Loud complaints from real estate agents over Trade Me
Property's fee increases have been followed up with action.
Several agent offices have withdrawn their listings in the
last few weeks.
Craigs Investment Partners broker Chris Timms said while the
boycott was small at present, there was a risk it would
spread further. He downgraded Trade Me to a hold, with a
price target of $4.45 a share, down from $4.81. The shares
had traded in a 12-month range of $5.43-$3.96.
''In our last update in November, we noted the real estate
agent industry had become more belligerent by poaching
Brendan Skipper, then head of Trade Me Property, to lead
industry-owned portal realestate.co.nz. More recently, we
note some agents have been actively encouraging visitors to
open homes to use realestate.co.nz.''
Realestate.co.nz had since launched an advertising campaign.
Several agent offices in Hamilton and Hawkes Bay had removed
listings and there had been scattered removals elsewhere in
New Zealand, he said. The agent boycott of Trade Me to date
was small and fewer real estate agents had joined than had
publicly threatened last year. Trade Me was removing the cap
on fees and moving to a pure fee-per-listing model for
agents, as it already had for private sellers, Mr Timms said.
The average listing fee increased to $159 in November for
independent agents, which accounted for about 25,000 listings
of the 145,000 in total.
Trade Me's agreement with the large national franchises -
including Barfoot & Thompson, Harcourts, Baileys, Ray
White and LJ Hooker - which accounted for a further 105,000
listings, would all expire by the end of the year, including
several in the next few months.
Trade Me was seeking to progressively renegotiate terms, he
said. The remaining 15,000 of listings were from private
sellers which were charged between $349 and $399, depending
on the value of the property.
Trade Me had entered the negotiations in a ''very strong
position''. A listing on Trade Me Property was now an
essential part of any real estate marketing campaign and Mr
Timms believed Trade Me's current average yield per agent
listing was low relative to the value it delivered.
Trade Me generated nearly half of all house buying leads in
New Zealand but only had 10% share of real estate agent
marketing spend and, if private sellers were included where
Trade Me had a 50% market share of spend, a 13% share of
total real estate marketing spend. By comparison, in
Australia, online portals already accounted for 50% of total
real estate advertisement spending.