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Property portals ‘at saturation point and can only raise prices by so much’ – where do they go from here?


sancho panza

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sancho panza

What bubble?

 

Property Industry Eye 6/5/18

'The big property portals have reached saturation point – with no new customer agents to recruit.

The big property portals are also being warned that they can only raise prices by so much, and that as long as most of their income comes from agents paying to list, there is not much diversification.

In his latest report, expert Mike DelPrete says RIghtmove and Zoopla have taken completely opposite stances: Rightmove has stuck to the knitting, whereas Zoopla has gone for a ‘one stop shop’ diversification.

Delpret observes that ‘adjacent revenue streams’ are far less profitable than classified listings.

But he also credits Zoopla as being the ‘global leader’ in diversification.

He says its portal-only business accounts for 25% of revenues, and that ZPG has spent a lot on acquisitions, at £450m.

He says it has executed its strategy well.

Despite this, DelPrete thinks that “the verdict is still out on the synergy value”.

It is not, he says, what he would call a runaway cross-sell success. ZPG’s businesses include portals, utility switching, estate agents’ software, and more.'

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sancho panza
2 hours ago, spygirl said:

They either raise prices, screwing EAs.

Or go for more of the pie, screwing EAs.

Either way,it 's going to give me some simple pleasure watching

1) Letting agents lose revenue streams they can't replace

and/or

2) EA's engaging in metaphorical mutual throat slitting as they slash prices and cut payments to the likes of Rightmove.

 

Decl-no short position in RM ....yet....

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2 minutes ago, sancho panza said:

Either way,it 's going to give me some simple pleasure watching

1) Letting agents lose revenue streams they can't replace

and/or

2) EA's engaging in metaphorical mutual throat slitting as they slash prices and cut payments to the likes of Rightmove.

 

Decl-no short position in RM ....yet....

Mrs spys fellow teacher is married to an EA.

Nice but dim.

Social do.

He had a slow realisation when i pointed out the issue with purplr bricks is not the extra competition but accustoming punters to pay a fixed low fee up front to sell their house.

Purple brick etc can afford that as their running costs are low.

Bricks n mortar EA cannot.

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sancho panza
Just now, spygirl said:

Mrs spys fellow teacher is married to an EA.

Nice but dim.

Social do.

He had a slow realisation when i pointed out the issue with purplr bricks is not the extra competition but accustoming punters to pay a fixed low fee up front to sell their house.

Purple brick etc can afford that as their running costs are low.

Bricks n mortar EA cannot.

Good point,I hadn't looked at it that way.

Bricks n mortar EA's can compete if they don't have to pay any business rates or rent...............

Otherwise as you say they're toast

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