Departing McGrath real estate agents are reported to be setting up a rival

Peter Parks/AFP/Getty Images

The run of real estate agents leaving ASX-listed McGrath reportedly includes a group setting up a rival business.

Industry news site Property Observer says the agents are set to launch as The Agencyin less than six days.

McGrath yesterday reported on the sudden resignations of a large number of its real estate sales agents.

The departure of 36 sales agents, leaving 225 still with the company, will impact earnings.

“While the company is actively recruiting, the usual time for an agent to become fully productive means these new agents will not match the volumes required to maintain our previously expected second half earnings,” the company says.

McGrath shares lost 5% yesterday as the company reported a profit downgrade, partly due to the departure of the agents but also due to a lack of properties to sell. A short time ago, they were trading at $0.765, down another 5%.

While home prices have surged, the latest numbers from property industry analysts CoreLogic show a steep drop in the number of properties for sale in most capital cities.

There are 13.9% fewer for sale in Sydney than a year ago, 8.4% down in Melbourne and 20.1% in Canberra.

The Property Observer report, by veteran industry expert Jonathan Chancellor, says the partners in the new business are still unconfirmed.

“Longtime McGrath agents Matt Lahood, Stephen Chen and Ben Collier have all maintained a low profile since their departures last year,” Chancellor writes.

“Their departures were preceded by weeks of avoiding any confirmation of any departure decision — and in some cases outright denials of any departure. It is widely assumed they will band together in the new outfit.”

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