Is Australia’s real estate franchise sector quietly fading?

The latest research from eXp Australia suggests that the real estate franchise sector may be losing its long-held dominance, with recent performance pointing to a slowdown in growth momentum and increasing pressure on the traditional model.

The research by eXp Australia analysed IBISWorld data on the size of the real estate agency franchise sector, in order to understand how this segment of the market has evolved over time.

The research shows that the franchise sector declined by -12.9% in 2023 due to the COVID pandemic, before rebounding by 6.4% in 2024.

However, this recovery has already begun to lose momentum, with growth slowing to just 3.3% in 2025.

In fact, despite some more buoyant years, the average rate of annual growth over the last decade has sat at just 1.7%, highlighting the longer-term challenge facing the sector in building sustained momentum.

Despite this fractured performance, franchising has been the backbone of the real estate industry for decades, offering agents a combination of brand recognition, structure, and scale. However, the way in which agents operate, and what they expect from a brokerage, has fundamentally changed.

Today’s agents are more informed, more mobile, and more entrepreneurial, with access to tools, data, and marketing channels that were once controlled by large organisations. As a result, the value that traditionally sat within the franchise system has become increasingly decentralised.

At the same time, the cost structures that underpin many franchise models have remained largely unchanged, creating mounting pressure in a market where efficiency, flexibility, and speed are becoming increasingly important.

This is driving a broader shift across the industry, as agents look for models that allow them to scale their business without the constraints of physical infrastructure, layered management, and complex fee structures.

Head of eXp Australia, Mindy Powell-Hodges, commented:

“For a long time, the franchise model was the default path for agents, but that’s no longer the case.

Our analysis reflects what many in the industry have already come to accept - the franchise model is starting to fade out.

A pandemic induced contraction followed by a short-term rebound doesn’t change the underlying trajectory, which is that growth is becoming harder to sustain within traditional structures.

Agents today are more informed, more mobile, and more entrepreneurial. They’re building personal brands, leveraging technology, and asking better questions about how they scale their business.

The challenge for the franchise system is that it was built for a different era. What once created scale is now, in many cases, creating friction.

At eXp, we’ve been built around a different approach from the outset. By removing many of the traditional overheads and layers, we enable agents to operate in a way that is more aligned with how the industry is evolving.

That’s why we’re now seeing many of our competitors look to consolidate in order to innovate to keep pace with the changing landscape, rather than building that innovation from within.”