Can real estate agents take on a market leading property portal - and win? That’s the question Australian agents have been asking themselves recently after a movement known as “Project Rebellion” became front page news.
The controversy started a few weeks ago, when The Australian Financial Review ran an article titled “Real Estate Agents Revolt” on page one. “For too long agents have simply allowed their information to be used by other commercial operators at no charge and been put in the stupid position of having to buy it back,” the article quoted David Airey, president of the Real Estate Institute of Australia, as saying.
Airley explained that the target of “Project Rebellion” is the REA Group, operator of top Australian property portal realestate.com.au. Facing rising costs, agencies such as Century 21, LJ Hooker and Ray White are reportedly considering withholding part of their listing data from realestate.com.au in an effort to weaken the portal’s grip on the marketplace.
“The drought of sold data would certainly have some sort of effect on future revenue streams and to a certain extent current products but a successful ACCC action and a industry controlled competitor together would provide bad news for Australia’s largest and most successful real estate portal,” writes Glenn Batten on business2.com.au.
Property Ad Guru publisher Simon Baker - who was CEO and managing director of the REA Group between 2001 and 2008 - takes an in-depth look at the idea of an agent revolt against REA Group here. “Overall, while many industry players have aspirations to knock of the market leader, the reality is that it is very hard, almost impossible to do so,” Baker says. “The best they can hope for is to put pressure on the market leader to reduce the speed of the price increases.”
Do you agree with this take, or do you think REA Group should be worried? Let us know in our comments below.
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It seems to me that agents would not want to shoot themselves in the foot. The importance of REA to them is the massive readership the portal has…..and each of those readers is a potential buyer or vendor.
I imagine that few vendors would thank an agent, who is representing their property to the market, for downgrading the information to a site which has a greater number of visitors to it than all of the other sites in the market combined.
Nor would buyers be pleased to be redirected to a myriad of other web pages. Imagine a buyer session where they are constantly having to go to other web pages multiple times.
Agents may also provoke a retaliation from REA if it became a real donnybrook!
e.g. the links to agent pages where all of the agents properties are listed may no longer be available.
Links to agent websites may be switched off.
Links to the sales agent and their contact phone number may be cut.
Information collected by the REA site regarding the number of times the listing has been viewed and other information important to the selling agent to keep the vendor informed may not be available.
Finally, would the Real Estate industry want a fight about pricing and costs, with the ensuing investigation as to how they apply their cost recovery from the vendor?
My bet is that cooler heads will prevail. The cost per listing that they are being so vocal about is less than 1 percent of what it costs to advertise in print.
If you don’t believe that, ask your local paper what they would charge to advertise a property in a full colour presentation, full page, in every edition until the property was sold. Oh, then tag it as ‘sold’ and leave it there for another twelve weeks.
My suggestion to Mr Airey is that instead of setting up a modern day Eureka Stockade he should undertake an in depth look at what advantages his membership currently enjoys and does his best to negotiate with their partner in marketing, REA.