Zoopla Digital merger would 'knock Rightmove into second place' on lettings
Thursday 8th March 2012
If the merger between the Digital Property Group’s portals and Zoopla goes ahead, then the resulting business would dominate the rental sector – knocking Rightmove into second place in terms of agency users.
On the same criterion Rightmove would, however, stay ahead on sales – but only by a whisker.
The claims come from market analyst Doug Shephard, business development director of property search engine Home.
He predicts that a price war would result.
A decision on the merger had been promised by the OFT on March 1, but yesterday afternoon the OFT said there was no update.
But if the merger does proceed, then Shephard says that in terms of portal customers – ie, agents – rather than web traffic, then it would be bigger than Rightmove for lettings.
Shephard said: “Taking a look across sales agencies, we estimate that Rightmove covers 76% of agent offices, FindaProperty 61% and Zoopla 39%.
“FindaProperty and Zoopla combined would cover 71%. However, if we add in the lesser-known Mouseprice (part of the DPG stable), it’s neck and neck with DPG’s overall percentage of sales offices coming out at 75%.
“The booming rental market on the other hand presents a very different story.
“Rightmove covers 68% of letting agent offices, FindaProperty 62% and Zoopla 41%. FindaProperty and Zoopla combined would cover 73%. Add in Mouseprice and the TPPG letting-agent share reaches a Rightmove-busting 78%.
“Our assessment of the likely impact of the proposed merger suggests that Rightmove would be knocked into second place by the superior market presence of TDPG and Zoopla in the rentals sector.”
He went on: “Should the merger go ahead, Rightmove would be expected to fight back by attempting to increase their share of rentals. This potential battle of the giants should lead to price competition, which would help reduce the costs of both selling and letting.”
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