Sell my Estate and Letting Agency

I want to sell my Estate Agent business

If you are interested in exiting your estate and letting agency due to impending retirement, trading challenges or to direct your focus to alternative interests, selling your business can provide a suitable exit route which can generate returns from your investment. By transferring ownership, you can preserve the financial value of your business and ensure business continuity. If your estate agency has been under family ownership for generations, you may wish to take this route if you have no relation to transfer the business onto.

As an alternative to a solvent company liquidation, selling your estate and letting agency business can help unlock the financial efforts of your investment. If income flow is volatile and trading conditions are challenging due to the current climate, you may wish to sell your business before it absorbs financial damage. Under robust leadership and an owner with strong financial security, your business may be bolstered, pushing it to thrive, grow and break into new markets.

Selling my Estate Agent business

As estate and property agent businesses naturally evolve their services to integrate new technology and raise the bar against competitors, the sector continues to rely on offline methods of interaction through physical branches and business development efforts. An agency as such is likely to be driven by a range of employees to cater to a varied group of customers, from vendors, brokers, buyers, solicitors and financial advisors. As the property sale market is operated by regional players, making it a competitive landscape on a local level, sector issues and opportunities continue to fluctuate. The coronavirus pandemic has left a long-lasting effect on the residential and commercial property market, impacting the industry in the following ways:

Social distancing – As the coronavirus pandemic led to the enforcement of social distancing measures, triggering a shift in consumer willingness to visit properties and instigating nervousness in vendors to open their homes to prospective buyers, property and estate agents have been forced to adapt their services to overcome this challenge.

 

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• Previous sales and acquisitions experience
• Sector specialisms and average success rate
• Sales value expectations and growth potential

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As estate agents launch virtual viewings for each property marked for sale, this filters the number of prospective buyers physically walking through the door, trimming this down to those genuinely interested in submitting an offer. Digital signatures and electrical checks have also taken the front seat to minimise contact and make documents easily accessible. The coronavirus pandemic has pushed estate agencies to adapt to cloud-based services to grant remote access to staff and customers, directing investment to digitise the business.

Withdrawal of core mortgage products – Following trading uncertainty due to the coronavirus pandemic, mainstream lenders have withdrawn the majority of high loan-to-value (LTV) products and tightened eligibility. As this reduces the number of new buyers flooding the market and protects the financial position of lenders from economic unpredictability, estate agents have experienced a shift in buyer interest. As First Time Buyers are rejected by competitive lenders, resulting in the mass withdrawal of house offers, older buyers are replacing this gap in demand to take advantage of temporarily reduced Stamp Duty rates.        

Housing boom - UK house prices have skyrocketed at the highest rate since 2016 due to the reopening of the market after the seven-week shutdown during the coronavirus pandemic and the stamp duty holiday. Following the release of pent up demand over this period, Halifax reported that house prices increased by 7.5% in 2020 in comparison to 2019.

As unprecedented market conditions shake up buyer demographics and ongoing legislative changes influence the rise and fall of buyer interest, estate agents and supporting industries, such as the financial services sector have the opportunity to react fast through joint efforts and feed demand.

Preparing your Estate Agent business for sale

We have a vast array of property agent businesses for sale and a proven track record of selling estate agents across the country, so we know what prospective buyers are on the search for and what makes an estate and property agency unique. Prior to listing your business for sale, it is vital to tighten internal operations, conduct a review of business outgoings and ensure that your financial affairs are in order. When searching for estate agents for sale, interested buyers will conduct due diligence to track the financial health of your business, reputation and investigate customer experiences. To present your business in the best light, converse with transparency to proceedable buyers and share your reason for exit.

How much is my Estate Agent business worth?

Valuing an estate agent business consists of taking into consideration company assets, liabilities and several business features. The financial worth of your estate agents will be calculated through a company valuation to establish a starting price and assist you in negotiations with prospective buyers. Following this stage, you can filter prospective buyers with the relevant capital and appetite to buy into your business.

Ownership structure: This will determine the route to selling your estate and lettings agency, from pitching the sale of your business internally to the franchisor or undertaking the process externally, through a business transfer agent, broker or independently. If you are trading as a franchise, ownership of intellectual property may vary to that of an independently operated estate agency, however, the opportunity to relocate may be unrestricted due to the business structure. If the business is strong performing as a direct result of the location and due to the specialist knowledge of the local landscape, this could influence the buyers’ decision.

If you are selling an independent estate agency, offering a turnkey opportunity reduces the level of investment required for prospective buyers. If your estate agent business is established, the reputation of your brand name will hold value to prospective buyers and contribute towards financial value if you have existing accounts available generating recurring income for the business, including partnerships.

Property tenure: If your property is freehold, this increases the business value as you own the building and the land that it stands on. If a prospective buyer wishes to relocate the business or generate rent, this gives them the option to do so. If the property is freehold, buyers are likely to question if a break clause can be reasonably executed.

Office premises and tangible assets- The quality of the property and equipment will also contribute towards the overall value of your business. If your office is fully fitted and comprises of IT equipment of an exceptional standard, this is likely to increase your business value. As the nature of the profession consists of a high volume of incoming calls, leading residential and commercial estate agents use specialist software to populate client data, handle enquiries and log calls. Software ownership will also contribute towards the financial worth of your business.

Reputation - If your agency consists of a website to establish an online presence through, generate conversions and display key information to prospective buyers, this will contribute towards the worth of your property agency. From a reputational point of view, online reviews can also influence consumer behaviour, as with prospective buyers. As a requirement laid out by The Property Ombudsman (TPO), estate and letting agents must be registered with a redress scheme to legally trade and be a member of an approved Client Money Protection Scheme, impacting your credibility and reputation.

Employee structure – The business transfer process consists of calculating overheads, including staff wages which will vary based on your staff structure and the contract details. The veins which run through each business vary and therefore, there is a no one-size-fits-all scenario.

Your appointed business transfer agent or business valuation service provider will be able to identify the areas of your business which hold the most value and which aspects require improvement to maximise sale value.

Value my Estate Agent business

The Selling My Business team are veterans in the business transfer sector and have over 100 years’ collective experience under their belts. Our in-house valuation team can conduct an estate agent business valuation and advice you on how to achieve the industry benchmark by sharing their knowledge of the sector. We require 3 years’ worth of recent/historic accounts to review company assets, liabilities and gross profit margin. If you’re wondering how to value an estate agent business, the Selling My Business team will talk you through the process.

Founded over 60 years’ ago, we are renowned business sales experts with a vast record of prospective buyers actively searching for businesses in the professional services sector. Our service consists of assisting you throughout the business preparation stage, sourcing a buyer, through to final sale negotiations to secure a competitive sale price for your estate agency which matches the market value.