ESTATE agents could be next on the high street casualty list, as experts warn the cooling housing market and the growth of online firms is leading to financial difficulties.
Experts at accountancy giant KPMG reckon pressures on high street agents will come to a head in the second half of the year, piling further pain on town centres reeling from hundreds of store closures.
Blair Nimmo, KPMG’s head of restructuring in the UK, said: “High street estate agents are presently facing an unprecedented set of challenges.
“The rise of online-only agencies have combined with falling house prices, a general slowdown in sale activity and a raft of legislative changes, all of which have generated headwinds for your average high street agent.
“I would therefore not be surprised to see operators across this sector struggle over the second half of the year and beyond.”
Profits at the likes of Foxtons have come under intense pressure recently, with the London property market slowing considerably since the Brexit vote.
Britain’s biggest listed estate agency Countrywide is also in full-blown crisis as it seeks to raise emergency funding.
It comes as the rise of online firms such as Purplebricks, Emoov and Tepilo has eaten into the market share of bricks and mortar firms.
The high street has been pummelled this year by high profile retail administrations and store closure programmes.
House of Fraser, Maplin and Toys R Us have all gone bust, while New Look, Carpetright and Mothercare have all shut stores.
The casual dining space has also come under pressure, with Jamie’s Italian and Byron among the firms to close restaurants.
“We continue to see companies in the casual dining and retail spaces battle hard in the face of changing consumer attitudes towards spending, coupled with increased costs as a result of the living wage and business rates pressures,” Nimmo said.
But a study by KPMG shows the total number of companies in England and Wales going into administration during the second quarter of 2018 fell sharply.
A total of 302 companies went into administration between April and June 2018, compared with 347 in the previous quarter, a fall of 13%.
Year-on-year, the number was up from 297 administrations seen during the same period in 2017.
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