Real estate tech entrepreneur and business advisor Mike DelPrete has just released his '2017 Global Real Estate Portal Report', a 100+ slide presentation on the state of the industry. We chat with him briefly about why he put this report together and he shares some of his top insights.
What real estate portals did you cover, and why?
MDP: This report covers over a dozen of the leading real estate portals around the world. I wanted to focus on the portals where data was available so I could conduct an evidence-based analysis and comparison. Typically, data is only available for the big players.
MDP: For me, it is how varied the global market is. Real estate classifieds are big businesses, but no two portals look the same. There is quite a variety in how well each portal monetises its customer base, how profitable each is, and how quickly they are growing (see the following charts from the report).
I’m also personally fascinated by the variety of ancillary services on offer at the big portals. I believe Zillow, with its mortgage comparison business, and Zoopla, with its variety of comparison and switching services, are world leaders. But what most people don’t realise is that each is a volume game, relying on tens of millions of leads to make it a meaningful part of the business. The average revenue per lead is quite low.
MDP: Zoopla in the U.K., hands-down. It has spent over £450 million on seven acquisitions which will make up over 75 percent of group revenues in 2017. It has massively diversified away from a listing product to becoming a one-stop shop for estate agents and home buyers and sellers. It’s been an expensive journey for them, but the strategy is paying dividends.
Similarly, as a proportion of revenue, Zoopla has spent more than any other global portal (with the exception of Zillow’s massive merger with Trulia). This is really a result of being stuck as a runner-up to Rightmove in the U.K. market and needing new avenues for growth.