The Times has warned that estate agency is a “bloodbath”, with tough times ahead.
Journalist Patrick Hosking told the paper’s readers: “If you want to know where house prices may be heading, don’t listen to what estate agents are saying. Look at what their share prices are doing. The sector is a bloodbath.
“Countrywide, Britain’s biggest operator, is down 86% in the past 12 months. The shares are also 15% below the level at which shareholders stumped up £140m of rescue capital in August.
“Foxtons, the London-focused chain, is down 37% in the past year and has already responded to the chillier climate by closing six branches.
“Purplebricks, the lauded online disruptor, is down 60%.
“Even Savills, insulated by large international operations, is down 27%. Investors see tough times ahead.”
Hosking said that most agents are forecasting flat to modestly rising house prices, but says that it is the job of agents to take a bullish view as they act for sellers.
However, he says that their shares paint a picture “of a more grisly outcome”.
This, he says, is one where house price falls “lead to very modest transaction volumes as buyers sit on their hands in the hope of lower prices further down the line”.
Friday’s article will be behind a pay wall for many readers, but the comments on it are interesting.
They include: “Estate agents are about as necessary as high street banks. A few are needed, most are not.”
And: “Renting is the only option for many now.”
However, one commentator – maybe an estate agent? – does ask: “Anything positive to say, Patrick?”