Major companies in the real estate agency and brokerage services market include CBRE Group; Jones Lang LaSalle Inc; Newmark Grubb Knight Frank; Keller Williams and Century 21.
The global real estate agency and brokerage market is expected to grow from $960.12 billion in 2020 to $1008.95 billion in 2021 at a compound annual growth rate (CAGR) of 5.1%. The growth is mainly due to the companies rearranging their operations and recovering from the COVID-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in operational challenges. The market is expected to reach $1351.1 billion in 2025 at a CAGR of 8%.
The real estate agency and brokerage services market consists of sales of real estate and brokerage services by entities (organizations, sole traders and partnerships) that act as agents and/or brokers for real estate activities. The real estate agency and brokerage services market is segmented into residential buildings and dwellings brokers; non-residential buildings brokers; mini warehouses and self-storage units brokers; and other brokers.
Asia Pacific was the largest region in the global real estate agency and brokerage market, accounting for 53% of the market in 2020. North America was the second largest region accounting for 23% of the global real estate agency and brokerage market. Africa was the smallest region in the global real estate agency and brokerage market.
Real estate companies are investing in artificial intelligence applications to perform various functions such as property search, building management and design. Artificial intelligence is helping real estate companies to find people looking to buy or sell properties, find a suitable property based on customer requirements, redesign office spaces based on user behavior. According to a research conducted by Drooms, AI technology provider around 54% of property professionals surveyed already use artificial intelligence to improve keyword search and 69% believe AI gives their companies competitive advantage by enabling high speed search of documents. For instance, REX, a real estate company analyses data from third parties such as Google to determine willingness of a person to buy or sell a house. WeWork, a startup that provides shared workspaces is using artificial intelligence to design its office spaces. Skyline, an Israeli company’s artificial intelligence platform recommends properties to real estate investors by using data from more than 130 sources and taking into account over 10,000 different attributes on properties.
The outbreak of Coronavirus disease (COVID-19) has acted as a massive restraint on the real estate agency and brokerage market in 2020 as the need for services offered by these establishments declined due to lockdowns imposed by governments globally. COVID 19 is an infectious disease with flu-like symptoms including fever, cough, and difficulty in breathing. The virus was first identified in 2019 in Wuhan, Hubei province of the People’s Republic of China and spread globally including Western Europe, North America and Asia. Steps by national governments to contain the transmission have resulted in a decline in economic activity with countries entering a state of ’lock down’ and the outbreak is expected to continue to have a negative impact on businesses throughout 2020 and into 2021. However, it is expected that the real estate agency and brokerage market will recover from the shock across the forecast period as it is a ’black swan’ event and not related to ongoing or fundamental weaknesses in the market or the global economy.
Economic growth and a rapidly growing urban population is expected to increase the demand for residential and commercial buildings brokers, during the forecast period. The increasing number of rural residents migrating into cities is resulting in increasing demand for access to affordable housing and commercial spaces. This provides a significant opportunity for real estate service providers to improve housing, retail and other commercial services. Globally, around 60% of urban settlements remained to be built. According to the World Bank, the urban population in South Asia is expected to grow by 250 million by 2030. This rapid urbanization is expected to boost the demand for real estate agencies and brokers and drive the real estate agency and brokerage market going forward.
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