Then and now in rural real estate

Reflecting on the past 29 years, Shane O'Brien takes us back to the traditional ways of work in the rural real estate sector and sheds light on everything that's changed. One thing remains eternal — it's a business based on loyalty and trust.

I started my real estate career in 1993 with the stock and station company Pyne Gould Guinness out of their Rangiora store in North Canterbury.

That was then

It was a busy place with farmers coming and going picking up grain and seed, sorting insurance, purchasing stock food, and fencing supplies. Our technology was limited to a radiotelephone in our cars for communication with the offices and other salespeople, and a modern facsimile machine in the office we all shared. Realenz (the precursor to realestate.co.nz), emails and cell phones were still a couple of years away.

Our marketing was specific to the Saturday paper, signboards, and many phone calls — usually at night when farmers were in, as we couldn't reach them during the day.

Buyers took what was stated as the carrying capacity and fertiliser history with little questioning. The deal was then done, and the solicitor was told about the sale after the paperwork was completed to save the farmer a trip to town to discuss the sale and the subsequent bill in the mail!

It was a business built on loyalty and trust. Your word was your bond, and your reputation was all you had.

Some 29 years later, much has changed, yet many things remain the same.

This is now

The demands on the rural salesperson are constant, and the necessity to be consistently at the top of your game is paramount. The buyers, as well as their advisors and bankers, are far more informed on all aspects of real estate, farming, and business. As such, their requirements for up-to-date specific property information are insatiable as everything around them is also changing faster.

Complying with the Real Estate Agents Act, the Fair Trading Act, and the Consumers Guarantee Act is now complimented by the stringent requirements of the Resource Management Act, Emissions Trading Scheme, Regional Council policies, National Policies on Freshwater, Environmental Standards, and the constant battle to reduce carbon emissions, methane gases and irrigation water requirements.

The need to identify red flags has never been so important as the environmental capacity of properties now clearly drives value. Never in my career has the value of properties been so heavily driven by external factors. The recent National Environmental Statement determining what land may be used for winter dairy cow grazing has the potential to impact land value significantly.

A salesperson's ability to determine what has been the on-farm practices to date are now challenged by these new standards — and any representation they may make needs to be almost at the forefront of science.

It is a massive challenge for our profession to keep on top of these constant changes. Most significantly in terms of farm values and equally personal reputations. The need for our members to form alliances with farm advisors, environmental offices and regional authorities and have regular updates is critical to enjoying continued success in the rural marketplace.

How working with vendors has evolved

There is a new term that I picked up from a successful local rural-based solicitor recently — vendor due diligence. To bring together all necessary information on a rural property in preparation for sale is now a team effort we need to coordinate. The traditional 'few days to go live' can now be weeks. Particularly as reports are commissioned from often very busy advisers to have the required information on hand at the time of the release of the farm to the market.

Whilst it may not always be practical, I think it's helpful for rural salespeople to collaborate more with vendors' advisers in getting a farm ready for market. Getting all advisers on the same page at the start of the process will always lead to a better outcome for vendor clients. Although there may be a cost in doing so, and it can slow down the preparation process, the cost of not doing it risks being substantial if we don't fully understand the capabilities and capacity of the farms we sell.

I cannot encourage our members enough to slow down and get these important preparatory steps done well. This will undoubtedly lead to a better outcome as the cost of having information that is not up to date can be detrimental.

While everything changes around us, there is one constant — the role of the rural real estate professional in bringing all this together to ensure the best outcomes are always achieved with no loss in farm value or personal reputation.