Property agents may get a major shake-up, as their numbers are likely to drop by as much as 25 percent when the new rules to regulate real estate agents start later this year.
Those agents who fail to meet the new standards will likely leave the industry, and several market watchers said that smaller property agencies in Singapore may also consolidate.
At present, there are over 20,000 property agents in the country. But the numbers are expected to fall between 10 percent and 25 percent when the government sets up the Council of Estate Agencies to regulate them, according to some market players.
While agencies are concerned about compliance and recruitment expenses, home buyers will soon have greater peace of mind, as the upcoming regulations raises professional standards and accountability, and weed out rascal agents.
Property agencies are expected to come up with systems for handling complaints and settling disputes under the new regulations.
“For bigger companies, most of these systems are in place, so there’s minimum add-on cost, but for the smaller companies, they would probably have difficulty doing all this,” said Mr. Eugene Lim, associate director of ERA Asia-Pacific. In the future, "most of them may come together to combine resources," he added.
Many smaller agencies may also collaborate with bigger players. For instance, PropNex has consolidated over 10 companies under its wing over the past five years.
Staff from these firms could either become branch directors or district directors, depending on their experience.
According to the Institute of Estate Agents, more than 90 percent of the 1,700 licensed agencies in the country have less than 100 agents or are not operational, including those who are issued agency licenses but have decided to work for another property company or another industry.
For the meantime, Dennis Wee Group (DWG) is refining its training programmes and may consider increasing fees. An agent is currently paying around $700 for 44 hours of basic training at DWG.
Mr. Chris Koh, director at Dennis Wee Group, said: “We are exploring how to create a modular training (programme) for these new agents so that when they come in, one module will be for them to prepare for their exams, another module possibly some sales techniques on how to sell real estate.”