Luke Pervan, CEO of Betterway Real Estate, explains why he believes the new company disrupt the real estate industry in Newcastle.
You have just launched Betterway Real Estate in Newcastle as one of your first forays into regional Australia. Why the Hunter?
Often the regional markets of Australia are overlooked by their city counterparts. One of our differences is that we believe Newcastle buyers and sellers are just as important as city buyers. Our insights and research show that the significant savings, service and transparency delivered through Betterway Real Estate’s model will benefit the local market.
Your company offers a “new model” for selling and buying homes. How?
Betterway Real Estate uses a fixed and fair price model for home buyers and sellers to disrupt the real estate industry in Newcastle. We deliver this model alongside an app that connects all suppliers in the sales process allowing full transparency for customers through the sales journey. Through our fixed and fair model, the home seller pays a fixed amount to sell their home. Of which only a small percentage of the total is paid upfront to cover marketing and advertising. The customer then pays the remainder of the fee once the sale of the house is successful, removing and concerns over motivation to sell. Doing away with the commission-based model traditional real estate agents use, means owner know exactly what they’re paying for from day one and also saves them a significant amount of money.
What evidence is there that it is robust and fair?
We’ve seen many players in the Australian real estate market forget about the customer and we feel it’s time for a better way. By putting the customer first, we’ve focused on providing exceptional service and value.
Our model offers consumers on both sides of the transaction transparent fees and honest, open communication with agents. This model is emerging around the world and we’ve put together all the best elements of the fixed price model and enhanced the offering. It’s fair because customers know exactly what they’re paying for upfront with two fixed-fee options to choose from.
Why is the smartphone app central to the process?
The Betterway App is an integral part of our offering and gives total transparency across the selling and buying process, meaning customers can check-in at any time.
We know how important face-to-face relationships are in this business, that’s why we are launching with local agents in the Newcastle region who have local knowledge and expertise, and a proven track record in their region.
The app simply complements Betterway Real Estate Agents’ dedicated local Sales Partners in each region, to ensure customers have access to updates 24/7.
Why offer two fixed-fee options for those selling?
The difference between the two prices is an increased level of marketing and advertising. Consumers who are in competitive markets may want to switch on increased marketing to maximise their exposure. Our sales partners will work with each individual homeowner to decide on the best strategy for their specific circumstances.
How can you guarantee you will save homeowners between 30 and 60 per cent in fees?
We’ve researched the market and developed two fixed-price options which represents a fair price for real estate services in the regional markets we’re launching in across Australia. This removes the need to negotiate fees with the agents which can be from 2 to 5 per cent of the home sale price. Based on the property value of the average Australia free-standing home our fixed-fee options could save sellers up to 30-60 per cent as opposed to negotiating fees with another agent. A 2 per cent commission on a home worth $710,000 (the median home price in Newcastle) is $14,200 with an average on top marketing costs of $2,000. With Betterway Real Estate’s fixed price of $9,500, there is a significant saving of $6,700 for homeowners selling their property.
Many are sceptical about real estate values and agents. How can you guarantee transparency?
With our app customers are kept up to date 24 hours a day on the progress of their sale. We’ve also hired a group of well-established local agents who have in-depth knowledge of local property prices and can guide an owner on the best strategy to sell.
Is the Betterway system more advantageous to sellers or buyers?
It will benefit both sellers and buyers as both have a transparent view of the fixed price being charged and can access the app to get updates 24/7. Customers selling can also save a significant amount of money through the fixed-price model.
How are the Newcastle and Hunter markets?
They’ve seen a correction in pricing over the last 12 months. There are really positive signs of renewed buyer activity, especially in Cessnock and Maitland.
Where will your headquarters be in Newcastle?
We aren’t intending to open a vanity bricks and mortar office in Newcastle. Our model aims to disrupt the real estate industry in Newcastle and specifically removes overheads such as shop front, allowing us to cut down on costs that traditional real estate agents incur and pass those savings onto the customer. We have started with three local agents in Newcastle and have plants to have six agents in the coming months.
Published in Newcastle Herald, 15 October 2019