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AS A sign of the current market conditions, a total of 104 property agencies and 3,573 real estate agents left the industry after the latest licence renewal exercise with the Council for Estate Agencies (CEA).
The CEA had licensed 1,369 estate agents and registered 29,262 salespeople as at Jan 1, 2016.
In the past year, there were 1,299 new salespeople who joined the industry, said CEA, which explained that the figure excluded those who left and rejoined. This is a drop from the 3,006 new salespeople in 2014.
"This could be a reflection of the property market sentiments," CEA director (policy and licensing) Heng Whoo Kiat said of the overall decline in the number of registered salespeople. He added that salespeople are also probably mindful of the cost of being in the industry.
Under the CEA's regulatory framework, salespeople are obliged to commit time and resources to meet the continuing professional development (CDP) requirements for annual renewal of their registration. As for new entrants to the industry, they have to complete a course and pass a qualification examination.
These costs stack against diminished commissions agents are clocking as property transactions fell off the cliff since 2013 with the imposition of the total debt servicing ratio (TDSR).
Among the agencies that closed down last year was CI Agency, a franchise of Colliers International (Singapore) for Singapore residential sales and leasing activities. It had 40-50 salespeople when it ceased operations.
Tepid market conditions have also put the expansion plans Chesterton Singapore had for its agency business in reverse gear, as its team of brokers dwindled from 88 last year to seven.
Chesterton Singapore is not treading the associates route for now as it seeks to hire more full-time staff to undertake a suite of professional services from valuation and investment sales to commercial real estate and tenant representation, said managing director Donald Han.
Of the top 10 biggest agencies, HSR International Realtors and DTZ Property Network shed the most number of agents compared to a year ago - by 45.5 per cent and 19.9 per cent respectively to 578 and 1,385 as at Thursday.
Industry insiders note that DTZ Property Network has been beset by uncertainties concerning its parent DTZ Debenham Tie Leung (SEA), whose founders are still in talks with a TPG-led consortium to sell their stakes.
Amid tough times for agencies, a new association, the Singapore Estate Agents Association (SEAA), will be launched by the first quarter of this year to raise the level of professionalism in real estate agency work and provide a unified voice for agencies and their salespeople.
Commenting on SEAA's formation, a CEA spokesman said: "CEA looks forward to SEAA playing a proactive role in raising the professionalism of the estate agency industry and will work closely with the association."
At at Thursday, there were 5,946 agents at ERA Realty, 5,506 agents at PropNex Realty and 2,851 agents at Huttons Asia - the three largest agencies by agent strength.
PropNex CEO Ismail Gafoor noted that more agents are leaving the industry as tougher market conditions require them to invest more time to reach out to clients. The tight labour market could also have induced some to take up full-time jobs with stable incomes and regular CPF contributions. There were also others who could not fulfil CEA requirements such as the mandatory CDP training hours or contributions to their Medisave accounts, he said.
Agencies are ramping up training and support for their agents - with some even looking to transform their agents into relationship managers.
HSR International started three classes in the past three months to train its salespeople to work like relationship-cum-asset managers. "The programme is based on a one-year mentorship programme to re-equip our salespersons to treat a property not just as a space for usage but also as an asset and an investment," said HSR chairman Patrick Liew.
Revving up technological support for its staff, KF Property Network rolled out a new mobile app this month to allow its salespeople to access transaction data, browse projects, perform a property search, e-mail typical floor plans to prospective buyers, post their listings in the portals they subscribe to (including Facebook) and co-broke with other salespeople. They can also book their training via the mobile app.
"All these and other functions can accord salespersons with convenience, speed and more effective turnaround time in their transactions through the app and while on the go," said KF Property Network managing director Tan Tee Khoon. "We have also revitalised our training framework to help salespersons at various experience levels from the newbies in the industry to the veterans."
Other agencies have spread their wings abroad. ECG Property, which saw its agent force here trimmed by 37 per cent over last year to 146 salespeople currently, is growing its overseas network as part of its restructuring efforts under listed parent Teho International. ECG Property managing director and CEO Eric Cheng said the agency has close to 430 overseas agents registered with ECG and its franchisees. It is opening franchisee offices in Indonesia, India, Thailand and Hong Kong this year.
"This year could be a pretty tough year for all agencies if Singapore transactions don't pick up - the overheads are getting higher and there are more compliance requirements. The next 18 months will be pretty challenging so we need to ensure we have the overseas network," he said.