Industry challenges estate agency closure figures

A number of leading industry pundits have called into question the credibility of a recent claim that 150 estate agents are being forced to close each week.

Debtwire, the Financial Times Group-owned company, which provides news and data to the fixed income markets, last week reported that there are between 12,000 and 14,000 estate agency branches in the UK and of those, it claims that around 1,000 had closed since the start of the year, which works out at around 150 branches a week.

The firm claims the data was revealed by Countrywide’s management during the agency group’s quarterly results conference call with investors on April 30. But a source close to Countrywide says the data is not the group’s own.

They say: “The group has been told [about the numbers] by one of its industry sources; how could it [Countrywide] possibly know that?” The source close to the group adds: “Countrywide wanted to reassure people, by putting these figures into the context of the overall market.”

But Peter Bolton King, chief executive of t he National Association of Estate Agents says: “The problems in the housing market are being caused by two things: the credit crunch and low consumer confidence, caused by people reading this sort of coverage.”

Richard Rawlings, principal of industry consultancy, Estate Agency Insight, adds: “Lots of my more progressive clients are suffering, so if they’re suffering, weaker agents are no doubt in a worse position. “I think 150 closures a week is probably a little bit embellished, but it wouldn’t surprise me if a lot [of agencies] are going to the wall.” Separately, Debtwire claims that Countrywide also revealed during the conference call that it aims to increase fees and will target around 1.65% next year.

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