Features

Australian Online Residential Property Ad Market

By Simon Baker 0 Comments NEWS, Features

The Australian online residential real estate market is dominated by one player - realestate.com.au.  Since September 2000, realestate.com.au has been the most popular site in the country with domain.com.au consistently in second place.

realestate.com.au's dominance of the Australian market can be seen in the following facts:

  • An estimated 95% of Australian real estate offices advertise on realestate.com.au
  • Over 70% of people visiting Australia residential real estate sites visit realestate.com.au - second place domain.com.au has only 32% of visitors coming to its site
  • 72% of the Australia residential property portal page impressions go to realestate.com.au - second place domain.com.au accounts for 21% of page impressions
  • 71% of the total session minutes spent on Australia residential real estate portals is spent on realestate.com.au - second place domain.com.au accounts for 17% of session minutes
  • An estimated 60% of the spend of real estate offices on online advertising is placed with realestate.com.au - second place domain.com.au accounts for only 25% of the total spend

Over the years a number of new entrants have entered the market and each time they have failed.  The market is clearly a 2 player market with realestate.com.au being the leader and very profitable (51% EBITDA margin) while the number 2 player (domain.com.au) is estimated to achieves a 5 - 15% EBITDA margin.

Spend on Online Residential Advertising

Online advertising covers advertising by real estate offices on portal sites, the franchise group sites, SEM (Search Engine Marketing) and their own sites (web development).

Over the last 8 years, the online real estate advertising market (residential + commercial) has grown quite quickly.

$m FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008
Est Market Size ($m) 12 17 25 40 63 95 141 195
Year / Year Growth   39.9% 44.8% 61.3% 56.9% 51.4% 48.0% 38.6%

 

It is estimated that the total spend on online advertising was just under $200m in FY 2008.  Of this, residential online advertising captured around 90% - or $180m while commercial online advertising captured $20m.  The total advertising market for print and online is estimated to be around $1bn in FY 2008.

What is interesting, is that the REA Group, through its Australian operations (realestate.com.au, realcommerical.com.au and Web Design Services) is estimated to capture around 60% of the total spend.

Residential Offices Est. Total % Total Portal Ads Web Design SEM/SEO
REA 107.6 60.4% 104.6 3.0 0.0
DOM 45.0 25.3% 45.0 0.0 0.0
Other 25.5 14.3% 10.0 12.8 2.7
Total 178.1 100.0% 159.6 15.8 2.7
Commercial Offices Est. Total % Total Portal Ads Web Design SEM/SEO
REA 10.1 60.5% 9.6 0.5 0.0
DOM 3.0 18.0% 3.0 0.0 0.0
Other 3.6 21.6% 0.0 3.0 0.6
Total 16.7 100.0% 12.6 3.5 0.6
Total Online Ad Spent Est. Total % Total Portal Ads Web Design SEM/SEO
REA 117.7 60.4% 114.2 3.5 0.0
DOM 48.0 24.6% 48.0 0.0 0.0
Other 29.1 14.9% 10.0 15.8 3.3
Total 194.8 100.0% 172.2 19.3 3.3

Residential Portal Sites

Nielsen Netratings provides good coverage of the residential portal sites in Australia.  There are two major players - realestate.com.au and domain.com.au and a number of smaller players.  In July 2008, Nielsen Netratings tracked 12 sites. These sites are:

 Name   Publisher   UB   PI   TT ('000 secs) 
Market Aggregate   5,292,483 693,668,860 10,449,801
realestate.com.au realestate.com.au Ltd. 3,825,316 497,894,322 7,381,431
domain.com.au Fairfax Digital 1,683,560 144,157,609 1,821,332
homehound.com.au Homehound 366,280 7,637,753 162,940
realestateview.com.au realestateview.com.au Ltd 267,914 9,373,952 118,369
reiwa.com REIWA 141,086 6,284,299 250,661
myhome.com.au myhome.com.au Pty 113,261 1,450,788 57,451
property.com.au realestate.com.au Ltd. 42,554 775,405 29,267
aussiehome.com.au aussiehome.com Pty Ltd 20,619 431,062 15,175
justlisted.com.au Sensis 21,679 160,359 7,480
realestate.ozfreeonline.com Infodial 7,353 48,769 2,449
propertyfinda.com.au APN Online 3,262 29,873 1,904
domainprestige.com.au Fairfax Digital 3,884 56,766 1,096

Note: UB = unique browsers (akin to a visitor), PI = page impression, TT = total time on the site

In addition, there are a number of other smaller players not tracked by Nielsen Netratings.  They are:

  • hotproperties.com.au
  • privaterealestate.com.au
  • propertynow.com.au
  • realestatefind.com.au
  • realestateworld.com.au
  • real-estate-australia.com.au
  • yourestate.com.au

Source: REA Group FY 2008 Financial Reports, Nielsen NetRatings, PPW Analysis

Leave a comment

Your email address will not be published.