Recruiting after the property boom
The New Zealand Reserve Bank took action in 2013 by introducing a loan-to-value ratio (LVR) restriction, which limits how much banks lend against a mortgaged property compared to the property’s value. Further changes to the LVR have been applied in recent years and, from last October, property investors have required a 40% deposit for a mortgage loan, while owner-occupiers need a 20% deposit.
In addition to this cooling effect on the property market, the recent change of Government has created uncertainty around new housing policies. In October this year, Auckland recorded its first annual decline in house prices in six years, signaling an end to the property boom.
How will changes to the property market impact employment in the real estate and property industry? Experts say demand for key roles is as strong as ever.
Skills in demand
Chris Kennedy, CEO of Harcourts in New Zealand, says the country’s real estate market has experienced a contraction after several years of robust growth. However, recruitment and training of talent remains a constant point of focus for the business.
“We’re seeing a reduction of between 14-16% in our volume of written sales, which is a direct measure of market activity,” he says. “After years of growth, many sales consultants simply haven’t experienced the kind of market that we currently have, so there is an inherent need to train them quickly because the skillset required in a buoyant market is different to what you may need in a slower market.”
Putting people first
Harcourts is a franchised operation that employs approximately 4,000 people across 197 offices in New Zealand. Kennedy says people are the focus of the business.
“Our business is all about people,” he says. “People – our team and our clients – are at the centre of everything we do. This means we have to invest time into our recruitment process to make sure we’re recruiting the right people who are suitably qualified and then suitably supervised. I always say that we recruit for attitude and train for skill. People are our focus and, in this industry, the impression you make is so important.”
Culture and career development are also key to the Harcourts retention strategy. Initiatives include the Harcourt Academy, which conducts more than 1,300 training programs each year. “We believe in supporting our people,” says Kennedy. “Real estate was once viewed as an industry that you got into if you couldn’t think of anything else to do, but now we are seeing more people viewing it as a career and we want to help them to develop.”
Investing in training
Job advertising for the real estate and property industry on SEEK remained flat for the period of August to October and the average advertised salary was $85,211.
Fields such as commercial sales, leasing and property management grew by 14% year-on-year over the three-month period and administration was up by 7%
Small, niche fields, such as property analysts, saw a lift of 92 per cent year-on-year and job ads for residential sales roles increased by 3%. However, this area offered the highest volume of opportunities for the industry.
Adam Burke, associate director at Gough Recruitment says that demand for sales talent remains high in a candidate-short market. “Now more than ever, employers need to provide more training and support to help their teams be successful,” he says. “Bigger brands are doing this and it’s a key part of their attraction.”
Burke adds that in the current real estate climate, more sales professionals are considering new roles.
“Agents aren’t seeing the same volume of stock anymore, so more sales people are looking to property management roles,” he says.
Although residential leasing and property management experienced a 12% decline in opportunities the three-month period of August to October, it continues to have among the highest volume of job ads for the industry on SEEK.
While reports indicate that New Zealand’s property boom has finally come to an end, experts say demand for skills talent in the industry remains a strong focus. As the property market shifts, training and development appears more important than ever.