Agent numbers fall as property market stagnates
The number of active real estate agents fell by 235 between March and June, according to figures from the Real Estate Authority.
Infometrics chief forecaster Gareth Kiernan said agent numbers had historically responded quickly to changes in market conditions, and with sale volumes and prices tumbling, he expected more to leave the sector over the next 12 to 18 months.
Real Estate Authority figures released under the Official Information Act stated at the end of March there were 17,101 active agents.
Three months later there were only 16,866 – a figure that was still well above pre-pandemic levels, when there were just over 15,000.
‘‘It’s interesting to note that active agent numbers in July are lower than earlier in the year, which suggests the drop in sales is already seeing some people leave the industry,’’ Kiernan said.
He said the last time there had been a similar situation with a big increase in agent numbers heading into a downturn was probably in the mid2000s – just before the global financial crisis.
‘‘Unfortunately we don’t have data on the number of agents back then to compare,’’ he said.
‘‘However, it means that the relatively big increase in agent numbers during 2020 and 2021 is unsustainable, and there need to be further declines in agent numbers.’’
Bec Whitley became a real estate agent about a year ago and was not surprised people were dropping out of the industry. She said reduction in sales was probably the driver.
‘‘On the North Shore, where I am based, at the moment we are seeing approximately 200 to 230 properties selling per month, usually we would be seeing around 450,’’ she said.
‘‘When I first started it was superhot, non-stop, really, really busy, selling things left, right and centre, and now that is not the case at all.
‘‘It is very quiet, it is much harder to get listings, and properties are taking much longer to sell.’’
But with more requests for appraisals coming in, Whitley expected some recovery in the market during spring and summer.
Drawing on Real Estate Institute data, Kiernan said the number of house sales in June was down 31% compared to the equivalent month the year before, dropping from 22,973 to 15,689, which followed a general trend of falling sales since the start of the year.
The average sale value of properties had also been in decline. Kiernan said prices had fallen just over $90,000 between December and June to settle at just over $1 million. This was still above the price properties were getting in June 2021.
The fall in the number of sales meant the total value of all sales was down from more than $22.5 billion to $15.7b between June 2021 and June 2022.
The Real Estate Authority issues real estate licences on an annual basis.
Chief executive Belinda Moffat said that when the authority was formed in 2009 all existing agents were issued with an annual licence on March 31, and approximately 40% of the licensees still had that renewal date.
She said the effect of this bulk renewal date was that the industry tended to see a drop in active agents after March 31.
‘‘A licensee who decides to retire or leave the industry is more likely to let their licence lapse on its annual renewal date than actively surrender it,’’ she said.
‘‘Anyone looking to interpret a short-term shift in licensee numbers over a period which includes March 31 should take care to factor this context into their analysis.’’
Moffat said the industry had seen a strong increase in applications during the hot markets of 2020 and 2021.
The authority’s most recent published licensing data shows there were 16,846 active licensees registered with it at the end of July – 20 fewer than in June.
Andrew Harley is also about a year in as a realtor, and said it was inevitable the workforce would shrink as things got tougher.
‘‘Real estate is a very competitive industry where we are paid solely on commission so that can result in fluctuating incomes,’’ he said.
‘‘If there’s an agent who has earned very little or nothing in the last three to six months, that’s going to be even harder on them.’’
Harley said if vendors were realistic about the price they wanted for their property they would be able to sell.
Neither Whitley nor Harley have any plans to leave the industry.
Bec Whitley Real estate agent
‘‘It is very quiet, it is much harder to get listings, and properties are taking much longer to sell.’’