Broking a Change-over: Paradigm shifts in Brokerage
With rising awareness of property buyers, the real-estate brokers would need to evolve from mere facilitators of buying or selling of property to be a complete service provider and an advisor.
The introduction of the RERA has completely changed the dynamics of the sector bringing in transparency and protection of consumers rights. Under RERA, for the first time the property brokers have been recognized as an important stakeholder and it intends to register and verify them for the benefit of both the brokers as well as the consumers. This will allow the professional brokers credibility while, consolidating the entire segment.
Till now, the unorganized nature of the real-estate sector and the lack of accreditation requirements of real-estate brokers had made it challenging for a consumer to assess the credentials of a broker. With the introduction of greater professionalism and accountability in the sector, to remain relevant, the brokers will need to upgrade their skills as their role now changes to be a critical advisor, consultant and a negotiator.
The Indian real -estate industry predicted growth to almost 180 billion USD by 2020 by IBEF 2015 Report translates into at least 11 per cent increase in employment for brokers/realtors by 2022.
There are various national and international level professional bodies and associations that represent the interests of brokers, introduce standards of practice and offer requisite professional training. Realty Plus spoke to some of the eminent brokers representing the prestigious brokers/realtor professional association on the paradigm shift in the role of a broker and the way forward for the sector.
President – Association of Real Estate Agents (AREA)
Founder & CEO – MumbaiProperties
Chairman – National Association of Realtors (NAR) India Convention
CEO – Square Feet Property Consultant Pvt. Ltd.
World President FIABCI 2017-18
Chairman & Managing Director, Silverline Group
The evolution of broking sector in India over the years
Padhi: The real- estate broking sector has undergone dynamic changes over the past decade in particular. Realtors have evolved from being mere “middlemen” to professional facilitators of key services for a real estate transaction. This progression has helped the realtor community to enhance its credibility by several notches and has also created lucrative earning opportunities by offering value-added services to clients. Since the modern consumer has easy access to information, thanks to the internet, realtors too have gradually imbibed essential knowledge in areas like legal, regulatory, home loans and the needs of NRI buyers too.
Thakkar: Over the years this industry has seen many changes like individual broker to professional organizations with trained manpower, neighbourhood centric to global reach businesses. Mostly referrals lead to professional methods of lead generation. The new mantra is to provide “End to End Solution” to the customer in property, legal, taxation, housekeeping, moving in etc. The word Dalal or agent has moved to Property Consultant.
Mahmood: In years gone by, people took it upon themselves to deal with real-estate transactions. However, due to the unorganized nature of this sector, the need for a more professional network trained in the art of real-estate was felt. This void was quickly identified and filled by the emergence of a professional group of individuals specializing in transactions of real-estate.
The synergies between the global & Indian Realtors organizations
Padhi: With the Indian economy showing tremendous promise and growth for international buyers, the realtor community of India is extending its span and has created a lot of trust and security along the way. Professional bodies like NAR India, with its affiliations with NAR, USA, are a prime example of the confidence global organizations are placing in us. With the implementation of RERA, a lot of synergy is being developed between Indian and foreign realtor organizations and this has opened doors to massive cross-border opportunities too.
Thakkar: Technology has played a vital role in helping the business grow beyond the geographical boundaries of city, state or country. This has brought us in line with the players from the developed economies. Though there are certain challenges in terms of matching the business approach of global players, there are some great advantages in this collaboration with the new global players which will help local player to go GLOCAL (business opportunities across geographical, cultural boundaries). Synergies will bring huge growth opportunities & knowledge sharing. Policy changes like RERA will certainly help Indian real estate consultants to adopt a more professional and systematic approach towards the business.
Mahmood: Today, India is the fastest growing economy in the world, but its potential as a profitable real-estate market was recognized years ago by foreign realty organizations. As of today, various International brands such as the Trump Group, Jade Jagger and Giorgio Armani have entered India. Recognizing the global nature of real estate business, The International Real Estate Federation (FIABCI) was established to provide access and the opportunity to network and conduct international business. The emergence of such an organization is a testament to the growing synergy between realtors across the world.
The way forward for the real-estate and broking sector
Padhi: Every single realtor in India has to register with RERA in their respective states and their roles have been defined clearly by the all-encompassing RERA regulatory body. The traditional realty broking market can be expected to be disrupted for a while before it gets its act together and metamorphoses into a transparent and professional entity. All this will weed out superfluous elements in the real estate and broking sector and fetch desired respect for genuine and professional work.
Thakkar: In times to come, CHANGE will be the biggest challenge for majority of individual consultants for growth as the revenue generating products will be different. Right from selling of affordable housing which would be small ticket size but a number game opportunity pan India, to arranging private equity for developers and REIT listing process etc. big revenue generator products would remain in the hands of IPCs and big broking houses only. This would require broking businesses to become more organized and professional in their business practices, they will have to collaborate to achieve growth, hire professional, educated and skilled manpower.
Mahmood: Measures such as the introduction of RERA, GST and Smart cities have changed the landscape of the Indian real estate market and evolved the role of brokers. With stringent norms imposed by RERA, only professional agents with credible business practices are likely to thrive. Brokers who are seen to offer credible advice and have hyper-local market knowledge will be much sought after. RERA also seeks to bring accountability on behalf of realty developers by disclosing all approvals, timelines and the project master plan before launch.All in all, these changes are made with the intention of putting India on the fast track of modernization. With proper implementation and accountability, the Indian real-estate market is set to be revolutionized.