Agency sector set for growth in 2023

The UK estate agent industry is expected to grow by 3.2% in 2023, new figures suggest.

Hybrid agent Nested analysed historic data on the size of the sector and the estimated number of agency businesses operating within it, to see just how the sector has performed in recent years.

Using figures from data provider IBIS World, Nested claims that agency revenues peaked in 2019 at £14.316bn across the sector, with some 21,232 estate agency businesses thought to have been operational at the time, resulting in an average revenue per agency of £674,270. 

When the pandemic struck, the total size of the sector retracted over two consecutive years to £11.719bn by 2021, the lowest level since 2014, shaving £120,000 from the average estate agents estimated revenue in the process. 

This trend reversed last year, according to the research, with the size of the estate agent market increasing by 10.1% to £12.906bn.

The number of estate agent businesses also grew by 2.3%, with the average revenue per an estate agent up 7.7%.

Nested is now estimating that the size of the sector will hit £13.3bn this year - a 3.2% increase on 2022. 

The figures also estimate that the number of estate agents operating within the sector could climb by 2.2% to 22,098, the highest number since 2013. 

Despite more competition in the market, the average revenue per agent is also estimated to increase by 1% to £602,874. 

Alice Bullard, managing director at Nested, said: “The UK property market may have boomed during the pandemic, but the estate agency sector certainly felt the impact, with the overall market size of the industry declining quite notably between 2019 and 2021. 

“However, this tide has started to turn and despite the uncertainty of the wider economic backdrop, we’ve seen a strong level of growth over the last year and a strong start to 2023. 

“There’s no doubt that the self-employed estate agency model has helped facilitate this growth, providing a platform for those who may otherwise have struggled to remain operational. 

“While the market is yet to return to the giddy heights it reached in the early days of the pandemic, the current upward trajectory speaks volumes about the resilience of the sector and the tenacity of those working within it.”