Less than half of estate agents report revenue rise in 2011, with NSW agents best placed: Macquarie survey
Less than half of the 416 estate agencies polled by Macquarie Group reported an increase in revenue in 2011, according to the investment bank’s recently realeased 2012 residential real estate benchmarking report.
Nationally, 47% of agencies reported an overall increase in revenue compared to the previous year.
Two out of every five estate agencies (40%) reported a decrease in revenue, with 13% saying revenue did not change.
"The Australian residential property market in 2012 is an increasingly challenging landscape for real estate agencies to navigate," says Shaun Bassett, national head of residential real estate at Macquarie Relationship Banking.
Bassett says estate agents must have the ability to "adapt quickly and be sufficiently robust to survive, and thrive, in an environment where they are increasingly affected by factors outside their control".
"The focus therefore has to be on factors that are controllable – elements within and outside of the businesses that principals, owners and managers alike can exert influence over – to better place themselves to generate a return irrespective of what is happening in the broader environment," he says.
The 2012 report found that many estate agents are turning to property management as a way to diversify their income.
It also found some disparity by states when it comes to revenue growth, most notably between NSW and the rest of the country.
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A comparatively high 57% of NSW agencies are experiencing an increase in revenue, with Macquarie attributing this to sales revenue growth, with the survey also finding that 44% of NSW agencies versus 32% nationally reported an increase in sales commissions over the same period.
In no other state did a majority of agencies report an increase in revenue over 2011.
Victoria and Queensland both reported the highest percentage (46%) of agencies reporting decreasing revenue.
For those agencies that did report revenue increases over 2011, more than three quarters cited property management as a key area contributing to growth.
Around 60% attributed their revenue increase to rising sales revenue with 39% of respondents identified both.
“This tells a compelling story about the value of property management as a very real driver of revenue and business growth,” says Macquarie.
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