In a year when most of South Africa’s large real estate groups experienced an encouraging improvement in the residential property market, Harcourts has turned in a particularly notable performance, with the total value of sales in the group having shown a year-on-year increase of 29% at end-November.
According to property data company Lightstone, the estate agency industry as a whole achieved an 18% year-on-year increase in the value of sales, with 8% accounted for by higher homes prices and the remainder being due to a higher number of units sold.
“Harcourts results this year are thus well above-average,” says CEO Richard Gray. “Our average sale price increase across the group was 6,1%, so the bulk of our 29% turnover increase obviously came from a huge increase in the number of homes sold.”
Industry-wide, he says, the primary reason for more homes being sold in the past 12 months was an improvement in lending conditions and an increase in the banks’ appetite for mortgage loans. “In addition there is strong and growing demand now in the middle segment of the market, as evidenced by the stock shortages that are beginning to emerge in many popular areas.”
However in Harcourts’ case, says Gray, the trend was strengthened by the addition of 12 new offices to the group’s national network this year, as well as significant growth in agent numbers. “Agents are being attracted to Harcourts by our leading-edge technology offering, the Harcourts Training Academy and the fresh brand. The group is also attracting younger agents than the industry average for these reasons.”
And finally, he says, Harcourts has grown its market share in many of the areas in which it operates during the past 12 months, thanks to its leadership coaching and training, which is creating a strong group of business owners and principals with the knowhow and motivation to expand their businesses.
Currently the average selling price being achieved by Harcourts agents is R960 000, compared to an industry average of around R900 000. The group says the greatest demand it is experiencing is for homes in the R700 000 to R2m price range, which have accounted for 80% of total sales value in the past 12 months.