Wall Street Journal: Russell Simpson Support OnTheMarket
- By Adam Foster
- 12 August 2015
U.K. estate agents have been returning to Internet home-search firm Zoopla Property Group PLC, the latest turn in a battle for Britain’s online house hunters.
Zoopla reported Wednesday that the number of agents listing homes on its website rose since April by 213 to 12,556.
Just six months ago, Zoopla had more than 16,000 agents advertising homes on its website. The figure dropped precipitously when a group of estate agents, frustrated with paying fees to Zoopla and rival portal and market leader Rightmove PLC to advertise properties online, launched rival website OnTheMarket in January.
Membership of OnTheMarket came with a rule: agents had to pick between either Zoopla or Rightmove. Most ditched Zoopla. But now some of those agents appear to be moving back.
Although it is not clear that Wednesday’s figures are driven by agents returning to Zoopla from OnTheMarket, or just growth in the broader market, “this nevertheless compares favorably with our 12,549 year-end forecast and should be taken well,” said analysts at Citi. Zoopla shares rose 10 pence, or 4.1%, to 265 pence.
In the 12 months, “we expect many of the 3,000 or so Zoopla leavers to return,” saidAnthony Codling, analyst at Jefferies International Ltd., in a note to investors.
A major challenge for OnTheMarket, run by Agents’ Mutual Ltd. has been to build an audience. OnTheMarket had around 5.2 million visits from house hunters in July, according to the firm.
Zoopla reported average monthly visits of 45.6 million from April through July. Rightmove remains far and away the market leader, with an average of 110 million visits a month in the first half of the year, it said.
Pastor Real Estate, an agency focused on London’s ritzy Mayfair neighborhood, signed up for a one-year membership with OneTheMarket in January. Breaking from the norm, it opted to stick with Zoopla and ditch Rightmove.
But at its six-month break clause in July, Pastor quit OnTheMarket, from which “we only received approximately half a dozen enquiries which lead to actual registration of an applicant, none of which resulted in a sale or letting,” said Susan Cohen, head of sales and lettings at Pastor.
Many analysts are betting that Ms. Cohen’s view is indicative of the wider market, meaning Zoopla will retain its number-two position. OnTheMarket “is unlikely to work over time,” said UBS analyst Mark Fielding in a recent note to investors.
OnTheMarket “is obviously not performing particularly well…those agents who are participating in it are being hurt as a result,” said Alex Chesterman, Zoopla chief executive, in a call with journalists.
OnTheMarket didn’t immediately respond to requests for comment.
Some analysts are still wary of the threat OnTheMarket poses. The newcomer “is not going away quickly,” said Jonathan Helliwell, analyst at Panmure Gordon.
Russell Simpson, a high-end London estate agent, signed up with OnTheMarket in January. The group “is still very much in the early stages in its development,” said Jake Russell, a director at Russell Simpson.
But Mr. Russell isn’t planning to quit. “We fully support the concept and believe that it will continue to gather momentum,” he said.