Increase in NZ real estate agents exiting the industry

PHOTO: FILE

In recent years, the real estate industry in New Zealand has witnessed a significant contraction in the number of active real estate agents. From 16,846 agents in July 2022, the figure has dropped to 15,443 in 2024, marking a decline of approximately 8.3% in just two years. This reduction in agent numbers is largely attributed to the challenges posed by a cooling property market, economic uncertainties, and the evolving demands of the real estate profession.

Market Pressures

The New Zealand property market has experienced a slowdown following a period of unprecedented growth. Between 2020 and 2021, the market was characterized by soaring house prices, low-interest rates, and high buyer demand. This boom attracted a wave of new agents eager to capitalize on the lucrative conditions. However, the landscape has since shifted.

Rising interest rates, tighter lending restrictions, and an overall cooling of the market have led to reduced property sales and slower price growth. These factors have made it more challenging for real estate agents to secure listings and close deals, directly impacting their income. As a result, many agents—particularly those new to the industry or operating on a part-time basis—have found it difficult to sustain their careers in such a competitive environment.

Economic Uncertainty

The broader economic climate has also played a role in the declining number of real estate agents. Inflationary pressures, increased living costs, and a potential economic downturn have caused both buyers and sellers to become more cautious. Fewer transactions mean fewer opportunities for agents to earn commissions, leading to financial strain for those in the industry.

Additionally, the uncertainty surrounding the global economy has made the real estate sector less attractive to those considering entering the profession. The high costs associated with maintaining a real estate license, coupled with the unpredictability of income, have deterred new entrants and prompted some existing agents to seek alternative careers.

Evolving Industry Demands

The real estate industry has seen significant changes in recent years, particularly in the adoption of technology and the growing importance of digital marketing. Successful agents are now expected to have a strong online presence, leverage social media, and utilize advanced property marketing tools to stand out in a crowded marketplace. This shift has increased the operational costs and time commitments for agents, further challenging those who may not have the resources or skills to adapt.

Moreover, the increasing complexity of real estate transactions, including stricter compliance requirements and heightened consumer expectations, has added to the pressures faced by agents. For many, the effort required to stay competitive and compliant in the current environment has outweighed the rewards, prompting a decision to leave the industry.