Cases of certified real estate agencies closing their doors are on the rise nationwide in the real estate market. Particularly, the gap in the real estate market temperature between Seoul and the provinces, along with the aftermath of scams involving lump-sum lease deposits, has led to a decrease in transactions of non-apartment properties such as villas and officetels. Amid this situation, there is a growing trend towards preferring intermediary corporations over opening individual offices.
According to the Korea Association of Certified Real Estate Agents, in July, 1,029 certified real estate agents nationwide were reported to have closed their businesses. This represents a 9.1% increase compared to the same period last year and marks the ninth consecutive month with more than 1,000 closures since November 2022.
Not only closures but also the number of temporary suspensions increased during the same period. In contrast, new openings in the last month were limited to 909 cases. Notably, since June last year, closures and suspensions of certified real estate agencies nationwide have exceeded the number of new openings.
The increase in closures and suspensions has been influenced by regional and complex-specific disparities in the real estate market and a decline in transaction volume not only for apartments but also for properties like villas and officetels. Furthermore, the fact that some intermediaries have accumulated extensive practical experience and secured numerous properties has resulted in transaction volume concentrating on specific intermediaries, another reason for closures.
Moreover, certified real estate agents are facing survival limits. Regarding this, Kim Hanguil, the chairman of the Nowon-gu branch of the Korea Association of Certified Real Estate Agents, said, "Many intermediaries cannot even secure their living expenses. About 20 businesses have closed this year," and added, "We are enduring with the expectation that transactions will become active with future redevelopment progress."
The maintenance costs that intermediaries must bear are also substantial. The majority of apartment transactions are carried out through joint intermediaries, requiring certified real estate agents to pay a fee and join a network of certified real estate agents in the region. Additionally, advertising costs for listing properties on online intermediary platforms also impose a considerable burden.
On the other hand, openings of intermediary corporations continue in areas with high competitiveness and in regions where large-scale housing complexes are being occupied. Chae Eunhee, CEO of Gaepo Real Estate in Gangnam-gu, said, "Just this year, it seems that more than 50 businesses have opened," and explained, "The impact of increased transactions is due to the influx of newly built apartments through redevelopment."
Furthermore, there is a trend among new certified real estate agents to prefer intermediary corporations. Kim Yoonsu, CEO of BSN Bilsanam, a comprehensive real estate company with over 80 certified real estate agents, stated, "Certified real estate agents are also polarizing. With stricter regulations on assistant intermediaries, it has become even more challenging for small-scale intermediaries to operate, so many are starting with intermediary corporations," and added, "There is a trend towards largescale and corporate intermediaries, so young certified real estate agents are increasingly opting to gain practical experience within affiliated intermediary corporations rather than starting their own businesses from the beginning."
