Estate agents are likely to get through the next five to six months even if the market falls away – but November is most likely the critical month.
That’s the forecast from the chief executive of property recruitment firm Rayner Personnel who says the immediate future should be easy for agents to get through.
This is because portal fees are on offer and the furlough scheme is still at its most generous.
However, Josh Rayner is forecasting problems later in the year.
“[There’s] a problem coming down the tracks as the government support starts to dilute because it’s as this happens that cashflow will potentially be most vulnerable – a combination of landlords insisting on backdated rent payments, Rightmove and Zoopla support waning and an absence of deal completions from a barren lockdown period – all make for a collision of circumstances that some agencies may not easily cope with come November” he forecasts.
From the end of the summer estate agency employers like every other will be required to support the cost of furlough in respect of funding employer national insurance and pension contributions.
From September an additional 10 per cent will have to be paid by agency owners as government insists employers pay the difference between the current 80 per cent furlough threshold and a revised 70 per cent government contribution – and then 60 per cent from October.
Typically an estate agent in the UK earns £28,800 annually according to the average from the Office for National Statistics and other sources; on that basis, the total salary burden for the whole agency industry would be up to £122m per month once furloughing is scrapped entirely.