By Nicola Broomham, Director of Client Solutions
Although the Estate Agency sector has experienced two global crises in the last 20 years, one might argue that the way it operates has hardly changed. The customer and the people working within the sector, however, possess ever-evolving behavioural patterns, trends, and attitudes.
The DNA of an Estate Agent has shifted – it’s no longer just a man with his Filofax, shiny suit and shop window. Estate agents no longer wait for the sale to arrive at their door. Talent within the industry has innovated, developed, and thrived in new aspects that the role now requires to meet consumer demands.
Despite Brexit negotiations and the COVID pandemic, the number of people employed in property across the UK increased between 2019 and 2020 according to the British Property Federation (BPF). Data provided by BPF also highlights that the sector gave jobs to 1% of the population, which contributed to 7% of the UK economy, generating 68.1 billion pounds in turnover in 2020.
The industry’s resilience and relative stability have resulted in a market boom and solidified why the time is now for business growth and expansion. Nevertheless, to scale efficiently, you need the right people powering your agency and you need to know how to keep them – attrition, is we believe, the most detrimental cost to a business.
So, who should be your next hire? Although employees are the most valuable asset to a business, they’re also the greatest investment and come with the highest risk. Talent for your firm is determined by a multitude of factors.
Strong sector experience has generally always remained at the top of requirements when our clients are searching for a new hire. Understandably so – however, do we expect this to change as skills and attributes like creativity, social media content creation and the use of technology become more relevant compared to conventional methods of relationship building, especially when a new generation of customer hits the market – the millennial?
If you are a sales or lettings agent, connecting with the millennial market is mission critical. Business Insider reported 31% of ‘Generation Rent’ now own a home and millennials paid for 60% of the lettings market last year, dominating the rental property landscape. Other generations are adopting the millennial lifestyle and mindset too – many consumers want everything delivered over WhatsApp and in Asia, WeChat, so they can review information at a time that is convenient for them.
It leads us to ask ourselves: are estate agent calls and the skills that mirror that method becoming a thing of the past?
deverellsmith recently conducted customer service research with a leading Estate Agency firm and found that individuals with low ‘telephone sales’ scores over the phone were the most successful billers. Their higher digital activity, a willingness to join the tech revolution, and speed and transparency proved to outshine traditional tools and behaviours.
Not only has technology revolutionised the world but it has provided a catalyst for connectivity. If business leaders can run an organisation from their mobile or laptop wherever they are in the world, why are Estate Agents still typically required to sit behind a desk 9am – 6pm or longer? The pandemic has proven that technology works, it has enabled increased flexibility whilst maintaining productivity. Not offering this soon as a standardised way of working will, we believe, make becoming an Estate Agent a much less desirable profession than it was 10-20 years ago.
So, what contributes to making a highly successful agent?
Property Industry Eye reported that over 60% of buyers find their homes on online portals, and bespoke agents who focus on building personal connections with these buyers as well as the sellers remain dominant players. There is a heavy emphasis on interpersonal skills and customer retention ability, alongside the traditional skill of home finding and matching.
Humans as a species are creatures of habit and enjoy familiarity, as such, customers prefer to deal with the same agent and return to them for future transactions – but are not necessarily loyal to the brand.
So, how do you keep these dominant agents at your business?
Almost the entirety of deverellsmith’s network come to the firm to ask about salaries – what is competitive? What commission structure should be used and how should a bonus scheme be built? Estate Agent starting salaries in the UK generally have not grown over the last ten years – partially due to properties climbing in price and agents having greater opportunity to earn more in commission; because of this, our research suggests a pipeline of talent is being lost to industries like tech, finance, and advertising, where starting salaries are typically close to double those found within Estate Agency
Money does make the world go round, but it isn’t everything – incentives, company culture, a reputable brand, flexibility, and clear career progression are increasingly just some of the aspects an Estate Agent not only desires but yearns to excel and remain loyal to their employer.
To use an analogy, it is like watering your own garden. Nurturing and retaining talent are key for scaling, accurately forecasting business revenue and saving your company short and long-term costs. Ask yourself: What is one action your business is taking to prevent employee attrition?
Last year, deverellsmith’s data and research team surveyed our database of Estate Agent professionals, which unearthed the company values which are most important to potential employees. These were: Respect for People, Integrity, Teamwork and Diversity and Inclusion.
Is your business catering for the needs and desires of your current and prospective employees?
For the first time in history, the Office of National Statistics reported more female property professionals operated in the UK than male. The industry is seen to be more desirable and perhaps accessible through female representation – Netflix’s hit show Selling Sunset pushed female Estate Agents to the forefront as it followed a group of highly successful brokers in the Hollywood hills. As well as small screen representation, we are seeing more female visibility up the ladder – for example, Stephanie Hyde being hired to CEO of JLL UK earlier this year.
However, it is not time for the industry to take its foot off the gas yet – there are still low proportions of women in the highest paid jobs – with just 30% of senior management positions in real estate being occupied by women according to PwC and Real Estate Balance – and gender pay gaps still sitting below the national average. Essentially, we’re losing great female talent – largely when they start a family – due to an infrastructure which doesn’t support their needs. This is a great shame, and we believe a huge opportunity is being missed, as our experience tells us that by supporting and retaining these women through the challenging times of managing a career and raising a family, pays massive dividends all round.
So, what does attrition cost? At deverellsmith we work closely with our clients to understand and uncover their True Cost of Talent – it’s the biggest cost attached to any business and greatest investment when done right. We then help them to understand their ‘cost of attrition’. This, in our view is the number which matters most. When calculating the True Cost of Talent – our data reveals that the cost of attrition for the loss of only one typical Negotiator billing £350,000 per year is a cost of £118,486.15 in London and £82,733.13 in the regions. (Scary – don’t you think?)
Once we have uncovered the numbers, which are always different for every business, we partner with our clients continually to focus relentlessly on these ratios and numbers. Our mission is to increase shareholder value and to support our clients to build better, dynamic, and more sustainable businesses on every level. The best, most profitable businesses in our industry almost always demonstrate below industry standard ratios in this respect. We know this because we work with them, and we are obsessive about ‘people numbers’ – yes, a recruitment firm which cares more about you keeping talent than losing it and is prepared to put its ‘money where its mouth is’ in that respect. We call this service ds Success – and we’d love to chat to you about it in more detail!