Estate agents facing the future as an endangered species

Published on Monday 19 May 2008 22:14

SCOTLAND is set to experience a decline in the number of property-dependent solicitors firms and estate agents following the slowdown in house sales, industry insiders have warned.

The admission that business north of the Border will suffer follows a gloomy prediction of the effect of the housing market slump elsewhere in the UK.

According to Jonathan Haward, of the County Homesearch Company, up to half of all estate agents in the UK will disappear within five years.

And Movewithus, the biggest network of independent estate agencies, has estimated that at least a third of the UK's 12,000 agents will close by the end of this year.

Yesterday, the Edinburgh Solicitors Property Centre admitted that some of its own 230 members could be hit.

"A combination of market forces and the increasing importance of online advertising mean we are likely to see some consolidation over the medium term which may result in a slight reduction in the number of agents," said ESPC chief executive Ron Smith.

However, the decline would not mirror the wider UK trend, Smith added. "While the prominence of the internet in property marketing will continue to rise in coming years, it is unlikely that we will see such a marked reduction in the number of estate agents in Scotland," he said.

Most solicitors who work in property are protected from the downturn by offering a diverse range of other services, claimed Mark Hordern, spokesman for the Glasgow Solicitors Property Centre,

Hordern said the newer estate agents, including franchises, would be hit hardest due to a lack of financial strength and experience.

But Jonathan Farley, director of Farmore IT, owner of scottishproperty.net, said all agents faced a growing threat from property websites. "Estate agents themselves are having to advertise on property websites because their large base of customers has been eroded," said Farley. "The market is definitely getting harder and more cut-throat for estate agents, as people know most properties are now online and so are bypassing agents."

The Scottish property market is particularly suited to online property searching, Farley suggested. "We have more rural areas that are traditionally served by small independent estate agents and if you can save yourself a long drive by doing your search online you will do it."

The gloomy outlook for the sector came just weeks after Edinburgh-based estate agents Stewart Saunders fell victim to the housing market slump.

But Matthew Gray, property services director at Pagan Osborne in Edinburgh, said the better agents would survive. "Estate agents with genuine expertise and experience will continue to play a very valuable role. Due to a shortage of housing UK-wide, this is a market place that demands expertise, especially now. The best will adapt and prove their worth, with the survivors growing in size."