Channelnewsasia.com | Posted: 08 March 2013 2052 hrs
SINGAPORE : Despite the red hot property market last year, the total number of real estate agents in Singapore grew by just 1.5 percent in the 12-month period from 1 Jan 2012.
According to the Council for Estate Agencies (CEA), the number of registered agents in Singapore grew to 31,040 as at 1 January 2013, up from 30,577 on 1 Jan 2012.
Previously, industry players say it's not unusual to see agents headcount grow by 20 percent in a good year.
While there were more new entrants last year, the increase was offset by agents who have left.
Some market players say the setting up of the CEA in end-2010 to regulate the industry has lent some stability.
2012 was a banner year for the the property market, with a record number of over 22,000 units of new private homes sold.
There's also plenty of activity in the HDB resale, commercial and industrial property segments.
Industry players say the new regulatory regime has helped to weed out agents who are not committed or out to make a fast buck.
Mohd Ismail, CEO, PropNex, said: "Prior to the formation of CEA, things were really in big numbers. We tend to grow by 20, 30 percent in good years, when the cycles seem very positive. Ever since the CEA has been formed, we see a more stable rate of growth and it is also not easy to retain people who are not active. An inactive agent have to spend about S$500 to keep his licence active. There is also the continual development that one has to go through...so when people are not serious about the business they tend to fall out."
Still, some agencies are optimistic about growth prospects.
For example, PropNex, which hires over 4,600 agents, expects headcount to grow by 10 percent this year.
OrangeTee also hopes to add more agents in 2013, amid some streamlining of the market.
Steven Tan, Managing Director, OrangeTee, said: "We do expect there could be a consolidation in the market. More smaller agencies would probably join together or some agents from smaller agencies might join the bigger agencies because of the increase in operating cost due to compliance of regulations and because of the intense competition in the market."
On average, some agencies say compliance cost has gone up by some 5 to 10 percent over the last two years since the new regulations kicked in.
Apart from managing costs, industry players say the other challenge is to understand and cope with policy changes affecting the property market.
For instance, PropNex says cooling measures like the Additional Buyer's Stamp Duty will slow sales of private properties in the core central region, while the revised Mortgage Service Ratio for HDB flats will affect sales of larger resale HDB units.
Some industry players say, on average, it takes about one to three months to close a property transaction and this time frame could double after the introduction of a slew of cooling measures earlier this year.
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