Many more property agents could quit the industry - or be forced to leave - in light of the current market downturn, say industry players.
‘The market was very bullish in the last two years, so the barriers to entry were not there for a lot of agents,’ said Cushman & Wakefield managing director Donald Han. ‘Now that the market is tightening, property companies want to look for the performers, and let the rest go.’
On Wednesday, PropNex Realty said that it was firing more than one-third of its agents. About 2,800 agents who have been with the firm for over a year but have yet to record a single transaction will be terminated, PropNex said.
Industry players told BT that during the property upturn in the last two years, a number of ‘non-typical’ agents entered the industry in order to make a quick buck. One property analyst told BT that at the height of the property boom, he had ‘civil servants, clerical staff and others with regular day jobs’ looking to join his firm to ‘make some extra cash’.
‘There were a lot of fly-by-night agents - people who didn’t know the rules,’ he said.
But with the current property slowdown, many of these agents have been unable to close deals and therefore have left the industry, market players said. More could follow, they added.
PropNex said that many of its inactive associates may no longer be familiar with current market trends or the latest policies. ‘If that is the case, then they would hardly be able to best serve the customers’ interests,’ said chief executive Mohd Ismail.
The agents were first given a choice to remain with PropNex by signing up for Professional Indemnity Insurance and a refresher course.
Observers called PropNex’s move ‘bold’ and even ‘drastic’. The industry here is largely unregulated and there is sometimes confusion over agents’ qualifications and accreditation.
Industry veterans, however, pointed out that some of the agents fired by PropNex could be registered with multiple agencies and so could have recorded transactions for other firms instead. There is also nothing preventing fired agents from joining another agency, they added.
What the industry needs is more education, said Ku Swee Yong, director of marketing and business development at Savills Singapore. ‘If they (the fired agents) are serious about the industry, they should take advantage of the now relatively stable market to upgrade themselves and deepen their knowledge,’ he said.
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