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House Talk

No. 33 - April, 2009

Market Overview from Down Under
A talk with Judith Glass and Janet Kayes

G’day mates! Judith Glass here just back from a visit to Southeastern Australia where the skies are blue, the people are friendly, and the dollar is strong! The autumn season is just beginning on this fascinating continent and the weather is similar to our September days – warm and inviting. On one of my last days in Sydney, I had a chance to meet with one of the top realtors in this beautiful New South Wales city to talk with her about how the Aussies buy and sell houses. More about that in a bit.

While travelling to historic Adelaide, the capital city of Canberra, the wine country of the McLaren Vale, the unique Kangaroo Island and finally to Sydney, the “pearl of the Pacific,” I made some observations that I’d like to share. My constant companion (besides my husband who went to Australia on business) was a wonderful book loaned to me by a friend – In a Sunburned Country by the American writer, Bill Bryson. I even met an Australian fellow who had read this most entertaining travel narrative, and I found it to be not only laugh-out-loud funny, but useful and informative as well.

So let’s say you visit Sydney (and I highly recommend that you do – the Sydney Harbour is staggeringly beautiful and quite user-friendly.) The ease of traveling around the city makes for a stress-free visit. Like to travel by water? Take a ferry or a water-taxi. Want an overhead view? Take the monorail. Traveling on a budget? Buy a week-long pass that gets you on any ferry or any bus. Like to walk? You’ve come to the right place. Then of course, there is the convenience of the language – Australian English is the closest to American English that I’ve experienced. For the years that I lived in London, the only person I could ever understand very clearly was Queen Elizabeth herself who speaks ver-r-r-ry slowly and carefully. No wonder Michelle Obama gave her a hug!

So meet Janet Kayes, a “principal” and a “licensee” in the Ray White Domain Harbourside agency - a family-owned company which is based in Queensland and has offices all over Australia and New Zealand. The company is expanding rapidly and currently looking at opening offices in India and other countries overseas. Sipping our coffees on The Promenade of the King Street Wharf, overlooking the sun-dappled waters of the bustling Darling Harbour, Janet was gracious to answer all my questions about the local real estate market. Like most agents in Sydney, Janet represents sellers (not buyers) and the system differs from our own in one huge way – sellers have the option to sell their home through an auction process. For example, a seller lists his house (normally the listing is for 16 weeks whereas ours is for 90 days.) As part of the agreement, the Sydney seller can instruct his agent to publish the property to be sold at auction which occurs within 3 or 4 weeks of the listing date. The auction date is set, and the auction occurs either at the property itself or, if several properties are to be auctioned at the same time, there are even auctions held at the Taronga Zoo, or at a local Mercedes Benz showroom! To participate in an auction, qualified buyers register in advance, are given a number and they (or a representative) must be present at the auction.

Sellers pay less brokerage fee than our sellers pay here in the Bay Area. But if you are a potential seller, don’t get too excited! Whereas in our local market, the sellers’ agent pays for all the marketing and adverting expenses, the Sydney sellers pay those costs. And in addition, the paperwork for each transaction involves a review by either a solicitor or a conveyancer, professionals who provide the service that the title companies provide for us here. The sellers pay those fees. Plus, if the property is sold at auction, the auctioneer is paid by the seller. So, the fees paid by the seller are actually on a par with what sellers pay here.

Buyers, on the other hand, are not represented by an agent. Potential homeowners search on two main internet sites - domain.com.au or realestate.com.au and contact the agent representing the property for a showing. Open houses are held on Wednesday or Thursday afternoons or on Saturdays. Never on Sunday!

Whereas the Bay Area agents rely heavily on the Multiple Listing Service (the MLS) to provide information about what properties are available to be shown to our buyers, the above–mentioned internet sites are the only informational vehicle for agents and buyers alike. Janet told me that as part of her service to her sellers, she pays to upload and post her listings on the internet.

An article in the weekend Sydney Morning Herald caught my eye. The headline read “Rise of the Buyer’s Agent – How they can help you bag a bargain!” When I asked Janet about this trend, she told me that actually not many people choose to work with a buyer’s agent because guess what! The buyer’s agent has to be paid directly by the buyer – and not many buyers are willing to absorb that extra expense.

Like the Bay Area, the Sydney market is basically healthy but experiencing the same ups and downs driven by the uncertainties of the world-wide economy. However, as the newest self-appointed member of the Australian Fan Club, I wouldn’t blame anyone who would want to become a Sydney homeowner. And realtor Janet Kayes could show you how!

Janet Kayes can be reached by email at janet@domainharbourside.com.au. You can also check the website at www.domainharbourside.com.au. Janet handles sales as well as corporate leases.

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