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More property agents, agencies exit industry

SINGAPORE — The number of licensed property agencies and registered agents in Singapore has dropped to its lowest since 2011, highlighting persistent weakness in an industry that is also increasingly facing disruption from new platforms designed to cut out the middleman.

Data from CEA showed that as of Jan 1, there were 28,397 registered property agents in Singapore, down about 3 per cent from 29,262 agents the previous year. TODAY file photo

Data from CEA showed that as of Jan 1, there were 28,397 registered property agents in Singapore, down about 3 per cent from 29,262 agents the previous year. TODAY file photo

SINGAPORE — The number of licensed property agencies and registered agents in Singapore has dropped to its lowest since 2011, highlighting persistent weakness in an industry that is also increasingly facing disruption from new platforms designed to cut out the middleman.

Data by the Council for Estate Agencies (CEA) yesterday showed that as of Jan 1, there were 28,397 registered agents in Singapore, down about 3 per cent from 29,262 agents the previous year. The number of licensed agencies also fell to 1,286, down 6 per cent from 1,369 the previous year. Both the number of agents as well as agencies are at their lowest since the CEA began collating the data in 2011.

“The reduction in the number of registered agents could point to a slight consolidation of the industry given the current property market sentiments,” said Mr Heng Whoo Kiat, director of Policy & Licensing at CEA. “The real estate agency industry landscape is evolving. For example, with technological innovations, consumers’ lifestyles and preferences in handling their property transactions are changing, and this could shift demand for real estate agency services.”

Property agents and agencies are also exiting the industry faster than they join it. A total of 95 agency licences and 3,200 agent registrations lapsed at the turn of the year. In comparison, the CEA issued 40 agency licences and 1,189 agent registrations throughout 2016. Multiple cooling measures and loan curbs since 2009 have hit Singapore’s housing market, although the lower prices have nudged volumes up in recent years.

Data for both the public and private markets show that 2016 transactions are on track to overtake 2015 volumes.

Data from the Urban Redevelopment Authority (URA) show that 11,993 private homes were sold in the primary and secondary markets in the first nine months of last year.

While the figure is not far off from the 14,117 units transacted in the whole of 2015, it is far shy of the nearly 38,000 units sold in 2012 before the Total Debt Servicing Ratio (TDSR) framework was implemented.

In the public housing market, resale transactions totalled 15,801 in the first nine months of last year, Housing and Development Board (HDB) figures show. For the whole of 2015, a total of 19,306 HDB units were resold, up from 17,318 units the previous year.

“Though the volume of property transactions in 2016 has increased over 2015, the overall number is still low compared to the peak. Agents leave the industry because there are a lot fewer transactions now,” said Mr Eugene Lim, key executive officer of ERA Realty Network.

“Agencies that are small outfits bear the brunt of slower transactions as they may have problem covering overheads with the decreased revenue. We have seen small companies close down and the entire team cross over to join large companies like ours,” he added.

In addition to the weaker property climate, the industry also has to contend with new mobile apps such as OhMyHome that easily allow sellers and buyers as well as landlords and tenants to transact directly with one another without going through an agent.

“This is an area of concern that the industry is watching closely,” said Mr Lim, adding that ERA has invested heavily in technology and apps to increase its agents’ productivity.

Ms Tracey Wong, CEO of Institute of Estate Agents (IEA), an industry association, said: “Estate agents should embrace change, make the best of technology and not look at it as disruptive, but take full advantage of technology to be an added useful tool to further enhance services. There is no stopping technology from evolving. We should see how we can make better use of it to our advantage rather than to compete against it.”

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