Real estate brokerages lay off employees to survive

By Anh Tu, Ngoc Diem   June 25, 2023 | 03:15 pm PT
Real estate brokerages lay off employees to survive
Buildings in Ho Chi Minh City. Photo by VnExpress/Quynh Tran
Property brokerages have been forced to sell assets like cars, reduce office size and payrolls and offer other services to remain afloat.

The Finance - Economics - Real Estate Institute belonging to Dat Xanh Services said brokerages have resorted to selling insurance, furniture and coffee, and leasing their offices to survive the market slump.

After nearly 10 years as a real estate broker, in 2019 Hoang Viet established his own company in Hanoi’s Ha Dong District.

It had more than 200 employees even in early 2022, but only 30 remain now after difficulties set in at the end of last year.

"Our company had to sell cars, return two-thirds of the premises to the landlord and lay off staff to minimize costs and pay bank interest," Viet said.

A real estate trading floor in Thanh Hoa Province said it has had zero revenues in recent months.Its staff started to quit en masse late last year, and the payroll has declined from nearly 100 to 16 now.

Le Dinh Chung, general director of SGO Homes Real Estate Investment and Development Joint Stock Company, said 70-80% of brokerages in the north have closed down for good or temporarily and the rest have downsized by 80-90%.

Medium-sized brokerages that used to have 100-200 employees currently have a dozen, he added.

Pham Thi Nguyen Thanh, general director of Dat Xanh Real Estate Services Joint Stock Company, said her company has downsized its brokerage department by 60% from 10,000 employees.

According to a report published in early June by the Vietnam Association of Realtors, over 95% of businesses have laid off people.

Some brokerages with less than 50 employees have had to terminate contracts with over 90% of their employees, only retaining key positions, and almost stop operations.

More than 90% of the firms reported a fall in earnings in the first quarter of this year. In the case of businesses with less than 100 employees, they were down by 70-80%.

A survey the association did recently found 23% of brokerages saying they could only operate until the end of the third quarter if the market continues to remain bad, and 43% saying they could survive until year-end.

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