

We were pleased to announce the reappointment of Miriam Dean QC (Independent Director) and Jo-Anne Clifford (Appointed Director) for a further two-year term. The Board also re-elected Bridget Coates to continue as Chairperson for a further one-year term.

Treena has 27 years of experience in the real estate profession and is the current Chief Agency Officer at Ray White, sitting on the corporate leadership team. Treena has been involved in the REA Regulator Forum and as a subject matter expert helping shape CPD (verifiable and non-verifiable) training material annually.

Election of two new Regional Directors

Malcolm has over 30 years of experience in the profession, including commercial and industrial, residential, business brokering and auctioneering. Malcolm is a Licensee Salesperson at Ray White Kilbirnie. He is passionate about real estate training and is an REA approved verifiable training provider and a part-time contract assessor for the Real Estate Salesperson course — Level 4.

Two new Regional Directors were welcomed to the Board. Treena Drinnan (AREINZ) joins the Board as the Regional Director for Northland, Auckland, and Coromandel (Region 1), and Malcolm Morris (AREINZ) joins as the Regional Director for Hawke’s Bay, Manawatu/Whanganui, Taranaki, and Wellington (Region 3).

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Malcolm Morris (AREINZ)

LEGAL Bridget Coates, Chair of the REINZ Board, says she and the rest of the Board are delighted to welcome Treena and Malcolm, who bring their extensive knowledge of New Zealand real estate. “Already proactive contributors to the profession, they will add invaluable expertise and energy to the Board, its members, and the wider profession in the coming months and years,” Bridget comments. Farewelling two Regional Directors REINZ bid farewell to two Regional Directors as their terms came to a close at the AGM. Wendy Alexander (FREINZ) retired as Regional Director for Region 1, having completed the maximum number of consecutive terms as a Director on the REINZ Board. Mark Coffey’s (AREINZ) current term as Regional Director for Region 3 also ended. At the online event, Bridget acknowledged the outgoing Directors and their significant contributions whilst on the Board.

Celebrating achievement with three new Life Members Three new Life Members were elected at the AGM — Wendy Alexander (FRIENZ), Garry Denley (Honorary Retired), and Robert McCormack (FRIENZ). Wendy is well-known and highly respected in the profession, with over 45 years of experience and a Fellow of the Institute since 2011. Wendy was Chief Executive at Barfoot & Thompson until 2018, before becoming a consultant. In addition to serving four consecutive two-year terms on the REINZ Board, Wendy served twice as interim Chief Executive at REINZ, most recently, between Bindi Norwell leaving and Jen Baird assuming the role of REINZ Chief Executive. Garry has been involved in the real estate profession since 1977 and progressed through three Districts, various sub-committees and elected positions. He also spent five years as the Executive

Officer Member Services at the REINZ National Office. After gaining his AREINZ status, Garry was elected to the Wellington Committee. In 1986 Garry was elected to the Auckland District Committee, and in 1989, he became a Fellow of REINZ. Garry was the inaugural Chairman of REINZ ITO Limited until 2007, and in 2000 he was appointed to the Real Estate Agents Disciplinary Tribunal — retiring in March 2020. Robert is the Chief Executive of Harcourts Grenadier Real Estate and was included in the Harcourts Hall of Fame in 2004. With 42 years of service to the brand, he is the longest-serving member globally of Harcourts International. Robert set up the Grenadier franchise within the Harcourts Group in 1991, where his skills and leadership took that franchise to number one globally for many years. Robert now has 14 offices in Christchurch and approximately 300 staff. He has been a panel member on the REA and REINZ, became a fellow of the New Zealand Institute of Management in 2005, and a Fellow of REINZ in 2018. “To become a REINZ Life Member is a huge honour. It is recognition by the profession and peers of the significant contribution and service to the profession made by an individual,” Bridget said.

Garry Denley (Honorary Retired)

Robert McCormack (FREINZ)

Wendy Alexander (FREINZ)

Mark Coffey (AREINZ)

TO BECOME A REINZ LIFE MEMBER IS A HUGE HONOUR. IT IS RECOGNITION BY THE PROFESSION AND PEERS OF THE SIGNIFICANT CONTRIBUTION AND SERVICE TO THE PROFESSION MADE BY AN INDIVIDUAL.

AUTUMN 2022

LEGAL

Agreement for Sale and Purchase of Real Estate eleventh edition The eleventh edition of the REINZ and Auckland District Law Society’s Agreement for the Sale and Purchase of Real Estate (ASPRE) was released on 8 February. Joyce Chiu, In-house Counsel and Advisory Services at REINZ, explains some of the changes — and what brought them about.

Over the last 13 months, whilst the tenth edition, version two, of the ASPRE was in circulation, REINZ gathered feedback from members and industry leaders on what was working and what wasn’t. The eleventh edition addresses these issues, and we have received positive feedback from our members since its release. Additional space provided in the new format will benefit members, allowing for negotiations and longer legal descriptions. We are grateful for the input of REINZ’s Industry Leaders Group which provided helpful feedback before the reformatting was finalised.

What’s changed? The changes from the tenth edition, version two, to the eleventh edition of the ASPRE are significant. First and foremost, the document layout has been reformatted in several areas, including the front page, signatory page and back page. The latest edition includes provisions for the discontinuance of bank cheques — taking into consideration that many major financial institutions and banks no longer accept bank cheques.

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Joyce Chiu, In-house Counsel & Advisory Services, REINZ

There are also changes under the Purchase Price Allocation Rules. The eleventh edition includes new provisions to address the optional addendum concerning legislative changes to tax purchase price allocation rules, clarifications made to clauses 10 when claiming compensation, maintenance of the status quo in limiting liability (in light of the Trusts Act 2019), and further changes to the warning and signatory pages. Members will have also seen that the COVID-19 Provision released last year as an optional further term on eForms has been incorporated into this edition.

The Auction and Tender Agreements With the release of the ASPRE eleventh edition, REINZ and the ADLS ASPRE Sub-Committee are now working to amend the Auction Agreement and Tender Agreement to align with the eleventh edition — we will keep our members updated on progress. Members who would like a comprehensive run down on changes to the eleventh edition of the ASPRE, including legal implications, and the discussions that led to these changes, can watch the free REINZ webinar available via the REINZ Education Portal.

LEGAL

Progress on Unit Titles

(STRENGTHENING BODY CORPORATE GOVERNMENT AND OTHER MATTERS) BILL Joyce Chiu, In-house Counsel & Advisory Services, REINZ

With high density property arrangements becoming increasingly common in New Zealand, REINZ has taken an active role in the review of the Unit Titles Act 2020, supporting the proposal to improve the information disclosure regime, strengthen governance arrangements and increase the professionalism and standards of body corporate managers.

Many of our members will be aware that REINZ was part of the Unit Titles Working Group which drafted the Unit Titles (Strengthening Body Corporate Governance and Other Matters) Amendment Bill (the Bill). REINZ also filed submissions (mainly) in support of the Bill.

settlement should be appropriately balanced between the buyer’s and seller’s needs.

Now, 18 months since the Bill introduction, the Finance and Expenditure Select Committee has published its findings and recommendations.

Based on the advice the Select Committee received, it recommended additional disclosures vendors must include in the pre-contract disclosure, including details of weather tightness issues, other known defects that may require remediation, the body corporate’s long-term maintenance plan and copies of the body corporate’s financial statements and audit reports.

Recommendation from the Finance and Expenditure Select Committee In the Select Committee’s report, members supported the continuing obligation of the vendor to produce a pre-settlement disclosure but recommended the removal of the buyer’s ability to request additional disclosure — or the requirement for a body corporate to endorse the pre-contract disclosure statement.

It was also noted that this entire regime is dependent on the body corporate keeping records. However, there is currently no obligation in the Bill to hold bodies corporate accountable for failing to keep proper records.

Strengthening the disclosure regime is welcomed by our members as compelling a vendor to disclose all relevant information pre-purchase would better protect agents and purchasers.

It is clear from the Committee’s recommendations that the intent of the review is to lessen the administrative burden on bodies corporate and vendors. In line with this objective, the recommendations included the right for the vendor to delegate disclosures and remove the requirement to discuss with the buyer any issues arising from the disclosure.

Body Corporate Management standards heightened

Additionally, it was found that a buyer’s right to cancel the contract shouldn’t be so easily exercised due to its tendency to affect the parties, and the right to delay or cancel

The Bill now awaits its second reading in parliament as we wait to see whether the Select Committee’s recommendations are implemented.

Although REINZ would have ideally liked to see this go further and require regulation of body corporate managers, it is very pleasing to see the Bill will require Body Corporates to implement a code of conduct, as well as robust systems in conducting their reporting and administrative functions.

AUTUMN 2022

LEGAL

Balancing privacy rights WITH HEALTH AND SAFETY CONSIDERATIONS IN THE REAL ESTATE SECTOR Louisa Joblin, Associate Commercial Lawyer, Rainey Collins

The Government’s COVID-19 Protection Framework, which came into effect at the end of 2021, contains new regulations and guidance for employers. Some sectors are now subject to vaccine mandates and will be required to keep records of their employees’ vaccination statuses.

While the real estate sector is not currently subject to a vaccine mandate, real estate agencies are encouraged to undertake a risk assessment to determine whether their business activities should be carried out exclusively by vaccinated workers on health and safety grounds. In this case, ‘workers’ include any person required to operate the business or service, which includes paid and unpaid individuals. Given many real estate roles are client-facing, health and safety risk assessments may conclude workers need to be vaccinated to operate in their roles effectively while ensuring that risks are kept to a minimum.

Vaccination Assessment Tool The Government has provided a Vaccination Assessment Tool (VAT), to assist employers in determining whether they can require work to be carried out exclusively by vaccinated workers. The VAT provides four criteria in relation to a particular role or job, and employers must grade each of these as either ‘Lower Risk’ or ‘Higher Risk’. The four criteria are:  Does the worker work in an indoor space that is less than 100 metre2?  Is it unreasonable for the worker to maintain one-metre physical distancing from other people?  Is the worker in close proximity to any other person for more than 15 minutes?

The Real Estate Institute of New Zealand

D oes the worker provide services to people who are vulnerable to COVID-19? Where an employer grades at least three of the four criteria as ‘Higher Risk’, the Government deems it reasonable to require a vaccinated person to perform the role.

Health and safety plans for real estate agencies It is strongly recommended that after undertaking a risk assessment or use of the VAT to assess the risk of workers, agencies establish health and safety plans with the assessed level of risk in mind. Records of workers’ vaccination status may only be taken and stored if worker vaccination is mandatory, or the information is material to the operation of an employers’ health and safety plan. It is important to remember that vaccination status is personal information per the Privacy Act 2020. As such, health and safety plans should address issues such as whether the agency needs to know workers’ vaccination status and, if so, whether the agency needs to store evidence of their workers’ vaccination status or can simply record it without evidence. Generally speaking, an approach should be taken which keeps the collection, use and storage of vaccination information to the minimum level required to comply with the health and safety plan.

LEGAL IT IS STRONGLY RECOMMENDED THAT AFTER UNDERTAKING A RISK ASSESSMENT OR USE OF THE VACCINATION ASSESSMENT TOOL TO ASSESS THE RISK OF WORKERS, AGENCIES ESTABLISH HEALTH AND SAFETY PLANS WITH THE ASSESSED LEVEL OF RISK IN MIND. How should personal information be stored? Where agencies elect to store information about their workers’ vaccination status, the manner of storage must ensure that information is kept safe and secure. While individual workers will have varying levels of concern with respect to others having access to their vaccination status, the safest approach is to treat every worker’s vaccination information as sensitive information and protect it accordingly — with policies and procedures to ensure compliance with the Privacy Act. Ideally, this will simply be an extension of practices already in place for agencies to protect personal information.

Ensuring reasonable safeguards The Privacy Act emphasises that

employers must ensure personal information about employees is protected by such security safeguards as are reasonable in the circumstances. The Act explains that those safeguards are to protect against loss, unauthorised access, disclosure, or other misuse. The definition of what exactly constitutes reasonable safeguards in the context of protecting sensitive information can be a source of confusion. Whether the safeguards put in place by an agency to protect sensitive information are reasonable will vary depending on the circumstances. For example, keeping client files on a password protected computer system where all staff can access them for work purposes is likely to be reasonable. However, keeping workers’ vaccination information on a system accessible to all

staff would not necessarily be considered reasonable due to the risk of other workers accessing the information for purposes not directly associated with work. Ultimately, all agencies will need to store employee vaccination information in a way that securely restricts access to only those who legitimately require it, such as to assess compliance with the health and safety plan. Failing to adequately protect workers’ personal information may result in a notifiable privacy breach, which may legally require the employer to report the breach to the Office of the Privacy Commissioner. Failure to report a notifiable privacy breach can result in a fine of up to $10,000. Privacy breaches can also have major reputational consequences which extend far beyond the financial implications.

AUTUMN 2022

OBITUARY

Ross McRobie It is with deep sadness we announce the passing of Ross McRobie, a valued member of the Property Brokers family. Ross sadly passed in November 2021, after a short battle with melanoma. He was well known to many Cantabrians and West Coasters from his time as the Chairman of the Hastings McLeod, EV Arthur, and Buller Real Estate Boards from 2016 through to 2019. During this time, Ross did fantastic work as the Chairman of the Boards to help grow and develop the business, and he very quickly became a proud member of the Property Brokers family. He had a wonderful personality and very much enjoyed getting to know the team and being part of it. Since stepping down as the Chairman of the Boards, Ross shifted to Otematata, took out his real estate license and joined the Property Brokers team on the ground as a sales consultant based out of the Oamaru branch. The team at Property Brokers are saddened to have lost a member of their family. Their thoughts and best wishes — and ours — go out to Ross's family at this difficult time.

The Real Estate Institute of New Zealand

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REINZ Real Estate magazine - Autumn 2022

Articles inside

Balancing privacy rights - with health and safety considerations in the real estate sector

Progress on Unit Titles (Strengthening Body Corporate Government and other matters Bill)

Agreement for Sale and Purchase of Real Estate eleventh edition

REINZ hosts its 2021 Annual General Meeting (AGM) online

No suprises - why getting to know a property before listing is always worth the time and effort

Fail to plan and plan to fail - importance of planning for real estate success

First-time home seller? Make their first one a good one

Bidding farewell to two influential REINZ Regional Directors

Connecting through understanding

Auctions paving the way in the market

Member relationship management — the good oil

PropTech — drivers, trends and engagement

2021 in RPM — a year of Cs

Ever-increasing value of privacy

Getting the job done — a hybrid style

A record year for dairy reinforces confidence in the sector

Ensuring a positive home-buying experience for new kiwis

2022 — a year of recovery

Making homes inclusive for all

Could 3D printed homes fix our housing shortage?

The future is green — a sustainability mindset

Nelson and Tasman - Climbing the ladder of the south

Changes to the CCCFA

REINZ Real Estate magazine - Autumn 2022

INDUSTRY