Real estate agent Michael Boulgaris fears a dog-eat-dog sector. Photo / Dean Purcell
Real estate agent Michael Boulgaris fears a dog-eat-dog sector. Photo / Dean Purcell
Cash-starved New Zealand real estate agencies got $6 million-plus in wage support to continue during the lockdown, estimated to see around $3 billion of sales vanish in the month of alert level 4.
According to Work and Income's database of businesses and employers receiving the subsidy:
• Barfoot & Thompsonreceived the most - $4m for 603 staff; • Colliers International New Zealand got $923,000 for 133 staff; • Bayleys Property Services' 49 staff got $338,000; • Bayleys Valuations' 36 staff got $253,000; • Harcourts Group's 31 staff got $217,000; • Harcourts International's 28 staff got $196,000; • Bayleys' Realty Group's 26 staff got $179,000; • Megan Jaffe Real Estate got $126,000 for 18 employees; • Colliers International (Wellington) got $102,000 for 15 staff; • Ray White (Real Estate) got $91,000 for 13 staff; • Boulgaris Ltd got $25,000 for four staff; • Graham Wall Real Estate got $21,000 for three staff.
Property entities which represent those in the sector also got subsidies: • Real Estate Institute of New Zealand got $168,000 for 24 staff; • The Property Council of NZ got $112,000 for 16 staff; • The Property Institute of NZ got $56,000 for eight staff.
Further real estate agencies possibly got millions more because the companies they operate usually don't carry any major agency name in the title.
No list of companies receiving the money has been released but the Government website is searchable by company title only. And then it only gives the first five results.
The wage subsidy scheme is available to businesses suffering a 30 per cent drop in revenue due to Covid-19, and that will retain named employees for at least 12 weeks and pay them at least 80 per cent of their normal income where possible.
Michael Boulgaris, a Remuera-headquartered agent, is worried about the lockdown's effects on new agents.
"They will not know what has hit them," he said of a predicted downturn in the sector and a massive sales drop. "I wonder how the in-house training will help them to keep their chin up during the challenging times ahead. This may bring back a dog eat dog market amongst agents, I really hope not."
A spokesman for Bayleys confirmed the amounts recorded were correct. No response was received from an inquiry to Barfoot & Thompson or Graham Wall, who sold New Zealand's most expensive house for $39m in 2013.
Megan Jaffe, who runs the Remuera-based Ray White agency, said the $126,000 from the Government was crucial to her business, giving certainty during tough times.
Megan Jaffe said the state subsidy was important. Photo / Doug Sherring
"We have not reduced sales people's hours as most other agencies have done," Jaffe said, citing a company directive for franchisees to cut back to four days a week.
"We did not do that, despite our current sales being less than 5 per cent of what they were previously. We are all in this together, hopefully not for too much longer," Jaffe said.
Boulgaris said he has five salaried employees but had only claimed for four, thus taking less money than he was entitled to.
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He had not made any of staff redundant but was paying their full wages, he said.
During the global financial crisis, he said he rented his town home for 12 months for $2000/week and rented a house in Pokeno for $150/week to continue paying staff wages "while everyone else around me either went under or fired their staff. People that are like me, small business owners that still pay their mortgage and support charities, are entitled to the Government assistance, but I have had a quick look myself at a glance."
