Interrogate market share stats, says PGP
In the fiercely competitive real estate industry, many agencies make claims to market share which are frequently confusing and even contradictory when read by the average consumer. Pam Golding Properties’ MD for the Western Cape metro region, Laurie Wener, cautions that consumers must interrogate such claims very thoroughly, before accepting them as fact.
“The fact is that when it comes to assessing market share, the only comprehensive and reliable source of information is the information released by the Deeds Offices, and compiled in the SAPTG (South African Property Transfer Guide),” says Wener. “This information is available electronically by subscription, and includes the address of each property sold, the names of both seller and buyer, the date of sale, the date of transfer and the sale price. There is quite simply no other accurate source of such property information, and any claim to market share based on any other source, is of questionable accuracy and validity.”
The problem is that the reporting of property transfers by the SAPTG is frequently delayed – by anything from five months to a full year after the date of conclusion of the sale. On average, it takes around three months from the finalisation of a sale (with all suspensive conditions having been met) to the actual transfer of the property. This may vary from one Deeds Office to another, based on a number of variables. After transfer has taken place, it still takes another month or two for the transaction to reflect in the SAPTG records. This means that an agency can only calculate its own market share with any level of accuracy, from about five months in arrears.
“This lag may be a source of frustration for some agencies,” says Wener, “but the fact remains that there is no other reliable and complete source of information on transfers. And the bottom line is that there is no way of claiming market share accurately, based on sales prior to actual transfer. Certainly, there are other services which record and report on sales on a monthly basis, prior to transfer – but these rely on optional submission and subscription by the real estate companies, and are by no means comprehensive. There is also no quality control to ensure the accuracy of the finalised sales submitted by the agencies. So whilst it is attractive to be offered information that is fresh – sometimes only one month old – in reality you aren’t getting an accurate or complete picture of market share. It is at any time quite simply impossible for an agency to assess its own position in the market relative to the opposition, as there is no method of identification of sales other than one’s own.”
In conclusion, Wener says, consumers would do well to assess the source of any claims to market share made by any agency. “Before accepting such claims, one needs to look at the source of the information as well as the time period being represented, and the unit of measurement – for example, is the agency referring to the number of units sold, or total sales value? It goes without saying that claims based on a selective reporting service or those encompassing only short periods of assessment, may well be highly volatile, and not truly reflective of general trends.”
For more information, contact Laurie Wener on 021 673 4200 or laurie.wener@pamgolding.co.za
