This report presents the Allen Consulting Group’s research, analysis and findings of its study into segmentation in the market for estate agency services in Victoria. The report is provided to the Estate Agents Council (EAC), to assist its review of the licensing framework under the Estate Agents Act 1980 and Regulations, as requested by the Minister for Consumer Affairs.

Objectives

The study’s objectives are to identify and describe segmentation in the market for estate agency services, and for each segment, to:

• examine the transactions, characteristics and functions of suppliers and consumers in the market;

• identify the risks to participants in the market for estate agency services and the available protections; and

• assess competition, including the impact of changes in the regulatory arrangements over the last five years.

The Victorian market for estate agency services

The role of estate agents is to facilitate property transactions by bringing together parties to such transactions in an effective and efficient way.

Estate agency services consist of appraising, purchasing, selling, managing or renting real estate for others. For the purposes of this study, the activities considered to comprise ‘estate agency services’ are:

• property sales;

• leasing and managing property;

• buyer advocacy;

• business broking;

• real estate advisory services; and

• specialist services that form sub-activities of any the above (e.g. auctioning).

  Evidence supports the notion that there is a market for estate agency services, and that there exists a market in Victoria.