One of the world’s leading property technology analysts says Purplebricks-style disruptive agencies will be a trend to look out for in 2018.
The forecast comes from Mike DelPrete, former head of strategy at the property portal Trade Me in New Zealand and now regarded as one of the leading PropTech analysts.
He says Purplebricks has created a business model that is “gaining traction globally” demonstrated by the hybrid agency’s fledgling activities in Australia and the US.
DelPrete says Opendoor - a US platform that claims to dramatically simplify house sales - is a similarly disruptive model that is troubling the traditional agencies in that country.
“How big will they get?” DelPrete asks, looking ahead to the influence of these two companies in 2018.
Another key trend he anticipates is in the world of property portals.
“Diversifying property portal revenues into adjacent services isn't easy. I'll be keeping an eye on who is expanding where, and how they're doing it” he says.
DelPrete has previously analysed, and praised, the way ZPG has used its Zoopla and PrimeLocation portals within a strategy of group diversification.
In 2014 the proportion of ZPG’s revenue from agents in return for advertising on its portals was around 75 per cent; now it is under 30 per cent, because of its diversification into other areas.
Earlier this year DelPrete produced a substantial report which shows that while Rightmove is very successfuly growing revenue through high-margin portal advertising products, ZPG’s revenue growth is from ancillary streams with lower profit margins.
DelPrete’s third trend to monitor in 2018 is Facebook’s likely entry into marketing homes for sale and to let. This will create new competition for portals such as Rightmove and ZPG in the UK and Zillow and Redfin in the US, he says.
“How will they react?” he asks.
Finally, DelPrete promises to open 2018 by releasing “a new, expansive report on the emerging models in real estate tech that are gaining traction globally”.
EAT will carry full details when it’s released.