The new realestate.com.au website rolled out in April this year. Reception by the industry was pretty mixed and there was certainly many people at either end of the spectrum.
There was a bunch of issues at launch but most were sorted out fairly quickly. There is however a big problem that still plagues the portal today and that relates to the email updates and ebrochures.
I personally have a range of email alerts set for different combinations of streets but I keep getting emails for all properties right across the suburb for each alert no matter where they are located. This means I am getting 4 or 5 alerts for the same property but I am yet to receive a single ebrochure to match any of those alerts.
Now in the members administration dashboard we have our first notice that the prices are on the rise again starting from the 1st of August. No details have emerged yet on just what the price rise will apply to and what the rises will be.
So do you believe that realestate.com.au can warrant a price rise right now given the massive drop in property views?
After getting a fantastic result when asking for agents to send in their traffic results for their accounts I was able to compare rural, suburban and metro agents right across Australia in all states and not a single agent received higher property views from the day of the change over. In fact many reported Domain and Realestateview providing more enquries than realestate.com.au for the first time ever.
The new design itself also quickly revealed itself as another way to extract a greater “share of wallet”. A term that seems to be trotted out with more and more regularity. The old Guaranteed Top Spot was pushed off to the side and now more than one property can access this upgrade. Of course this caused a few hiccups and agents had to be compensated for the change of position. The top dog now at the top of the results list is the Premier Property option which is a brand spanking new uber-expensive add-on.
So with the new site not being as popular as realestate.com.au would have hoped for, more and more add on products to compete with, continuing email and ebrochure problems and reduced property views this new round of price rises will no doubt be a painful pill for many to swallow.
Will we all just pay the increase because we have to?
Will the emergence of a possible Industry owned portal allow agents to consider opting out of realestate.com.au?
or Will no serious challengers arrive and despite their cost realestate.com.au continue to provide the best ROI?
31 Comments
Craig
While REA are the dominant portal they will continue to increase prices and only when they feel threatened in the market will it stop (maybe). While they may hear the agents complaints it doesn’t mean they are listening. The sooner agents get behind realestateview, Google and Nestoria the sooner REA will start to feel some heat.
Peter Ricci
Realestate.com.au will continue with price rises (which is their right) as long as real estate agents depend on them.
Then again, realestate.com.au might be announcing a reduction Glenn?
Andrew Robertson
If you have ever tried to view a property floor plan in the new format you’ll understand why customers are leaving in droves! A ridiculous size given with an idiotic button in the middle that is hard to shift. Why cant we see a full page.
Realestate.com.au obviously don’t care as it has taken us 4 weeks to get any response to email queries and we are still waiting on others.
Glenn Batten
Andrew,
Thats one of the big reasons that agents are gonna get really pissed off with this price rise. They have found enough time to ramp prices again yet they cant get the delivery of enquiries and email alerts right.
Glenn Batten
Peter,
Of course every business has a right to increase their charges. No question about this but look at the price rises on just feature property add ons.
August 2008 $75
December 2009 $105
Today $115
August 2010 $125? maybe more
What have your prices done over the same period?
The point is if agents think that those sort of price rises are fair and warranted.
Looking at it from REA’s perspective it seems more and more feature properties are being sold. Demand is up so they can justify these sort of price rises as agents pay it. They may not like it but they are paying it.
I understand but dont necessarily agree with the argument that realestate.com.au about getting the vendor to pay for it and what does the price matter to the agent. That all sounds great in theory but not all of us operate in prestige areas with premium priced properties that have bank accounts over flowing with money to pay for ever increasing portal advertising.
$115 for a seller of a $1m property is peanuts. But somebody living in a small unit or townhouse that is struggling to pay the mortgage that is small fortune right now.
Have you seen what they charge for Premier Property?
Chris Wilkins
Domain.com.au outstrips REA here in Sydney for us some 4-1. REA’s service is non existent and i tell everyone to use domain or Ray White
They have no idea and i dont believe i would see any difference in my buisiness if i stopped using them which is an option
Greg Vincent
Glenn, there are lots of instances where internet services get cheaper & cheaper as time goes on, maybe the price changes in August could mean that REA are going to reduce their pricing because of the reduction in visitors, the email stuff ups and those legendary HouseHunter videos? Yeah right!!!
I understand that they have a responsibility to their shareholders & want a larger share of wallet, but if REA go down the path of increases right now it will be short term gain but LONG TERM PAIN as other options will grow in popularity.
In recent times both Domain & REA have been doing things that have only opened the doors for the National Industry Based solution RealEstateView.com.au & PropertyData.com.au.
The alarm bells are ringing for you REA. Before rolling out an increases in August you may want to have a serious re-think.
Sal Espro
Peter, I just stumbled upon this article by Glenn. It’s not listed in your ‘recent articles’ section. Ps My guess is REA will ream past the pain and then offer a sweetener of some sort. Classic marketing.
Glenn Batten
Sal,
there seemed to be a little bit of a hiccup there for some reason. For some reason the article went back into draft status which is why it and the comments that had already been post could not be seen…. Dont know what the problem was and how it was fixed.. but all is right with the world again 🙂
Nick
If it was a price reduction, they would be shouting about how they are providing better value to agents, so dont get your hopes up. :p
Judging from the vague wording, they are just giving warning for the new prices as they probably legally need to (30 days notice at least?).
Greg
Unfortunatley REA is in the spiral that alot of public comapnies find themselves in and in the end there will be no joy for the agents. I can remember when REA shares were trading at15cents – today the shares are trading around $10.40. What this means is that the number crunchers in the back room push for increase revenue to keep the dividends up. Price risers is not only what happens when share prices rise. To keep revenue up they also look at costs so areas like middle management are examined and in many cases cut which means less servise for the customer. This is all ready evident with Hub on Line. If anyone is using this sytem I am sure you will find that customer response by the company is terrible and getting worse as each week goes by. I have been informed that Hub on Line has now only two customer service officers for Australia. As the share price rises – prices will increase and service drops, it is just the way it is.
Glenn Rogers
Now who was it that was questioning the need for an industry portal ?
Ryan O'Grady
Sorry for the interruption and multiple email alerts. It appears one of the updates the other day caused an overload on Apache. In our testing we had to withdraw the post and then publish again (twice to be exact).
Thanks for the alert Glenn, Greg and Robert.
Greg Vincent
Glenn, I wonder if the REA sales team are getting a pay increase because they are going to cop a pounding from the agents & franchise groups about this.
I’m sure some of their sales team would be starting to feel a bit disillusioned about the whole thing.
The past few weeks of putting out fires would have been pretty full on for some of their sales team and now they are just about to be sent back out into the lion’s den all over again.
From this article http://www1.propertyportalwatch.com/2010/06/rea-loses-another-staff-member/ it seems that they’ve had their fair share of key personnel leaving the company recently.
Peter Ricci
I am not trying to justify price increases by REA, but they are a profit making company and their avenues for margins are really only in a few markets now, so they will try to capitalise where they can.
As for feature properties, who is selling these? Put them as a feature on your home page and save them the money.
I dont know how many times I have said this, but you should get communities of agents together once a month and pressure these portals as a group.
Complaining on your own is useless. Give yourself some power and they will yield.
PaulD
Peter,
You’ve got that right. I couldn’t count the times I have heard agents complain about price rises, and when they are given an opportunity to do something about it, — they don’t make a change. What was that definition of insanity again ?
Glenn Batten
PaulD
There is not too many agents who complain about any price rise. It’s more about the actual size and percentages of the price rises. Go and graph cpi increases for the past 10 years against REA subscription and add on prices.
But the real issue now is that they still have some major problems relating to email enquries, ebrochures and email alerts that have not been sorted.
Considering that all three of this directly effect the ROI of the portal to agents I think it totally understandable that agents would be unimpressed.
Expecting agents to band together to create a bargaining collective is great in theory but it is never going to work. That concept is fine when there is only a few clients but there are around 10,000 agents. REA wont feel any pressure even if we could get all Nerang agents to band together.
It needs to represent a larger percentage base of their clients before any pressure could be applied. There is always going to be a few who will stand alone so as to provide a point of difference. The best way to place pressure on portal subscription prices is through competition and for my mind the best opportunity right now is an industry owned national portal which realestateview threatens to be.
Realestateview may never rise to be number one but a cost effective portal with the support of the industry should provide enough choice to keep prices climbing 5 to 10 times that of the CPI. If we dont, given the growth of prices from REA in the past 5 years who wants to predict what price a feature property or what price a monthly subscription will be in 5 years?
Peter,
Feature properties are becoming very popular. I can’t understand it myself but the add on products like feature all have become a defacto super premium subscription. In popular suburbs this has become a real problem. If you go to Surfers Paradise the first 9 pages are only feature properties. So if an agent lists a property in surfers without being a feature property it starts on page 9 from day one and goes back from there.
The default sort of “Most Relevant” is a complete joke. Most relevant is feature property’s first then non feature properties. How this sorting method is “most relevant” to a buyer is beyond me.
Glenn Batten
Further to the whole issue of collective bargaining. The one thing that may work is the major real estate groups getting together. Ideally they could also include some of the independent agent networks and some of the smaller groups as well.
The outrage by the groups over things like the House Hunter videos got an immediate effect.
I dont think organising individual agents has any chance of success.. but doing it at a group level might get the legs.
Trevor
Having been at a meeting where approxiately 50 agents confronted REA reps about some of the issues that need to be addressed, I can tell you they just don’t want to know about the problems agents are having. But here is a small exercise I often carry out and suggest you try the same thing in your area because this is one of the issues REA will not address. I select a suburb in my area that contains a mixture of established housing and new homes (ie house and land packages). REA have a “new house and land package” button under their Build tab, however they also include these same house and land package listings under the Buy tab so when you carry out a search for an established home you will also get the duplicated house and land package listings that appear in the Build search.
In my example I searched all houses on the Buy tab in a particular suburb and the search returned 155 listings. I then carried out a search in the new house and land section for the same suburb which returned 65 house and land package listings which shows by deduction 42% of the listings in the established home search were duplicated house and land package listings. But what really upsets agents in our area is that when you scroll through the listings as in this case, on the first page of 20 listings only 3 were agents listings with the remainder were listings of major building companies; the second page had 4 agents listings and the third page had 9 agents listings, ie in the first 60 listings only 16 belonged to subscribing agents!
However what I am uncertain about and maybe someone can answer is whether in fact REA count the duplicated listings as one listing or two listings because based on my example for this particular suburb if they were counting the listings twice they would be overstating the number of listings on their portal by 42%. Not only this, it would also be reasonable to assume that the duplicated listings are adding to their traffic count as buyers click through to the listings just because they come up in a search even though they weren’t searching for a new house and land package. This clearly disadvantages agents as their listings are now being intermingled with new house and land packages and agents listings are being pushed further down the search results page. This is hardly fair to agents and fantastic for the building companies, but then fairness to agents doesn’t seem to be that important to REA.
Marmellows are yummy
I am an agent – 10 years in the game. Just going out on my own. If I had a choice I would go with REA. just got their price sheet! about $350 per calendar month. I thinks its worth a fixed fee of about $35 a month.
So I wont be using it. At the moment!
Vic
All the more reason for agents to now consider their options and go for the quality “free to list” portals be they total property or niche market sites. Examples of some new entrants making a mark are My Home in the total property section and Million plus and Waterside Property Sales in the Niche Market area.
These give real cost effective choice to agents, whilst adding to the exposure and catering for a more targeted markets. All agents as part of their marketing strategy should consider listing with them whilst rationalising their use of pay to list site over time.
In due course they might be surprised at the “real” value they will get from only listing with free portal sites.
Vic
All the more reason for agents to now consider their options and go for the quality “free to list” portals be they total property or niche market sites. Examples of some new entrants making a mark are My Home in the total property section and Million plus and Waterside Property Sales in the Niche Market area.
These give real cost effective choice to agents, whilst adding to the exposure and catering for more targeted markets. All agents as part of their marketing strategy should consider listing with them whilst rationalising their use of pay to list site over time.
In due course they might be surprised at the “real” value they will get from only listing with free portal sites.
Glenn Batten
OK.. Feature properties have now increased from $115 to $186 per month
Thats a massive 61% price increase.
What I am most surprised about is the push to get agents on the feature all option where you will be paying well over $120 per property. For our agency if we kept every listing we have as a feature property all the time it would represent about $140,000 per year.
As you can imagine the Account Managers are being battered black and blue on the front line as they educate the industry on these price rises.
Kon
Whilst realestate.com.au is the dominant player,of a duopoly,they will continue to be at it!Their pricing structure, is contrary to the world wide
trend of “free to list” RE portals.
Malcolm Brown
I believe necessity is the mother of all invention / creation, based on this I expect that when the majority are fed up with the continual price increases a Free Online portal will be available.
I would not hesitate to support another company as our problem in Qld is REA has no competition at the moment
We must see change & we must see it soon !
Greg Vincent
Speaking of FREE, have you seen this? http://video.thehomepage.com.au/
Glenn Batten
Yes.. funnily enough someone posted it to the Realestate.com.au facebook page yestwhich has triggered a poll by realestate.com.au to see if users want posts by third party companies removed.. all very funny 🙂
http://www.facebook.com/realestateAus
Realestate.com.au have let it get out of control and everybody is using it to post their business on…. now even the opposition
Sal Espro
Bloody funny video *L* (Don’t think much of the site its advertising tho – Who is funding all of these portals? Surely it’s good money after bad!)
Ps How do you post on REA’s facebook/any facebook? There doesn’t seem to be a link e.g. Under that homepage post…?
Perhaps they have put up a ‘read-only’ barrier to too old an’ gnarly types like me! 🙂
Mac
Further to a post on REA’s facebook, I know of a buyer whose REA alerts stopped after the relaunch!
Does anyone else think that from a buyer’s perspective alerts in general are very tedious? e.g. It’s not unusual for a buyer to register with a few agencies as well as the major portals? Isn’t this inefficient apart from the alerts being delivered in so many different formats…? How do you keep track of the ones you like if they’re all on different systems? etc etc
Linda
Hi Glenn
I note your comment: ‘After getting a fantastic result when asking for agents to send in their traffic results for their accounts I was able to compare rural, suburban and metro agents right across Australia in all states and not a single agent received higher property views from the day of the change over.’
We are currently having hassles with Real Estate Com and doing some number crunching on whether it is worth staying on board. As we are a rural agent I would really interested in knowing what you learnt about rural agencies and how their stats rated. Our stats are not great – even harder to understand now and the figures spouted at us by REC do not match ours.
This is compounded by REC wanting us to pay subscription for each office (a number within) same postcode while others have one office that spans 110’s of k’s. What’s to stop an agent having a vitual office that lists all the properties? According to REC that would be one office. A very weird way of calculating subs and for small rural agents a fast way to go broke on marketing that may or may not deliver results – and certainly REC do not make it easy to find out whether those results are actually happening.
Any info you provide would be helpful.
Thanks!
James
When searching for properties, Use the domain.com app which makes it easy to see which ones are for sale in the streets I invest in. Realestate.com.au rarely has properties domain doesn’t have, so I only check it occasionally. My understanding is domain is dominant in nsw. Realestate.com.au should just copy the domain app, onthehouse.com did and doesn’t seem to be facing copyright problems.