In just 6 months, the 10 largest estate agents in Spain have closed more than half their offices, reports the Spanish daily ‘EL Pais’.
The collapse in home sales has forced 2 national chains of estate agents into administration (MC Inmobiliaria from Andalucia, and Expofincas from Catalonia). 2 others, Fincas Corral and Don Piso, have been put up for sale, though so far without any takers.
At the end of last year, 9 of the 10 biggest agents in Spain had more than 100 offices around the country. Today, only 3 of them have more than 100 offices. They have gone from a combined total of 3,000 offices at the end of last year to just 1,434 today.
In the fat years of Spain’s property boom, selling houses was a lucrative business that anyone could get into, requiring no professional training or qualifications. As a result, clients got a raw deal.
“If a vendor wanted 180,000 Euros for a property, it was quite normal for the property to sell for 230,000 Euros thanks to various commissions,” one broker working for a franchise told El Pais. “I kept some, the franchise owner took some, then there were brand fees, the cost of the deeds, mortgage opening fees, taxes…..it was crazy.”
The “easy money” to be had in the boom attracted many new entrants, some of them small operators, and some of them international franchises, claims the COAPI estate agents association. “Lots of new brands and franchises turned up with aggressive strategies, which helped drive up prices,” Santiago Baena, president of COAPI, told El Pais.
Coldwell Banker, a large international estate agency, pulled out of Spain in July, just 2 years after entering the market with aggressive expansion plans to open up 300 offices.
If the biggest agents have closed more than half their offices in the last 6 months, the number of small operators going out of business is likely to be just as high. COAPI estimates that then number of estate agents operating in Spain has fallen from 60,000 last year to 30,000 now.