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Online agencies grab more market share in past four months says analyst

One of the world’s leading agency and PropTech analysts says the race is on for who comes second in the UK’s fast-growing online sector - but he insists Purplebricks is way ahead as number one. 

Mike DelPrete - former head of strategy at the property portal Trade Me in New Zealand and now a leading international real estate consultant - has analysed the UK online sector and says the question ‘who comes second?’ is wide open.

Using Rightmove listings, he says that behind Purplebricks both Yopa and Emoov have seen strong gains, followed by Tepilo; but he says “HouseSimple is going backwards.”

In his latest analysis DelPrete says: “Yopa and eMoov raised a lot of new capital and are deploying it in sustained marketing campaigns. While Tepilo hasn't raised money, it has significantly increased its marketing spend. And HouseSimple's new chief executive pulled its marketing spend before a product relaunch.”

He says the conclusion he draws is not rocket science. “The correlation here is clear: the more money spent on marketing, the more new listings.”

Looking at listings stats, DelPrete says that - as of last weekend - Purplebricks, Yopa, Tepilo, Emoov and HouseSimple have gained 32 per cent listings since January.

Critically, he says that in addition they are increasing their collective share of the entire market. 

“They're not taking market share from each other; they're taking it from the incumbents ... While the online agents are clearly competing with each other, the real loser in this fight is the traditional estate agent” he claims.

Specifically, he says new listings market share for the online agents in the UK is up from 5.7 per cent in January to 7.1 per cent last month. In that same period of time, the leader Purplebricks increased its market share from 4.0 per cent to 4.5 per cent.

DelPrete says: “The time period is small - four months - so take it with a grain of salt. Plus these figures are based on new listings, not sales. But the story is clear: the online agent market segment is growing.”

In addition he says that the all-conquering Purplebricks in April had 6.7 times the number of new listings of its nearest online competitor, and 3.3 times the number of new listings of its top four online competitors combined.

He also says that because of its scale, and relatively low expenses on a per customer basis, it’s probably the only profitable online agent.

He ends his analysis with this question: “The race for second place is on, with several players raising and spending tens-of-millions of pounds in the market. And there is clearly room to grow market share at the expense of traditional agents. But can they make money, or is it an expensive race to the bottom?”

  • Chris Arnold

    In this race to the bottom, there's a danger that you might win. Or worse, come second. - Seth Godin

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