Despite challenging marketing conditions, the number of estate agents in the UK has risen this year.
Data taken from Companies House shows that between January and this month, October, there was an increase of 547 estate agents – more than offsetting the number going out of business.
Companies House does not publish the names of companies that are dissolved.
This figure can only be found by comparing reports from different months (each report lists roughly 4.2m companies) and comparing them to see who is missing.
This mammoth piece of research has been done by a new company Propdex.co.uk
It has found that 1,646 firms calling themselves ‘estate agents’ have disappeared this year.
It also found that 1,007 are in official trouble, for example in administration or under notice to strike off.
New firms – companies under three years old – are the most likely to have gone under so far this year, but it is notable that 468 much older firms have also folded in the same period.
Is the rise in agent numbers due to start-ups? Not necessarily, says Propdex.co.uk
It found that 2,416 companies calling themselves “estate agents” were incorporated this year, implying that 10% of the total of nearly 22,000 are either complete newcomers, or older firms re-registering to move their tax liabilities around.
There is a graphic showing the current composition of the industry here: https://public.flourish.studio/visualisation/118202/
The research shows that there are currently 21,641 estate agents in the UK, of which 1,007 are in trouble.
In January, the total was 20,087, of which 866 were in trouble.
The numbers also include a regional breakdown. You can download the figures via this link: Companies House (estate agents) regional tab
Propdex.co.uk is a new company.
The main players are Richard Spiegal, who has worked for the last 16 years in the Spanish property market (both independently and for kyero.com), and Matt Powlson, who is an engineer, mathematician, and retired RAF Wing Commander.
Their first public report was only issued last week, using stats from HM Land Registry to show price changes by postcode in England and Wales.
They will continue to produce this monthly, but are also expanding into other types of statistics in the industry. Today, EYE has published this first example.
Comments (10)
We have been responsible for a larger number of signings , but the difference is that our self employed agents retain 90% of any fees they generate. We operate on a % structure with payment on completion , average fee 1.25% , average property price on our books £1.7m our agent win all the way. http://www.agentandhomes.com
And what of the self managed portfolio landlords who move their properties into a limited company at the advice of their accountant, given imminent tax changes, are they now estate agents?
I suspect that they came up with a catchy name related to property, when registering the company it must fit into a specific category, estate agent being the obvious choice, I wonder!
Wow!! Just shows how many are being forced to go as self employed freelancers to avoid the tax. This could be from both online and High Street.
I know a few business who have asked their staff to work on commission only as self employed freelancers. This will continue as the market keeps on tightening.
I met with someone this week who is looking to start up a new estate agency in the coming months and they didn’t know where to start to get instructions, what needs to go in a contract or what a CRM is. People see properties selling quickly and think it is an easy money spinner.
Are PB’s Lexperts classing themselves as Estate Agents I wonder.
Personally I think there will be a rise in personal realtor style agents working from home or serviced offices who provide a high end service, rather than a stack em high sell em cheap approach.
As experienced people flee the failing corporate and regional agents, what are they to do if agency is all they know?
Lower costs base, higher more flexible service offerings at decent fees, is the way forward for agents in my view.
I agree with this, high level personal service is what will win out.
I have worked like this for the last four years.
With respect, that’s the angle my agency has take for the last 7 years and we are very successful, covering a very small area with low fees from competitors. We have a large double fronted office and employ just three staff. Highly personal, quality service with attention paid to every single person who makes contact. It’s not a hard business to get right….but it’s a very easy business to get drastically wrong, hence why we as agents generally have a bad name or seen as a necessary evil
A mid way between High Street Estate Agency, but with some of the cost savings passed on to customers. (purple bricks style).
I am starting to think that if an established brand or individuals, working from home or first floor offices, might actually work now. Courtesty of purple bricks.
If one thing is certain, it is that people don’t need you to have an office to instruct you; but you do need a quality offering. PB will never be able to lift their offer price as they now have the cheap fee reputation; and bridging the gap in funding between going from an upfront model to a pay at the end model would bankrupt them.
As someone who started and ran the business from industrial offices, we found that for rentals it didn’t make much difference and we grew quickly. Sales on the other hand was another matter. We were constantly overlooked at valuations due to the other agent being on the high street where they can be seen (trusted).
Since moving to high street premises this stigma has gone away and instructions have increased.
We have also noticed that people like to see your face around town, they want to know who you are, and that they can call in to see you instead of waiting to catch you on the phone.
Our lettings book has increased too, partly due to landlords being sold out to new agents and having nowhere else to go. Now they do, and they’re coming!
That said, we understand that one size doesn’t fit all, some will always prefer online, other’s traditional, and a few in between. I just wouldn’t risk setting my sights solely on the few in between.