Giving property buyers a hand
VISIONARY developers in the Midlands have launched a concept that will save house buyers money, but could well dent the earnings of local estate agents. The concept allows developers flexibility in their pricing structure and the company, Midlands Developers Direct, will allow potential new homeowners to liaise with and buy directly from the developers.
Formed by Tom Eastwick (Eastwick Brothers Construction) who is developing 10 houses at The Gates estate outside Hilton College, and Janet Channing, owner of JC Properties, which develops in Hilton and Howick, the company anticipates attracting a number of other Midlands developers.
“Agents earn quite a lot in commission,” said Eastwick. “For example, I have budgeted around R1.4 million to various agents this year. Of these 10 stands here at The Gates, their commission will be more than R3m.
“This new marketing platform is not an estate agency, it’s an initiative where other developers can come on board, pay a one-off fee and thereafter a monthly subscription. People looking to purchase in the area can go straight to this portal and pay a lower price for their homes, compared with buying through regular estate agents.”
Estate agents, he added, can still sell the properties listed on their portal, “but they must then add their commission to the Midlands Developers Direct selling price”.
“We will never put estate agents out of business, but because all developers have transferring attorneys, we can do the brokering ourselves.”
The join-up fee for developers includes all property listings on the website, professional photos of the subject properties and the development. The ongoing monthly subscription promotes the website through other social media including Facebook, LinkedIn and Instagram. The website aims to empower readers by publishing newsworthy articles about the property sector.
“The way the market is now, I believe if you’re a forward thinking home buyer or developer, this is the way to go,” said Eastwick.
Although the website has only been live for a couple of weeks, he said that already it was gaining traction and other local developers had approached Midlands Developers Direct to join the platform. “The more value we have on the website, the more motivated people will be to use it regularly. It won’t just focus on high-end homes, but will extend right across the full pricing spectrum.”
Midlands Developers Direct’s site isn’t just a marketing tool aimed at home buyers.
“Through this platform we can network with each other, pass on referrals and establish it as a community platform in a way. We have regular informative columns and aim to promote and highlight interesting events in the area like the Comrades Marathon and the Karkloof Challenge, for example.”
As far as he and Channing are aware, no other company like this has yet been established in South Africa.
“There is one in Singapore, but we haven’t heard of anyone in this country doing it. The benefits are obvious: as a developer, I may now market my house without adding the agent’s commission on top and this benefit is passed on to the purchaser.
“Yes, there’s the pain of paying the start-up costs and there’s also the monthly subscription. Overall, the Midlands Developers Direct platform enables developers to engage directly with their prospective purchasers and show them the design features which make each property unique.
“In today’s world, we must be conscious of cutting costs and presenting the most attractive deal. Technology has allowed Midlands Developers Direct to bypass the middle man, the estate agents, and engage directly with the purchaser. It’s a win-win for all parties.”
An added plus was home buyers would have the assurance of knowing any property on the website would have been peer reviewed.
“There will be no dodgy builders or developments. Of that you can be sure.”