Jefferies is the latest City analyst to cast a verdict on the state of Britain's property portals, claiming OnTheMarket's delivery has not matched its rhetoric.
It has lifted Zoopla from a Hold to a Buy status and is keeping Rightmove on an Underperform status.
Last week, when shares in Rightmove and Zoopla saw substantial price gains, another firm of City analysts, UBS, said of the launch of OnTheMarket: With all the noise it caused, OTM's real impact on Rightmove has simply been to dilute the competition.
Now Jefferies has adopted a similar approach to the new portal saying in its spring report on the UK residential industry: We have been surprised by the strength of the war of words from the OTM camp. However, as equity analysts we have a preference for numbers over words and facts over opinions, both of which paint a pretty clear picture.
It goes on to say that since its launch, up to April 10, OTM has had 3.8m hits compared with 95.3m at Zoopla and then gives a detail critique of traffic figures.
Traffic has so far peaked at OTM in week 7 at 630,206 visits and has declined each week since then. In week 10, OTM had 349,613 hits, a fall of 45 per cent from the peak and a similar level to that of week 3.
Meanwhile, Zoopla has had over 9m hits in each of the 10 weeks since OTM's launch. This data suggests to us that the new portal is so far failing to gain any traction with consumers, despite the scale of its launch marketing campaign. The fall in traffic also suggests to us that homebuyers are visiting the site but, due to a lack of listings or a limited number of search features and research tools, are not returning.
It also gives a substantial breakdown of London listings on all three rival portals on the week beginning March 30. Jefferies' report says:
Across London, Rightmove has 72,572 for sale and rent, Zoopla 70,149 and OTM 19,080. For Rightmove the balance of properties is biased towards the sales market (54% of the total), whereas for Zoopla and OTM the split is much more even.
Since 26 January, the number of properties listed on Zoopla has declined by 3,840 (5.2%), two-thirds of this coming in the sales market. Over the same period, the number of properties listed on OTM has increased by 9,837 (+106%), 60% of the growth being concentrated in lettings properties.
Despite these trends, the number of properties listed on OTM is just 27% of that listed on Zoopla and 26% of that listed on Rightmove.
63% of OTM's properties are listed in five boroughs: Barnet, Camden, Hammersmith & Fulham, Kensington & Chelsea and Westminster. Westminster alone accounts for 26% of the total properties listed, which reflects the nature of the group's founding members, in our view. Even in OTM's strongest boroughs, the supply of homes for sale and rent lags that of both Rightmove and Zoopla.
Many of the figures for traffic cited by Jefferies are from an independent internet traffic monitor called Hitwise, which OTM has consistently suggested understates its traffic.
Jefferies says the wider UK residential industry is performing better than expected this spring. In summary it says: We upgrade our stance on the UK residential sector, raising seven stocks from Hold to Buy and three from Underperform to Hold. The latest data points to a stronger pre-election housing market than we had anticipated. Help to Buy has helped the new-build sector punch above its weight, lettings market growth has countered housing transaction weakness for the UK estate agents.
Comments
PeeBee The reason actual regulars in the actual world tend to stay loyal is about geography overcoming loyalty. If a popular barkeep opens next door a lot of the regulars go next door. In most professions you get a year to protect yourself from this kind of thing. Anyway it's interesting to have two pubs offering different beer, life would be boring if we all had to drink the same beer eh As it happens there are loads of property blogs and groups for estate agents and I welcome them all, I think variety and choice is a good thing. Sometimes because of the simple law of economics a monopoly will form and they tend to spoil things for everyone, that's why we have a monopolies commission. Cartels are not the answer either just another aberration. Democracy itself is notably imperfect as is the free market, they both work ok in theory but in practice it's all about the execution, about the checks and balances. I see myself as an open minded pretty benevolent kind of guy and though I do have strong opinions I rarely mount personal attacks unless provoked and even then I usually regret responding afterwards. The thing is, a lot of people have made the OTM thing personal, me included because of the way Mr Springett acted towards me, I should not have taken it to heart but my views on the subject would have been and still are the same. A lot of people are trying to attack the people at Zoopla, they are exaggerating all of Zoopla's faults in order to mindlessnessly carry out the orders of the bigger boys who told them it was a good idea. Irrespective of Roz EAT has been singled out by the OTM lot because OTM sponsored PIE, the parallel is exact. I am sure there has been and still is a co-ordinated boycott of this site by some of the more vociferous posters, you excepted. The thing is though EAT's traffic is growing, there is a new site in the offing and it will be tomorrow's posters, not yesterday's we really need to encourage. I know full well that when I am proven right about OTM Iwill get no apologies or satisfaction from the nay Sayers, actually they will resent me more. The thing is PeeBee, I may not be the brightest or the best but I'm not the worst or the stupidest either. It's all about trying to achieve a balance, trying to master ourselves, that's the real trick. Over and out, for now at least.
Yes it does - and at least I know [b]my [/b]place as [b]that[/b] pebble in [b]that[/b] tin can...
Mr Shinerock - " the regulars at the pub down the road were never ours, they were always hers and they were always going to follow her to the next Inn." Oh I'm sorry - I always thought that "the regulars" stayed with the Inn unless the new innkeepers proved to be... let's just say 'unworthy' of their custom. Silly me...
"...it's all about who is better at their job..." I refer you to the comment above and agree with you wholeheartedly.
Think its time to spice this up by laying bets on how long OTM has left - need a bookie !
Looks like the Agents Mutual sales reps have been busy on EAT today sticking up for their silly plan...
Jack, I know what my motives are, what are yours If you read my carefully crafted articles on Industry views they spell out my position very clearly. Your accusations are rude personal and inaccurate. If I thought OTM was a good thing all the money in the universe could not persuade me to run them down. Think carefully before you reply please
@Simon
Some would call it an advertising fee, others would call it an agents media/Simon Shinerock consultation fee. IE: Come to me Zoopla and I will use my contacts and my media organization as well as give you a strategy to stop this Agents Mutual thingy.
You'll never be content Simon, you don't know when to stop, havn't you got enough money!
One other thing, the regulars at the pub down the road were never ours, they were always hers and they were always going to follow her to the next Inn. I don't resent that, it's all about who is better at their job. For what it's worth I think this publication has done and is doing a fine job without her, if she had stayed it would have remained her voice not the voice of the industry.
How very original
Oh and by the way, a pebble in a tin can makes a lot of noise, just sayin
Thanks PeeBee, I trust I can count on your vote in the forthcoming election
Perhaps if OTM was an advertiser on here some of these stories would disappear - it's does seem to be a constant theme - time to read a different site
Oh, Mr Shinerock... I beg to differ.
The pub across the road has had THREE TIMES the number of pints pulled (posts) to yours so far today - and I'm only going off the new articles.
The [b]only[/b] thing that is being proven here is that you "honestly don't give a .....".
Thanks - we already knew - but 'the obvious' you have stated is formally acknowledged.
Is that all you got Jack I think you will find the pub over the road is sounding quieter by the day. You will also find that Z is an insignificant part of this publications revenue and always has been. The truth Jack, I don't think you want to know the truth, too disturbing for you but here it is anyway. The strongest survive Jack, the most adaptable to change, you can't uninvent the internet Jack, it's pointless trying. And really, if I've offended you or anyone else by my views, I honestly don't give a .....,
Most of the comments on this subject are from those who pose a question and then provide their own biased answers. Worse than useless!
However, OTM agents are not helping their cause or themselves because their individual 'high impact' local and internal office advertising of OTM is almost nil.
Time and the market will tell but for goodness sake help yourselves..
OTM It looks like their data is backing up what they needed the answer to be.
"Shout 'last orders' as loud as you want, Mr Shinerock - if all the old clientele are in the pub over the road you ain't gonna get anyone taking you up..."
Shhhh keep that quiet Mr Bee as otherwise Zoopla will want their advertising money back that they've paid to keep this publication afloat.
Shout 'last orders' as loud as you want, Mr Shinerock - if all the old clientele are in the pub over the road you ain't gonna get anyone taking you up...
Exactly, it's more to do with self-interest than anything else. They want to be the new RM, but they won't even get close to being the new Zoopla.
Haven't a few dozen already returned I know that doesn't fit your narrative, but unless I'm wrong that's what Zoopla was telling us the other day.
I can't help but make an observation, prior to their launch, an article like this would have excited an avalanche of comments flying to the defence of OTM, all I see now is tumbleweed. If any of you OTM'ers would like to give it your best shot as apologists I would be obliged and entertained
Notonthehighstreet- I wouldn't call adding new members every week 'falling apart at the seams', and with our OTM leads gradually increasing week on week, I would say they are performing at least adequately for the time being.
Of course there is room for improvement and more agents need to join, but they are doing better than many predicted (but also not quite as good as others predicted i'll admit).
The problem with OTM is their business objectives, be number 2 property portal Jan 2016,to build to become a credible alternative to the No.1 portal. The focus should be the portal users having a better experience, agents getting better leads.
Can OTM maintain their burn rate I personally think OTM will become more of niche property portal and not the mass market they had hoped.
A jefferies report and a vested interest report by Connells ...shock horror.
The problem Zoopla have is that the 5000 is not going down, the rest will inevitably follow.
OTM falling apart at the seams! Can't say I'll be shedding a tear at their inevitable demise.
If they hadn't been so anti-competition and anti-online agents (a backwards move if ever I saw one) then they might have made a better fist of it.
[quote]claiming OnTheMarkets delivery has not matched its rhetoric"[/quote]
Yep, pretty much. Sounds a bit like some of our politicians - promise the earth when none of the actual evidence seems to back this up. Brilliant.
I told you so! Actually the OTM debacle has barely started, it's attempt to un-invent the Internet is having the expected effect of supercharging online agent growth and accelerating the decline of the high St, well done guys, good job :)