Real estate agents planning rebellion against REA industry dominance

A group of real estate agencies is preparing to limit the amount of data they provide advertising giant REA Group and its property site realestate.com.au in order to have more control over payment terms.

But real estate classifieds veteran and former REA Group chief executive Simon Baker has dismissed the plan as “noise”.

According to Real Estate Industry of Australia president David Airey, “Project Rebellion” is being headed up by various real estate groups including the Professionals and Ray White in order to reduce their costs for online listings.

“I think the agents are starting to feel like they’re giving away the farm. The information has been essentially enslaved by realestate.com.au and to a lesser extent Domain.com.au, but realestate.com.au has been the main one here,” Airey says.

“As a lot of the agents would say, they’ve enslaved the industry because you can’t do without them.”

Airey’s comments coincide with a report in The Australian Financial Review this morning which claims groups including LJ Hooker, Ray White, Raine & Home and Century 21 are preparing to discuss how they can set up alternatives to REA Group.

Airey says a meeting set to take place in the next few weeks will see companies decide on their next course of action.

While real estate agents have long said they are unhappy with the high costs associated with putting data online through REA Group, alternative ventures to combat realestate.com.au have lacked momentum. Now, Airey says, that may change.

“The franchised groups and a few others are looking at restraining the flow of data. Agents will probably start to retain their own data and then release it to the institutes.

“You do have real estate institutes running web portals, information on sales, and so on. The aim is to start controlling their own data, and let’s say this is little footsteps of returning control to industry portals.”

This has happened before, however. Real estate companies have previously attempted to combat REA Group, but former chief executive Simon Baker says it’s incredibly difficult to do so.

“I would say the industry for many years has complained about pricing – it’s all too much, in their mind. But it’s okay to spend more than on print. So you always get this noise, and so I think it’s just that – noise.”

“You have to do a number of things here. You have to set up a website with an equivalent number of listings, because if you have less listings people aren’t going to visit your website.”

Then, he says, the site needs to create awareness, and then convince users they need to go to the new site instead of REA. Traffic is a huge issue, he says.  “Consumers need a reason to go from looking at REA to looking at your site.”

“Good luck at getting all those into place. You also have to get agents to stop dealing with REA. But you have to see a co-ordinated effort to change anything.”

Airey, however, remains positive.

“Previously when this has occurred everyone thinks, “Oh, it won’t happen.” But the biggest issue for agents is that their costs have blown out, and for the slightest thing you can be charged a large amount of money. Agents want more control.”