Estate agency insolvencies jump 57 per cent

The number of estate agencies entering insolvency has increased by 57 per cent over the course of the past year, according to a recent report.

Compiled by accountants Wilkins Kennedy, the study showed that 77 estate agents folded in the 12 months to June, a notable increase on the 49 that went under during the previous 12-month period.

However, the insolvencies were split across the country, with significantly fewer agents in the London area going under. Anthony Cork, partner with the accountancy firm that compiled the report, told the BBC: “London has always been a more resilient market for estate agents, due to the higher property prices, constant demand and healthier lettings markets.”

He added that transactions in the London area are being made “constantly”, which is helping to support the industry even in the face of “fierce competition”.

The research looked at the reasons behind the industry's struggles, which included an increase in competition from 'quick sale companies', which slash offer prices to help sellers in financial distress or those who are in need of an urgent sale.

Mr Cork added: “The new breed of quick sale companies targets those sellers who are most desperate to sell. As well as snatching instructions from estate agents, they may also be disrupting local property markets as buyers get a distorted idea of what the going rate of property is."

The rising popularity of online market places like Rightmove and Zoopla is also cutting down on available business for estate agents.

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