Free agent: Increasing competition from online listing services has reduced profitability

A booming residential property market has supported operators in the Real Estate Services industry over most of the past five-year period. From 2013-14 to 2016-17, housing prices strongly grew despite turbulent economic conditions, supported by government incentives and falling interest rates. However, a slower housing transfer rate and falling prices over the past two years offset much of the growth reported over the first half of the five-year period. Government limits on property investment by foreigners also contributed to expected revenue declines in 2017-18 and 2018-19. The commercial property market has performed modestly over the past five years due to volatile business confidence at the start of the period. Overall, industry revenue is expected to increase at an annualised more.

Industry Statistics & Market Size
Annual Growth 14-19
Forecast Growth 19-24
Market Share of Companies
There are no companies with a dominant market share in this industry

Industry Threats & Opportunities

  • Fierce competition in an increasingly saturated market has forced down industry profit margins
  • Greater government restrictions on property investments by foreign bodies have constrained demand
  • The digitisation of real estate services is likely to challenge traditional operators
  • Industry Report - Industry Investment Chapter

    The Real Estate Services industry is characterised by low capital intensity. For every dollar spent on capital, the average real estate operator spends an estimated $11.69 on labour. The industry is labour-intensive and relies on human capital for provision of its services. Commissions also play a big role in incentivising employee performance, which further reduces capital intensity. Although computer software systems have been used in the industry in some instances to make administrative tasks easier, much of the work done by agencies requires client relationships to be developed. As a result, capital intensity is expected to have increased only slightly over the past five years...purchase to read more.

    Additional Insights for the Real Estate Services Industry

    IBISWorld has determined the most important Key Success Factors for the Real Estate Services are:

  • Aggressive marketing/franchising - given the high level of competition
  • Ability to effectively communicate and negotiate
  • Having contacts within key markets
  • IBISWorld analysts also discuss how external factors such as Number of housing transfers and Mortgage affordability in the Real Estate Services industry impact industry performance..

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    What's in this report

    What is the Real Estate Services Industry?

    Industry operators are primarily engaged in appraising, purchasing, selling (by auction or private treaty), managing or renting residential property, commercial property, or a combination of the two.

    Industry Products
  • Property sales
  • Property management
  • Property leasing
  • Other services
  • Industry Activities
  • Conveyancing (other than by qualified legal practitioners)
  • Real estate agency, auctioning, body corporate management and brokering
  • Real estate management
  • Real estate title transfers (other than by qualified legal practitioners)
  • Timeshare apartment managing
  • Title searching
  • Appraisal of real estate
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Number of housing transfers
  • Mortgage affordability
  • Residential housing loan rates
  • Consumer sentiment index
  • Residential housing prices

  • Current Performance
  • The residential market
  • The commercial market
  • Profitability and industry structure
  • Chart: Revenue Growth

  • Industry Outlook
  • Residential property growth
  • Commercial property trends
  • Operating challenges
  • Table: Real Estate Services Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Real Estate Services Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Residential Property Operators
  • Finance
  • Office Property Operators
  • Retail Property Operators
  • Industrial and Other Property Operators

  • Key Selling Industries
  • Specialised Design Services
  • Wired Telecommunications Network Operation
  • Wireless Telecommunications Carriers

  • Products & Services
  • Property sales
  • Property management
  • Other services
  • Property leasing
  • Chart: Real Estate Services Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Household owner-occupiers
  • Investors
  • Commercial businesses
  • Chart: Major Market Segmentation for the Real Estate Services Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Wages
  • Purchases
  • Rent
  • Other Costs
  • Marketing
  • Chart: Cost Structure Benchmarking – Sector vs Real Estate Services

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Real Estate Services Industry

  • Industry Globalization
    There are no major players in this industry. This report includes analysis of other companies.
    Capital Intensity
  • Chart: Level of Capital Intensity for the Real Estate Services Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Real Estate Services Industry
  • Industry Revenue (2010-2024)
  • Industry Gross Product (2010-2024)
  • Establishments (2010-2024)
  • Businesses (2010-2024)
  • Employment (2010-2024)
  • Wages (2010-2024)
  • Wages (2010-2024)
  • Purchases (2010-2024)
  • Profit (2010-2024)
  • Depreciation (2010-2024)
  • Rent (2010-2024)
  • Utilities (2010-2024)
  • Other (2010-2024)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    First Home Owner Grant
  • A government grant for first home owners. This is a national scheme funded by states and territories.
  • Private Treaty
  • Where the sale of a property involves negotiations and offers between the buyer and seller over a period of time, rather than through an auction setting.
  • Vendor
  • Property owners that are looking to sell their property.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Real Estate Services market research report is a comprehensive guide to market size and growth prospects. Our industry reports offer strategic industry analysis of the factors influencing companies, including new product developments, economic, lifestyle and demographic influences, distribution and supply chain factors and pricing issues. Full analysis accompanies our data forecasts to illustrate how the market responds to emerging industry trends.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Real Estate Services:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Real Estate Services market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Real Estate Services, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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