Paying staff too little is stifling growth and profits – ex-ARLA president

Sally Lawson

Paying staff too little is a sure-fire way to hinder growth and profits, according to former ALRA president, Sally Lawson.

“From my work with agents I often hear that one of their biggest challenges is finding decent staff,” she explained. “So I decided to do some research into why our industry, like so many others, was struggling to recruit. What I found was quite shocking.

“Of all the property manager jobs posted on Indeed across the UK, a staggering 37% of them were showing an average salary of between just £20k and £25k. And that’s just not enough.

“Property managers, or tenancy managers, are the absolute powerhouses of our businesses. They have the legal knowledge, handle inspections, go to court, protect our agencies and most importantly, are the ones responsible for protecting our landlords and tenants. Yet, we’re offering them pay that is skirting the National Minimum Wage.”

Lawson adds that the average letting agencies earn a profit of just 11.9% – a tiny amount for any business but especially considering the risks taken by those working in the sector such as precarious liability, new legislations and compliance, as well as outcomes like fines, ban orders, and prosecutions.

She continued: “What I also find interesting is that many agency owners are only paying themselves on average around £40k. When you take into account that they’re quite often working more hours than anyone else within the business, it can be close – if not less than – the National Living Wage. So if the owner is on that, it’s no wonder that over a third of property and tenancy managers are only being offered £20-£25k.

“I believe it’s vital that we should be earning good money for the risks we take in our business,” she added. “If we pay our staff well, they’ll stay. In my team, we have over 50 years of combined service because we’re passionate about making sure we nurture their skills, look after them, and build a strong and positive culture.

“So, if you’re one of those agents offering your staff pay within this bracket and aren’t earning enough yourself, it’s time to look at the profitability of your business and get these salaries up significantly (and fast). The primary goal of any letting agents is to increase revenue by growing property stock, retaining property stock, and utilising opportunities to upsell and sidesell.”

“To make serious money, it’s time to move the needle and generate more revenue – whether it’s via joint ventures, affiliates, portfolio takeovers, adding different services and adding value to your clients and profit for you. It’s your choice how much profit you want to make, but we recommend a safe place is to aim for at least 30% or above, that way you can make enough profit to pay yourself, and your staff, adequately. And ultimately, to do what we all know we should be doing, and that’s working on our businesses and not narrowly focused on working in it.”


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  1. Bless You

    Broken industry. and for some reason we keep giving the money to the spade makers.

    Rightmove etc

  2. Property Ear

    If a manager/owner knows how to charge his clients, then pays and appreciates his team properly, he will succeed.

  3. RCM1962

    Just yet another reason why we need licensing. Licensing will create barriers to entry, improve industry standards, improve customer experience and help facilitate a turn around in the multi decade downward trend in fees, thus allowing more money to be invested in quality recruitment.

    1. jan-byers

      It will not inmprove standards – EA is not rocket science
      Lawyers take many years to qualify – some get barred every year for malpractice
      The current house selling system encourages competition and gives the public choice
      It is up to the agent to explain why they charge more than they currently do – not the govt to decrease competition for the public

  4. Neil Robinson

    Simply, you’re not going to get peak performance from staff who feel underpaid and underappreciated.

    I’d much rather pay a little more on the basic salary and get them to focus on service and excellence.

    Pushing the salary down as far as you can, and “incentivising” them with top heavy commissions has two effects. One, they simply focus on piling in as many dicky sales as they possibly can and neglecting the service side. Two, if they have a bad month, they then worry about paying the bills, which invariably affects their mental health, and therefore performance.

    This industry will only be “professional” if we pay properly, service properly, and charge properly.

    1. RCM1962

      100% correct. Estate Agency is predominantly a marketing and customer service business, much less so a sales business. Get those first two right, partly from better quality recruitment, development and wages, and and the sales will take care of themselves. The over heavy sales culture in EA needs to re balance its emphasis towards a customer service culture.

    2. CountryLass

      When I first started in the industry, and asked for a pay rise, I was told that the reason the basic was low and the commission was high was to give an incentive to sell lots as it wasn’t possible to live on the basic. I pointed out that if I’m worrying about eating and keeping a roof over my head, I’m not going to have much energy to sell, am I? They did not see my point.
      To me, a basic wage should be enough to cover ‘reasonable’ expenses and allow a bit to save, although I appreciate that some will just prefer to spend it all; that is their choice. Then the commission is there to allow for the luxuries, the foreign holiday, home improvement, replace the car etc. The commission should not have to be used for basic living costs.

  5. jeremy1960

    One of the main issues has surely been the driving down of fees over years.
    I am no longer involved in sales, just lettings but can see that online agents promoting low fees (or no fees!) has been a huge influence amongst High Street agencies. It’s possibly too late now as the public are programmed to think fees rather than service but if fees rose, income would follow leaving money to pay staff better?
    If staff were to understand that by reducing fees it would affect their pay, then that may help?


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