REAL shadow of former self

By IRENE CHAPPLE

The reincarnation of lawyer and real estate venture REAL is a poor cousin of the original that promoted itself through a glamorous television marriage of lawyers and agents.

It does not talk market share or brand advertise.

The public demise of the nationwide REAL this year, after a $1.3 million pre-launch advertising campaign, was blamed on a slow market and cheap commission rates.

However, Auckland lawyer Don Thomas said the concept had proved itself.

He said the biggest carrot from the new REAL was still the all-round cheaper deal.

There was a rebate on legal costs, of around $600, and, with a commission rate of 3.5 per cent, vendors could save $1000 to $1200 on a $180,000-$200,000 sale, he said.

The commission rate, on top of a base fee of $400, had increased from the original 2.95 per cent, but remained slightly less than the average real estate agent's fee of around 4 per cent after the base fee, said Mr Thomas.

Mr Thomas said the original REAL was too grandiose.

He pushes the new, downbeat version as a "continuance" of the original REAL - despite the company, REAL Management, going into receivership early this year.

The new group, fractured into five regional representatives holding equal shares in shell company Real Brandz NZ, bought assets of REAL from the receivers.

Ian Reeves, of the Whangarei arm, said "peanuts" was paid for the brand name, but the group took over five offices nationally - from REAL's one-time high of 29 branches - buying assets and rental obligations. It now has a sixth office in Auckland.

Mr Thomas said the Auckland group had 400 "interested" law-firms on its mailing list.

"They are the original supporters, but for various reasons did not want to become owners of it and didn't want to spend more money," he said.

Former lawyer Warwick Brown, co-ordinator of the original idea and REAL Management's chief executive, still supported the idea.

"I did spend two and half years on it so I am slightly annoyed it folded - but it is a sound concept."

He said the colourful advertising campaign first time around was justified in such a cut-throat industry.

But John Waymouth, a specialist in real estate law and practice, scoffs at the claim of 400 interested firms.

"I'd take that with very optimistic scepticism," he said. "They would be lucky if there were half a dozen interested firms."

The new scheme was a continuation of the original misguided idea, he said.

"It is just resurrecting the dead bones of an ill-conceived venture. For the same reasons it will fail.

"These lawyers have lost their focus and objectivity. They cannot give independent legal advice to their clients."

REAL was originally introduced to offset effects of a new regulatory regime being pushed by Justice Minister Phil Goff.

Mr Goff wants to sweep aside the legal and real estate sector's respective monopolies on conveyancing and property sales.

The proposal is being drafted into a Legal Professions Bill.