Real estate agencies' estimated commission revenue has been around $400m for each of the last four quarters

By Greg Ninness

There has been no growth in the real estate industry's residential commission revenue over the last year, but considering the state of the economy and uncertainties in the housing market, it's probably faring okay.

Interest.co.nz estimates real estate agencies throughout the country earned around $399 million in gross residential sales commissions in the first quarter of this year.

That was up 26% compared to the first quarter last year, although that was a particularly bad quarter for sales and the commissions they generated.

Total commission levels are still well down from the halcyon days of 2020/21, when total commissions soared to a peak of almost $700 million in the fourth quarter of 2020, and were above $500 million for six consecutive quarters.

But what is surprising about the latest commission estimates is how remarkably flat they have been since the second quarter of last year, hovering just either side of $400m for the last four quarters.

The graph below shows estimated quarterly commissions going back to the first quarter 2018. What this suggests is industry commission revenues over the last year have stabilised around what was the upper end of pre-Covid levels.

With no revenue growth for the last 12 months and an uncertain market outlook for the rest of the year, it's likely that agencies are focused on sharpening their competitive edge and keeping a tight rein on costs.

This story was originally published on Interest.co.nz and has been republished here with permission.