Estate agents’ incomes show big rises
Estate agents’ incomes show big rises
A survey compiled by Rayner Personnel has assessed basic salaries and OTE earnings for 12 grades ranging from trainee negotiator to managing director.
The six year analysis shows that the more senior the position the bigger the percentage increase, with OTE rising faster than basic except at the most junior levels.
The results are as follows. The figures are for now, 2014, and show the increases since 2008 in brackets.
The full report by Josh Rayner of Rayner Personnel follows beneath these figures
Trainee Negotiator Basic: £12k-£15k (up 25%) OTE: £18k-£20k (up 5%)
Land/New HomesNeg Basic: £18k-£22k (up 22%) OTE: £32k-£35.5k (up 11%)
Negotiator (12 months) Basic: £15k-£16k (up 6.5%) OTE: £20k-£25k (up 25%)
Senior Neg/Valuer Basic: £16k-£19.50 (up 8%) OTE: £30k-£50k (up 56%)
Assistant Manager Basic: £18.5k-£22k (up 15%) OTE: £40k-£60k (up 58%)
Branch Manager Basic: £25k-£28.5k (up 12%) OTE: £50k-£75k (up 80%)
Lettings Manager Basic: £25k-£28.5k (up 14%) OTE: £50k-£70k (up 27%)
Mortgage Advisor Basic: £25k-£28k (up 12%) OTE: £50k-£70k (up 40%)
Regional Director Basic: £50k-£80k (up 37.5%) OTE: £120k-£180k (up 50%)
Managing Director Basic: £80k-£150k (n/c) OTE: £250k+ (n/c)
What is a good estate agent worth? by Josh Rayner
Since the mass exodus of 2008 when throngs of estate agents were unceremoniously laid off or left the industry in search of greener pastures, only a handful have returned. Recognising that a dearth of experienced property professionals is as big a growth constraint as the limited supply of properties for sale, savvy estate agents are holding on tight to top performers, locking them in with the prospect of accelerated career progression, generous incentives (over and above commission) and even shares in the company.
This presents a challenge for industry headhunters. Joshua Rayner of Rayner Personnel explains, “At this time of year senior people already built up a sizeable pipeline. They are understandably reluctant to move and lose that commission. We’ve got clients who are desperate for talented property professionals to capitalise on the opportunities arising from a rising market but are having to work very hard to tempt good people to consider fresh opportunities.”
Agents are finding that while it’s not hard to recruit trainees and disillusioned career switchers with little or no property experience, it’s considerably more difficult to find experienced property professionals with proven track records. The skilled people firms seek are normally working for one of their competitors and the best way to attract these prized, high calibre individuals is to headhunt. But success will depend on whether the overall package they are offering is attractive enough to justify jumping ship. So are you paying enough?
Innovative Midlands agent Newmans is pioneering a business model, which is the norm in many other parts of the world such as the US, Australia and South Africa under which far from receiving a guaranteed salary and perks, negotiators are paid solely on results. Unlike the traditional UK estate agency model of employed negotiators, Newmans’ self-employed associates work under an established brand name but effectively run their own business. Much like a franchise – but without the upfront fee – they receive back office admin and marketing support, freeing them to focus on fee-earning activities. As Newmans bears all the overhead costs, everything an associate earns goes in their pocket.
While associates typically bear an initial period of two to three months with no income while they build up a sales pipeline, once they start earning commission rates are spectacularly high – between 36% and 50% based on sales volumes – compared with the average employed agent’s 4%.
Entrepreneurial managing director Sean Newman pioneered the concept some two and a half years ago and it has proved hugely successful. “Homeowners like the idea of dealing with the business owner and I find it attracts a higher calibre individual,” he explains. “They’re ambitious, self-motivated high flyers who want to run their own business and earn good money rather than work for someone else and have a limit on their earnings. In my experience, the majority of self-employed Newmans associates earn at least double what they would as an employee.”
But he adds “It’s not only about the money. Some people don’t particularly care about earning more but want to work fewer hours. Others want the flexibility. What they all have in common though is the desire to control their own destiny.”
To ensure high standards are maintained, Sean insists all recruits who are new to the industry undergo Estate Agency All-Stars’ comprehensive five-day training course. The associate bears half the cost because as Sean says: “I’ll invest in people who are prepared to invest in themselves. It shows they’re serious about building a new career and means they can hit the ground running.”
Sean follows the same model for the ten licences he holds for upmarket firm Fine and Country, which specialises in the upper quartile of the market. He reports: “My associates are earning some serious money considering we’re in the Midlands, not London. While a Newmans associate can comfortably earn £100,000 a year that could be closer to £200,000 with Fine and Country.”
Newcomers like Purplebricks, which proclaims itself to be ‘the first 24 hour estate agency’, aim to disrupt the property industry with its internet-based service and low fees. It is too early to predict with any certainty what impact it will have but Josh Rayner’s view is that: “I feel that eventually, like everything, online estate agents will take a larger share of the market in years to come but as a traditionalist I feel there will always be a place for the high street agent.
“Many people are unwilling to entrust the biggest personnel transaction of their lives to an online-only service – they find it too impersonal and want the reassurance of a human touch.
“The internet may offer cost-savings and the convenience of around-the-clock accessibility but many people will be unwilling to entrust what is usually the biggest personnel transaction of their lives to an online-only service – they find it too impersonal and want the reassurance of a human touch. People buy people and I believe that will never change.”