Home sales slump 'will shut down 4,000 estate agents'

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Predictions made by the biggest network of independent estat e agenc ies, Movewithus, estimates that around 4,000 of the country's 12,000 property businesses will shut by December.

The move will be direct result of the credit crunch, which experts predict will cause an estimated 45,000 repossessions, 20,000 job losses in the City of London and a rise in mortgage repayments for around three million households.

Robin King, director of Movewithus, said the current climate meant fewer people wanted to buy property, with firsttime buyers and families being squeezed out of the market altogether.

He added that estate agent closures would be "massive", after sales within his network dropped by between 30 and 50 per cent.

"People may not like estate agents but if they are doing well, everyone else is too. If no one is buying and selling, it is a sign that no one is making any money," he said.

Some estate agents have already started making redundancies and have closed some of their poorer performing offices.

New figures have revealed that dozens of staff have quit jobs at Foxtons, one of London's most lucrative property shops.

At least 63 staff left the company in February alone following poor sales figures. Just 8,444 houses were sold in December compared with 14,502 the year before, according to Land Registry figures. The drop means that estate agents who have grown accustomed to easy sales in the city are being forced to work harder for each deal or leave.

Foxtons - which employs 1,200 staff in 23 branches across the South-East - is not the only company to feel the pinch.

Hamptons International has been forced to play down recent rumours that it had applied to its bankers for an emergency £5million of funding due to plummeting sales.

The agency, which was bought by real estate company Emaar Properties for £82million in August 2006, said that Emaar would "continue to provide the financial funding and professional resource to extend Hamptons' global reach" and insisted that it was in a "strong position" to do so.