Enter the new age broker

CHANGING GAME

This transformation in the real estate brokerage scene in India has been driven by many factors. First,the opening up of the economy and influx of international companies into India has brought about a major demand turnaround in real estate services. That has in turn translated into demand for real estate brokerage services that have best practices benchmarked with the best in global standards.

Second,the growth of information technology has brought about a revolution in the way business is conducted. Internal business processes could be completely automated to suit ease of working.

Third,the volumes of transactions and consumer preference and choice demanded that systems be developed so that the customer can search,view and select from the comfort of his home. Inputs for decision making had to be made more comprehensive and at the same time,simple.

Fourth,the relaxations and incentives for investments by the NRI and PIO market led to the emergence of a new demand where it was not practically possible for international clients to physically travel and see the properties before making the decision to purchase. This was where IT-enabled solutions came to their rescue.

One additional factor has been that there were quite a few international property consultants who made inroads into the highly disorganised brokerage industry in the country and started providing high quality services,backed by mandates. This made the local broker look up and start to address the growing competition from corporate brokers.

All these factors have led to domestic brokers waking up to the need to get their act together,if they wanted to remain in business.

They started out on a series of measures. Some were simple,such as sprucing up their offices. Websites started mushrooming. Listing properties on the internet became a common practice. They increasingly started resorting to e-marketing. Brokers started streamlining their internal processes.

They have next paid attention to the softer side of the game. The attire and the technique of communication started changing. Brokers started attending classes and signed up for a range of courses from personality development to principles and practice of global real estate business. Increasingly,the brokerage industry has witnessed the entry of highly qualified professionals. From the image of the broker we encountered at the beginning of this article,the broker today may well be an engineer,MBA,advocate,retired personnel,chartered accountants among others. Well-educated women too,are choosing this as a career option.

These factors are slowly,but surely transforming the real estate brokerage industry. The makeover is for real. The new-age broker has arrived.

Most corporate clients can avail the services of international property consultants for whom clients are not really a problem as they came from international referrals. Individual customers,however,had no option but the local untrained broker to deal with. This demand for quality is now being filled by the new-age local brokers,who are home-grown,but equipped and skilled to provide the best in quality standards and customer satisfaction.

The new age broker is there for the discerning customer; he is there to hand-hold,guide,advise and take the customer through the entire process of making a property purchase decision in a transparent,thorough and clean manner. The customer does not really mind paying a fee for good quality service and assurance. The property transaction experience thus becomes an enjoyable one.

ORGANISING THE PRACTICE

To enable the growth of the brokerage industry,it is necessary to institutionalise best practices. In pursuit of this goal,the National Association of Realtors India NAR-India has been formed as the apex national level association for realtors in India.

The association has a member-coverage in 25 cities in the country and aims to nurture,incubate and groom new-age brokers who can provide

quality service and customer satisfaction. The objectives are to empower and enable brokers to acquire skills and

emulate best practices.

NAR-India has a strategy of ensuring that all the member-brokers acquire basic real estate education so that the interest of the customer is not jeopardised. The association through its programmes grooms and prepares the local broker for the international market on the one hand,and brings international standards and business practices to the local real estate market on the other.

The association has been striving towards standardisation of business practices. Members are bound by a Code of Ethics and follow modern standardised business practices. The orientation of the whole exercise is that the customer comes first. It is also pursuing the objective of bringing about a multiple listing service MLS,something common to most evolved markets,in order to enhance business efficiency. Simply put,the MLS is a bouquet of services that accumulates and disseminates listing information among broker participants.

Members follow standard globally accepted practices of servicing so as to ensure transparency in the transaction process. NAR-India is also working on advocating Exclusive Mandates and One side representation for the benefit of the customers. One side representation is where the broker declares whom he is representing: the seller or the buyer.

The association has also taken steps to educate brokers and facilitate the upgradation of their skills. NAR-India’s three-pronged strategy comprises: a a basic real estate member entry test or REMET,b a higher level real estate programme and c an advanced course on principles and practice of real estate.

Members are being encouraged to take up education and skill upgradation programmes on a continuing basis.

REGULATION

The association strongly advocates government regulation of the brokerage business. In most evolved real estate markets,brokers are Licenced to Practice,through education and adherance to standards as in the case of other professions such as law,medicine,architecture or chartered accountancy. In the absence of such a regime,any person is free to enter the profession and that is one of the principal reasons why the real estate industry is so murky. It is unfortunate that the just-released draft Real Estate Regulation Bill does not recognise the importance of brokers to the real estate industry and the need to have a healthy brokerage practice.

The National Housing Bank NHB,the regulator for housing finance in India has developed RESIDEX,the first-ever national housing price index. NAR-India has signed a Memorandum of Understanding with the NHB to provide key inputs for the formulation of this index.

These measures that the association has initiated,are geared towards achieving the twin objectives of enhanced service quality and greater transparency. If these best practices are disseminated effectively,then real estate brokerage can well be another flourishing sector within the services sector and can provide employment to millions in our country.

As the real estate industry comes of age,more individuals are taking to the business of property brokerage seriously as a career option. So long as the new age brokers adhere to the good old principles of honesty,sincerity,transparency,clean dealings,due diligence and a ‘customer first’ attitude,there is a lot of money to be made in this business.

It is high time the government recognises the significance of the real estate brokerage industry in India. It has to ensure their greater involvement in decision making on key issues and make policy more meaningful and inclusive.

The author is Professor,SPA,New Delhi