Recruiters are warning of a ‘brain drain’ in the estate agency high street industry.

One, Anthony Hesse of Property Personnel, said “a significant number” have gone to work for online agencies.

Deverell Smith, chiefly specialising in the London market, said that huge attrition in staff at some of London’s best known estate agency brands – including national names – means that firms in the middle market are having to keep on and on hiring.

Both Property Personnel and Deverell Smith said that good people are leaving the industry.

Andrew Deverell-Smith, founder of recruitment company Deverell Smith, said that some London firms are seeing an attrition rate of 70% a year, and climbing.

He said that already high staff churn is increasing due to a combination of the cost of living in London, very low basic salaries and poor work morale.

Deverell-Smith told EYE: “In London zones 1 to 4, it is common to see basics of £10,000 to £14,000.

“One board director I spoke to recently said that they were effectively paying the minimum wage, so why would anyone want to go and work for them.

“I said that was a very good question.”

Firms are not, however, making redundancies because they don’t need to, said Deverell-Smith.

He went on: “But what is happening is that a lot of very good people are leaving, and being replaced with someone more ordinary.

“There is a flight of talent from the industry.”

He said some are permanently leaving estate agency, often going to tech start-ups which he says “are on the front foot” when it comes to offering a dynamic work culture.

He went on: “If they are not leaving for other industries, then they are leaving for other parts of estate agency with broader prospects.

“For example, the very top brands – Knight Frank and Savills – offer really interesting and varied careers. They also pay much better basic salaries.”

He said: “Over the last 24 months – since Osborne introduced his Stamp Duty reforms – the London market has been very difficult.

“There is a lack of energy and positivity within some of the biggest names. Four or five years ago, London agency was a completely different place to work.

“It used to be good fun and energetic, but people are now working in very negative environments.

“There are a lot of weary senior managers and they are not inspiring their staff.

“If you are in the middle of a two-year cost-cutting exercise, it’s not going to be much fun.

“However, the market will recover and one day the sun will come out.”

However, he said that too few firms are thinking about the leadership in the years ahead – and need to be hiring strong and able candidates now.

He said they need to be more broad-minded in their recruitment approach: “They always ask for the same thing, someone with two or three years’ experience. But that person may have been little more than a door-opener.

“But someone in their 40s or a woman who has taken time out for children may have a lot to offer, and really understand sales.”

He said that the industry is getting younger. “I am all for youth, but a first-time buyer in London is now aged 38 and may be unwilling to take advice from a 21-year-old who doesn’t own a home.”

He said that at the very top end of the market, which he says is “bursting back to life”, it is a totally different story.

Here, some firms are now looking at their top tables: “As a recruitment company, we are doing some of the largest deals we have ever done. For example, we are about to place the chief executive of a big London brand.”

Negotiators pulling off sales of prime-homes worth £25m and more, are earning £250,000 to £450,000.

He said: “It is a fascinating time in the industry – but in London at least, it is a difficult market in the main.

“The recruitment industry as a whole will have had more vacancies to fill this year than last, but for the sake of the future, estate agents must be more open-minded as to how they recruit and what they are offering.”

Deverell-Smith concluded: “Despite the challenges, I remain very confident and optimistic. I love this industry and want to help it survive and thrive.

“We have designed a number of bespoke solutions to our clients as a result of the challenging conditions they face which enable them to tackle many of these challenges head on and attract outstanding talent.”

Another recruiter, Joshua Rayner who deals in markets across most of the UK,  confirmed the huge growth in the number of vacancies.

He said his firm, Rayner Personnel, which is active across the UK, dealt with 629 vacancies last year. So far in 2017, it has had 1,987 on its books.

He said: “Everyone wants the same people, which is creating a shortage of good candidates.”

Anthony Hesse, managing director of Property Personnel, said: “The market is pretty challenging at the moment. It’s polarised, with sales struggling much more than lettings. The two usually mirror each other, but this year we have noticed far more positivity in the lettings side of the industry.

 “The market is both candidate and employer driven. There’s a massive shortage of the right quality candidates out there at the moment.

“Clients’ expectations have risen and they’ve set the bar much higher than perhaps three to four years ago when the market was flying. Now they are very careful where they spend their hire money.

 “So clients are much fussier. But then, so are the candidates.

“The good ones know they are in demand because they are aware that there is shortage of them, so they are being pickier about who they choose to work for. This means there is something of a stagnation in the industry, with the two sides eyeing each other up and down.

“A lot of employers think that they are in the driving seat because people want to work for them. But candidates know they are in demand, so they have high expectations too.

 “In terms of movement, there are a lot of people registering – but what they are looking for is not really available in the market place. In sales, which has been hardest hit, a significant number have gone to work for online agencies, and quite a lot of people have moved out of the industry.

 “What’s changed with vacancies is that they now represent the junior level of jobs.

“Employers are much more open to considering trainees because they have to look more closely at their costs. In lettings, people are still moving around within the industry, or looking to move into other sectors where they can utilise their lettings skills – such as support roles in property management or the PRS. But in both sales and lettings, all of them are hankering after the right work/life balance.

 “Vacancies have been quite consistent throughout the year. Whilst there are shifts on the sales side, they are just much more junior over all. In lettings, there has been a significant increase in the number of business support roles – property management in particular.

 “Ultimately, the ideal candidate everyone wants is someone with 12-18 months experience: a typical second jobber.

“But those people are thin on the ground – because at that stage, either they stay where they are, or they get out of the business altogether.”

[Editor’s note: The recruitment firms mentioned here are entirely unconnected with the one referred to – although we have chosen not to name it – in the next story.]