Downturn could be damaging to estate agents

Permalink: Downturn could be damaging to estate agents
by Kay Murchie

Jonathan Haward, managing director of the County Homesearch Company, believes that only the best estate agents will weather the current downturn in the UK property market.

Mr Haward said 85% of people search for a new home online so the need for an estate agent on the high street is diminishing.

Together with the current slowdown in the market, a tipping point has been reached and those with offices will be forced to close their doors and are unlikely to ever reopen them again, added Mr Haward.

Mr Haward is forecasting that the number of estate agent offices in 5 years time will be half of what it is currently.

However, Mr Haward did explain that there will always be those clients who prefer to call into a branch and agents who place an emphasis on excellent customer service and are really in touch with the local market and those who adhere strictly to industry regulations will be the only survivors.

The news comes just one week after business monitor company, Debtwire, said estate agencies are closing due to the housing slowdown and the number of agencies has dropped from 13,000 to 12,000 already this year.

Furthermore, Movewithus, the biggest network of independent estate agencies, said of the estimated 12,000 agents, at least 4,000 will close by next year.

The UK’s largest estate agency group, Countrywide, which incorporates Bairstow Eves, Gascoigne-Pees and RA Bennett & Partners, has closed 50 branches so far this year and is planning more cost-cutting.

Research from PropertyFinder.com has established that confidence in the future among estate agents fell last month with just 42% of estate agents were confident in the future last month than they were in March, this is down from 51% the previous month.

Nicholas Leeming of PropertyFinder said the April agents’ confidence index shows confidence is still falling. What we are seeing is agents reacting to the negativity surrounding the property market currently, he added.

However, Mr Leeming hopes to see improvements over the summer months as the Bank of England’s initiatives help to improve the availability of mortgages.