Agents of change

Over 2,000 bankers in Poland could soon be losing their jobs. Banks such as Nordea, BNP Paribas, City Handlowy, BPH and DnB Nord have all announced lay-offs since the beginning of the year. Will some of the redundant bankers find new jobs on the property market? Home Broker is planning to employ as many as 500 people in the near future and is specifically targeting people who have lost jobs in the banking sector. Real estate agencies are no longer exclusively dealing with the secondary property market and are increasingly often teaming up with development companies for the sale of apartments on the primary market.
Developers looking to cooperate
"We have been observing what is for us the positive trend of developers entrusting us with the sale of primary market apartments. We are cooperating in this respect with 53 developers across the country. The sale of apartments of this type has increased by app. 15 pct compared to the same period last year," claims Joanna Dobroś, development director of the KNC Nieruchomości franchise. Meanwhile, the number of developers the Home Broker chain has signed cooperation contracts with has grown to 450. The contracts have been agreed with small companies, for whom it constitutes the exclusive means of distribution for their apartments, and also with the biggest (often public) companies on the market. The company currently offers apartments by J.W. Construction, Dom Development, Gant, Marvipol, LC Corp and Murapol, among others. "The number of developers we cooperate with is constantly growing. The advantage our company has over developers' sales departments lies in the fact that we are brokers. We do not have to worry about the fact that a product has missed its target market and sells poorly. We can help developers when they want to draw the market's attention to a project, provided they use our experience when deciding upon their sales strategies," says Damian Milibrand, president of the management board of Home Broker. In 2011 the company sold 2,605 apartments from the development sector and in the first quarter of this year as many as 883 apartments. If the trend continues, there is a chance it will sell over 3,000 apartments from the primary market over the whole of 2012. "The cooperation between agencies and developers is improving all the time. In the last few years a lot of established development companies have become convinced about the efficiency of selling through this new channel, i.e. real estate agencies; and now new developers, encouraged by the successful sales under this arrangement, have also started turning to agencies in order to start cooperation," confirms Włodzimierz Wielogórski, the primary market director of Metrohouse & Partnerzy.
As close as possible to the client
So perhaps developers have abandoned their own sales departments? "Robyg is putting emphasis on developing its own sales department, not only because it involves a higher level of involvement from its employees, but also due to the greater flexibility it gives us in terms of our offer. It is worth reacting swiftly to the changes happening on the market, while the implementation of new solutions requires a continuous flow of information. Our own sales office also allows us to have the best research department with regard to clients' expectations, which makes it possible to analyse the efficacy of marketing activities. In my opinion, cooperation with agencies is only one of the channels for reaching clients that is worth using. Of course, we take into consideration the benefits that can result from the partial outsourcing of sales. So far we have been satisfied with this solution," explains Marcin Wolski, the manager responsible for marketing and PR at Robyg, one of the biggest developers in the capital city. This stock exchange-listed player is hoping to find buyers for over 1,000 apartments this year. Another Warsaw-based developer, Marvipol, has had a similar experience. Its sales plan for this year envisages more than 500 new sales contracts. "The basic channel for selling apartments at Marvipol is its internal sales department. We treat the services of external brokers as a supplement, and they currently generate app. 20 pct of our sales. Taking into consideration the structure of our clients, it is necessary to maintain our own sales structures and we will extend our own departments as the scale of our operations expands. A lot of our clients come to us on somebody else's recommendation and want to buy an apartment in a finished project," explains Andrzej Nizio, president of the management board of Marvipol. Damian Milibrand confirms that there are a few companies where Home Broker is responsible for a share in sales exceeding 20 pct. "There are even companies that sell more through our channel than on their own. There are also cases of developers giving up on their sales departments completely in favour of our services," emphasises the head of Home Broker. Developers abandoning their own sales services usually results from two facts: the company is too small to create structures of this type or it is entering new markets it is often unfamiliar with and prefers to entrust its sales to an agency that is already established there. However, Włodzimierz Wielogórski of Metrohouse & Partnerzy admits that both buyers and developers are signing more contracts directly. This is not necessarily the result of both parties' lack of willingness to cooperate with brokers, but from market conventions. Nevertheless, the general direction is increasingly following that of mature markets, such as France. The history of the operations of both developers and real estate agencies is very short in countries such as Poland, where the scene has been traditionally dominated by housing cooperatives.
Who will be buying?
"I believe that we should convince customers to use the services of such companies as ours. At the same time I am against imposing such an obligation from the top down, even though there are countries where properties can only be bought via an agency. All the services we provide result from the needs signalled by our clients. The overriding need in the case of property purchases is to restrict the risk connected with such a transaction. Clients also come to us for other reasons, such as because it saves time," says the president of the management board of Home Broker. In his opinion the chance to meet a property consultant and a financial consultant in one place is a significant advantage. Thanks to this, time is not lost looking at offers that are out of our financial reach. Moreover, clients who are planning to buy an apartment from the secondary market may change their mind after familiarising themselves with an agency's more comprehensive offer. "As opposed to ordinary brokers, our consultants do not make contact with clients through property ads, but through offering consultancy services. Come to us and we will identify your needs, tell you what you can afford and find a suitable property," explains Damian Milibrand. Agencies have to face one more challenge: to convince clients that they will not bear any additional costs when they buy an apartment from the primary market from an agency, while the benefits of such transactions will compensate for the possible discounts available in a direct purchase from the sales department of a developer. "Clients are increasingly aware that the amount in the final price negotiations for a property purchase is not affected by the remuneration paid to an agency by the developer, but on many other, individual factors. They also appreciate the convenience provided by listing a large selection of apartments in one place, with the added support of consultancy services," says Metrohouse & Partnerzy's representative.
Safety first
According to a study carried out by Home Broker, clients are induced to use agency services when buying an apartment first of all by the safety of the transaction and the access to a large number of offers in one place. Other motives include: the advantages of using the knowledge and experience of specialists, the time-saving, the consultation on financing the purchase of an apartment (crediting), and finally the ad for the actual apartment. Agencies are introducing improvements all the time to attract buyers. Metrohouse & Partnerzy brought in two new services in April: an apartment with a guarantee and a professional receipt for an apartment from the developer. Having chosen such a purchase option, buyers will be able to count on the help of a building inspector, who will advise them on the receipt of the apartment. The idea is to convince people to make this step who do not want to buy an apartment on the primary market due to their unfamiliarity it with and the feeling of being lost on the construction and renovation market.
Up and onwards
Home Broker currently has 53 branches in 29 towns and cities all over the country, with a total workforce of over 900 people. This number is to grow to almost 1,500 if the company's plans go ahead to employ 500 new people. Will this be reflected in the number of new branches? Not necessarily. The new employees will generally work in existing branches. "We are facing decisions that will need to be made in connection with the further development of Home Broker. Perhaps we will open ourselves up to franchising in order to enter smaller towns," adds the head of Home Broker. The KNC Nieruchomości agency became focused on franchising earlier. "We have six own branches and 53 franchised ones. The employment level in the KNC chain will continue to grow due to the opening of new branches," reveals Joanna Dobroś, the development director of the KNC Nieruchomości chain.