In Gujarat, CAs and engineers sign up as property dealers

The real estate broking industry seems to be in a makeover in Gujarat. The real estate player RE/Max has a rising number of white collar professionals, including chartered accountants, lawyers, and engineers, besides top officials of private companies, becoming its franchisee 'property dealers'.

The firm has seen a surge in enrolment for franchisees from the unexpected segment of professionals. The reason, it says, is of course handsome money from the brokerage. Also, the franchisee offers them the freedom of doing business at their convenience.

"There is a growing interest from highly educated and professional individuals to get into property dealership. There is a need for such people, especially for luxury property deals. This provides them a good opportunity to make productive use of their network resources and extra time," Manan Choksi, regional director, RE/Max - Gujarat told BusinessLine .

Present in over 130 countries, RE/Max has about 220 agents in India, half of whom are in Gujarat.

"Gujarat is a best performing market for us. Legal procedures such as property transfers are conducive and much faster. Secondly, people have entrepreneurial ambitions to take up such work," he said, adding that big builders and property dealers too want such sophisticated people to sell their high-end properties. "At times traditional brokers were found to be suppressing prices to get their brokerage, which eventually affected the overall market sentiment," said Choksi.

Sharing one of the success stories, Choksi recalls a senior employee of a noted textile firm in Ahmedabad, who within one-two years of becoming their associate was earning Rs 1 crore annually from the brokerage. "..That is all white income!" he said. The broker margin ranges between 1 and 1.5 per cent of the deal value.

In Gujarat, RE/Max has seen a 20-25 per cent growth in turnover from Rs 800 crore in FY 2013-14 to Rs 1,000 crore in fiscal 2014-15. "We expect to appoint about 500 agents and have 50 offices in Gujarat in the next three years," said Choksi.

RE/Max has professionals ranging from mobile shop owners to retired cricketers, regional manager of a corporate group, and self-employed professionals, with an average age of 35 years.

The selection and training for such property dealers is the key. New dealers are given extensive one-week training about RE/Max technology and the market.

After that the franchisee is able to use the RE/Max network, technology, and brand for a monthly franchise fee in the range of Rs 3,000 to Rs 10,000, which is based on the commission-sharing agreement. The commission-sharing ranges from 50 to 100 per cent in favour of the franchisee.

Meanwhile, Choksi said about 20 per cent of the properties built in 2013 were still unoccupied in Ahmedabad. "Builders do not want to reduce the price. This model helps in bringing the right client for the right property at the right price," said Choksi.