Two of the biggest names in the world of property portals may join forces with the news that US firm Zillow wants to acquire one of its main competitors, Trulia.
Although not widely used in the UK, the fate of these two US firms may show ultimately how our domestic lettings and sales portals landscape may change in the years to come.
Zillow claims 83 million unique users per month across its internet and mobile sites while Trulia claims 54 million unique users monthly - critically, 50 per cent of Trulia users do not visit Zillow - meaning the combined site will see automatic user growth.
Like Zoopla and Rightmove, the two US sites list properties on sale and have mortgage and other ancillary service tools for buyers. Zillow has house price 'Zestimates' - not unlike, for example, Zoopla's price valuation tool.
Both of the US firms generate the majority of their revenue through advertising but Zillow claims that the companies' combined revenue is less than four percent of the total $12 billion spent by US realtors on marketing annually.
Both firms now have to sell their potential deal to competition regulators; if successful, the deal will see Zillow paying around $3.5 billion through stock payment.
In a bid to win support the firms say they will offer more data related to the US housing market with consumers and professionals at no charge.
Under the terms of the deal, Trulia shareholders will receive 0.444 shares of Zillow stock for ever Trulia share they own, giving those shareholders 33 per cent ownership of the combined firm. Zillow shareholders will own the remaining 67 per cent of the firm.
If the deal is approved by regulators it will take effect next year but the Zillow and Trulia brands will continue to have separate existences.
After the go-ahead for acquisition, the companies say they will integrate their systems to allow for multiple listing service listings across both sites, uploadable with a single click.
Is this the future in the UK too The Zillow-Trulia deal took only six weeks to negotiate and, if it happens, will see one company dominate online portal listings in the US.
Is it possible that one day, the current Big Two will be One
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Comments
Well at least Zoopla and Rightmove have potential working options to overcome Agents Mutual/On the Market if it takes off to the extent they are predicting they will. I strongly doubt they'll need a merger of any kind though especially since On the Market are refusing to advertise for Online Estate Agents.