Real estate agents slump

Photo / Brett Phibbs

A shake-up in the real estate industry has caused more than 1400 agent licences to be suspended or cancelled.

Although a number of factors contributed to the decline, the sluggish property market and a higher registration cost for agents are primarily to blame.

Since the establishment of the Real Estates Agents Authority on November 1 last year, 1333 have suspended their licences and 73 have cancelled - out of a total of 17,078. A flat-fee of $555.75 is needed to re-license.

Barfoot and Thompson managing director Peter Thompson said the market was tough for sales people under contract - unless they sold, they didn't make any money.

"There's definitely been an attrition through the industry, primarily through market conditions. It's very hard," said Thompson.

He said although the top sales people were still making good money, some in the "middle row" were having to bolster their incomes with night jobs such as driving taxis.

With a six-week course now required for a licence, a lot of those who may have registered would not be as keen to apply for a licence.

"It's a lot tougher to get into the industry now, which is not necessarily a bad thing."

Harcourts chief executive Hayden Duncan said the main reason behind the decline of numbers was the cost. "The changes in the act created a significant cost for people to renew their licence."

He said part-timers and those not currently practicing were the ones who were not re-registering.

But he also said the tough times had scared off those in for a quick buck: "The real reality is the real estate industry has taken a 50 per cent pay cut in the last five years.

"There's no question that the market is not particularly buoyant. There's no question that real estate sales people have had to tighten their belts and are not making as much money."

Duncan blamed the higher fee on a large number of "frivolous" complaints to the Real Estates Agents Authority.

An authority spokesman said since November last year there had been 693 complaints, with 11 of these upheld.

He said because the licensing structure had moved to a flat fee from a tiered structure it was hard to compare the two.