More real estate agents than homes for sale in New Zealand
Realtors have no excuse for not spending time with their clients – New Zealand now has more agents than houses for sale.
A total of 15,503 agents and 909 companies have active real estate licenses, approximately 1,200 more than a year ago. A record number of people have applied to join the industry over the past year, according to the Realtors Authority.
At the same time, the growing enrollment shortage has been compounded by the Covid lockdown.
At the start of this month, there were 12,250 homes on the market, a third less than last year, according to the Real Estate Institute (REINZ).
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Stephen Lee, a real estate agent at The Professionals, said agents were competing for listings and some were cutting commissions.
“There are probably too many real estate agents on the market now. People are going to fall because they cannot survive in this market.
Lee said there were typically 20 to 30 listings in his area of Wellington’s Eastbourne and Hutt wards, there were now only eight listings among nine agents.
“I think the young agents will struggle because they don’t have the reputation yet. Some of the established agents are getting more and more listings.
Lee said some agents are now accepting commissions below 2%.
According to Lee, most agents made less than $ 100,000 a year and only a few made a lot of money. He described the job as hard work, with irregular hours and many rules to follow.
The increase in the number of licenses has been attributed to the overheated real estate market and rapidly rising prices.
The Quotable Value appraisal agency reports that the average New Zealand home value rose 26% last year. About 100,000 residential properties with a total value of just over $ 90 billion changed hands in the year to June, up from $ 53 billion for the year at the end of 2019.
The latest revenue figures from the Department of Enterprise, Innovation and Employment show agents earned an average of $ 84,500 in 2019.
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Craig Pray of Ray White, who has been selling real estate in Christchurch for 38 years, said that like any business, those who work the hardest do better.
“You have to be proactive. Business doesn’t come to you – you have to be there to chase people away, ”he said.
“Maybe some agents get caught a bit, thinking it’s going to be easy. It’s never easy, you have to go out and sell. People trust us with their greatest asset.
Pray said an increase in requests for recent assessments suggested the listings would resume in the spring and summer.
Jen Baird, CEO of REINZ, said while the lower inventory level was no surprise due to the foreclosure, the drop was more than expected.
“This is the lowest level of inventory we have ever seen in New Zealand,” she said in REINZ’s latest report.
The realestate.co.nz listing website registered the lowest number of properties on the market in August since launching 14 years ago.
Website spokesperson Vanessa Williams said the trend has been going on for several months.
She said it could be caused in part by a self-fulfilling prophecy.
“There are many factors at play in our stock shortage, but with several reports of sellers unable to find a new home to live in, it’s no wonder some have been reluctant to put their home up for sale.
“It helps reduce inventory – it becomes a bit of a cycle. “
Real estate commissions range from 2.5% to 3.95% of the first $ 400,000 of a sale price, and 2 to 2.5% of the price above, with marketing and auction fees sometimes in addition.
Average prices in major cities in August were $ 1.36 million in Auckland, $ 1.03 million in Wellington, $ 676,000 in Christchurch and $ 685,000 in Dunedin, according to Quotable Value.
Among New Zealand real estate agents, Auckland has the most with 6,969, followed by Canterbury and the West Coast with 1,831.
According to realestate.co.nz, the biggest drops in registrations since last year were in Coromandel (64%), the West Coast (52%), Nelson (50%) and Canterbury (49% ).