The Australian Real Estate Portals Survey is now closed and the results are in. Overall we had over 500 people who viewed the survey and 92 participants complete it in full. None of the questions were compulsory and not every question was answered by everybody.
Several of the questions required choices to be selected against 16 real estate portals. I tried to include a collection from the subscription, free, state based and niche portals, specifically the luxury portals.
Performance
It’s probably no surprise to anyone but the portal with the overall best result on performance was realestate.com.au with less than 15% of people indicating they were dissatisfied by their performance and over 68% claiming they were satisfied or very satisfied with their performance. The small remainder had a neutral response.
In contrast Domain had a significantly larger 27% of people dissatisfied and a lower 40% satisfied. Still we are talking about performance here and Domain still delivers so all in all fairly good results in comparison to the rest of the portals. Domain Prestige on the other hand gave a pretty poor result. Despite the fact that only 20 people actually provided a rating only one person indicated they were satisfied by their performance.
Homehound and Myhome came in pretty similar with around 50 people providing a rating. Both have a few more people dissatisfied than they do satisfied but the most popular result response was in the middle with Neutral. I guess you can read into that they are doing an Ok job!
Google Real Estate had just 20% of participants indicate they were dissatisfied but a massive 37.5% indicated they were satisfied. That performance satisfaction rating was nearly as good as Domain’s and is really quite surprising. In just a few weeks I cant see how Google would be close to Domain on a performance level. Then you have the fact that Google just passes on the inquiry to their own website or one of the other portals so it would be pretty hard for the average agent to quantify the results from Google Real Estate.
Whilst the number of respondents for the two free luxury portals were a lot lower those that did respond did not find much to be satisifed about the performance in either Millionplus or Luxuryhomes.com.au. The three state based real estate portals provided a mixed bag of results. The number of respondents for each was naturally much lower but Realestateview.com.au was the standout performer followed by REIWA and a relatively poor results for realestateworld who struggled with only two people wishing to record satisfied results.
Value
The standout performer in this category was Google Real Estate with just 6% of those that answered the question saying they were dissatisfied and a leading 58% saying they were satisfied.
Realestate.com.au had 1 in 2 respondents indicate they were satisfied but with nearly 30% dissatisfied the results were fairly polarised.
Domain’s results confirm the trouble they are currently having in the marketplace at the moment with just as many dissatisfied with their value as there are those that are satisfied at just over 30% each.
Given their free base subscription levels it is probably no surprise that Myhome and Homehound showed just 8 to 10% dissatisfaction levels on a question based on value. There satisfaction levels were around 3 times that which left fairly large Neutral vote. Results not quite as good as newcomer Google but something they should both be happy with as the industry obviously sees them as a value proposition. They both just need to do something about their perceived performance.
Realestateview was the clear leader in the state based portals with nearly half those that gave a rating saying they were satisfied with the value of the portal in comparison to just 5 saying they were dissatisfied.
Subscription Plans
Of the three different suggestions the survey offered of Flat rate unlimited properties, price per property and price per enquiry, they all had their fans but it was the unlimited option that garnered the most support. Price per listing also had good support but I was surprised by more than 40% selecting “Strongly Disagree” for the “price per enquiry”.
Next 12 months
With the portal landscape in Australia entering a new phase and free options like Myhome, Homehound and Google starting to stack up and provide serious alternatives I thought it interesting to look at where the respondents see the future lies. There are a couple of standout messages from the results and the first one is not so good for Domain and to a much lesser extent realestate.com.au.
56 respondents indicated where their future lay with Domain and 10 of those, representing close to 1 in 5 said they will be cancelling their account. As the number two portal this has to be a very worrying indicator of a bad year to come for subscriber numbers. On top of this another 11 indicated they would be reducing their investment with the portal totally close to 40% reducing their investment or cancelling the portal totally.
Realestate.com.au also had 4 people indicate they would be cancelling their account but because they had a lot more respond in the survey which meant that it represented only a fraction of the cancellation rate of Domain at about 5%. What was particuarly high though was more than 25% of respondents indicating they would be reducing their investment in the portal. This is certainly better than the cancel rate experienced by Domain but indicates that the REA sales team is probably going to struggle to sell the add on features to the base subscription over the next 12 months.
Overall I think the top two subscription portals would not be too happy with those results. It seems to indicate that many agents are looking to reduce their expenditure to subscription portals. Those with two portal accounts seem likely to drop the second subscription and in most cases that is the domain account and a few agents seem to think they dont even need a subscription portal at all.
Other than these there were two other standouts. For Google Real Estate there is a strong indication that agents will increase their investment in the portal. On a state level despite reduced numbers of respondents RealEstateview.com.au showed a very high percentage indicating they would be increasing their investment. This is a great endorsement and something that they should be proud of.
For the rest… it was generally a matter of “No Change” that stood out.
Industry Trends
In a general sense the majority of respondents believe the trend for the next 2 years will result in a reduction of market share for the subscription portals in favour of the free portals and in particular to Google Real Estate. In fact a massive 85% of those who responded believe Google will increase their market share and only 1 person believed that they will decrease their market share… What was that person thinking?.. Was that you Simon? 🙂
The majority also believe that subscription costs will increase but their value to an agent will decrease. Another thing that really stood out in the results was the strong belief that Free Portal will become more effective over the next 2 years.
Percentage of Buyer and Appraisal Enquiry and Source of Sales from Portals.
The survey asked respondents what percentage of buyer enquiry did Real Estate Portals generate. The answers that could be selected were across 7 categories. Generally most people responded that real estate portals provided between 45% and 90% of all buyer enquiry. This was broken up into three categories covering 15% increments that returned 20. 25 and 30% of the. responses respectively. This really shows that there are some agents who rely very heavily on portals to deliver their buyer enquiry and just how economically tied to the performance of Real Estate Portals they have become.
Real Estate Portals were a lot less capable in generating appraisals with 31% responding 0 to 15% and 34% responding that the portals generated between 16 and 30%. That certainly represented the majority of respondents but again some agents indicated just how much they rely on the portals with nearly 11% suggesting that portals were responsible for over 60% of their appraisal enquiry.
Next we asked what percentage were the real estate portals responsible for sales in an agency and there was again 7 categories. This was really a mixed bag. Whilst 31-45% was the most popular category with over a quarter of the votes all other categories up to 90% received a significant response. Only one person indicated the 91-100% category. Whilst they are clearly a significant buyer source for just about every everyone the percentage of actual generated business really ranges quite significantly.
Quite clearly there are offices that through other initiatives have strong sources of buyer enquiries, appraisal enquiries sales such as emarketing, CRM and print advertising fully outside and away from the portals. For these agents the business traffic generated by portals is significant, but still only a part of their overall business. On the other hand there are offices that rely just about totally on the portals for all their business.
Real Estate Portal Issues.
Someone who chose to remain anonymous implied that because I asked about issues I was trying to skew results. I left these to the end of the survey so they played little effect to the survey responses. The issues raised were what I personally believe are the major issues today facing the industry relating to real estate portals. If the questions were skewed the results any then discussing the issues on sites like www.proptechnow.com.au would do even more so. Unfortunately its a case that if you want to see whats important you have to bring that to the fore.
Saying that, these things were clearly issues that concern many agents so as you would expect this was evidenced in the results.
The increase of subscription costs was nearly a clean sweep with around 85% of those that responded saying they were concerned or very concerned. In comparison only 52% of people were as concerned with the value of subscription portals decreasing.
The increasing add-on costs was also a concern with 72% claiming to be concerned or very concerned. The biggest single response was left for the matter of Private Sellers on Realestate.com.au where by a massive 57% of respondents indicated the single category of “Very Concerned”. When combined with the “concerned” response this means that nearly 7 in every 19 agents will be very displeased if RealEstate.com.au ever considers allowing private sellers to their site.
Over the past 12 months the changing economic situation has meant that the majority of agents have seen dramatic reduction in revenues whilst portal costs have increased significantly. Even a promoted price freeze was not really a freeze at all, merely a price cap and that cap had been increased inside the 12 month period anyway.
Google did not escape this category though with 1 in every 2 agents concerned about Google controlling real estate information online. Since Google only shows limited information provided by third parties and is about passing that traffic on to those that actually host that information I can only put this down to a lack of understanding how Google fits into the mix. They are a path not the destination so their control can only ever be limited and the concern in the industry is probably from a lack of communication. I think all they have done is one press release that never really made the papers whilst the media groups have released a us versus Google articles.
Overview
The market leader, realestate.com.au comes out pretty strong from the survey however there are messages loud and clear that they should be listening to. In short terms agents are concerned over some key issues and more importantly, agent believe that their current market position and value to an agency will erode over the next 12 and 24 months.
Domain on the other hand obviously has some problems to look at and they need to start thinking outside of the square and come up with something that changes their image in the market. Some good stuff has come out of there recently but this needs to continue to make a real impact.
Google is generally seen to be adding significantly to the industry over the next 12 and 24 months. They are the new kid on the block and because of their pedigree they are being given a remarkable amount of support from the industry. Time will tell if they live up to that support.
You can view the results page for the exact responses numbers for each question here http://bit.ly/zXY1h . As promised anybody who wants the raw data which provides a better detailed view of the responses needs to send me an email at glenn@nfn.com.au.
The survey resulted in quite a lot of comments so here is a small selection of them
“Realestate.com.au have too much power”
“I still believe these mediums are cheap considering the return. We carry a mix of approx 40 listings at any given time (Sales + Property Management) meaning each listing costs approx. $17 a month to advertise. Beats any alternative, and REA and Domain provide us with huge results. No complaints here…so long as the prices don’t skyrocket (thanks to Google, they shouldn’t) , we’ll stay on board.”
“Subscription costs are getting out of hand, need to ensure no private sellers allowed”
“realestate.com.au have been increasing their costs by large percentages each year – way above the CPI. They claim they are delivering more visitors but are individual agents receiving any more inquiry. Monopolies are not good, we have been down this path with newspapers which have had monopolies in cities and agents have no bargaining power on costs because there are no alternatives. We must keep portal competition alive and ensure there are enough major portals to keep prices fair.”
“With google coming in as a real player ,the power can be regained by agents as they are always the source of the primary content”
“REA is our standard portal. The costs are beginning to become inhibitive and we would welcome a less expensive yet effective alternative.”
‘Far too high subscriptions and no customer service. Agents are their customers but they don’t seem to see it that way”
“Cost – That being said, it is much cheaper that the old days when print ruled”
“They are completely over priced and the problem is you really dont have a choice but to use them”
“Portals play one agent off against the other for things such as “Guaranteed top stop””
“Subscriptions on the main portals are good value”
“I think Google shows alot of potential but was surprised that there were many glitches in it – hopefully that’s not a reflection of their commitment to make it excellent”
“To be blunt, i believe Domain sh*ts all over REA with regards to customer service, their site is cleaner, arguably more user friendly, and they don’t give everyone 5-10 FREE Feature Listings, so ours genuinely stand out on Domain. The other portals are non factors to us, as we don’t invest in them.”
“They are giving too much information to the public that we as agents provide after working extremely hard! We also pay them for the privilege.”
“if every portal and every property was listed the same way without any priority listings in date order the market would move a lot smoother and everyone would have a fairer go.”
“I think the real estate portals have a rough road ahead, some will survive, but many will fall by the way. We do, however, need some competition to keep the playing field level to some extent.”
“I have a growing concern that our industry will simply hand Google all our relevant information again on a FREE basis then head lock our industry – before charging us a fortune in 2 years time.”
“The dominance of REA the others need to get their act together. to many ads on their site, we are paying for the properties to go onto the site, no need for the ads all over the pages.”
“They are like the newspapers- the customer is unimportant and only there to be milked”
“RE portal owners see agents as a huge income source. They have done a fantastic snow job on the majority of ‘technically uneducated’ agents. Agents don’t appreciate by subscribing to these sites they are helping those sites grow and thus taking business away from those agents”
More Surveys?
If anybody is interested in assisting with further surveys over the next year I would be interested in talking with you.
My initial thoughts are that we would need the assistance on two levels:
- The first is wider audience. Ideally I would like to get a survey in front of a much wider audience to all agents and salespeople and someone that could assist in that would be appreciated.
- The second is financial. A higher featured survey system allowing for conditional questions, branching and break the survey into smaller sections. Also prizes for those that enter would increase the take-up rate.
I am open to assistance from anybody including industry magazines and even real estate portals. Whilst somebody might choose to sponsor a survey it would remain independent and as transparent as possible. I have a range of survey topics in mind including:
- Mobile technology looking at smartphones, mobile phones, laptops and tablets.
- Technology in the office looking at the number and type of computers, internet connection, network topology and ancillary equipment like printers etc.
- Print Advertising