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News Limited supremo Rupert Murdoch has debunked the idea that REA Group is attempting to take commissions agents earn on property transactions.
As reported in his own News presses yesterday, Mr Murdoch reportedly delivered a speech to a private audience in Sydney late last week that reassured agents that leading property site realestate.com.au was not introducing a new market-based pricing model that would mean less revenues for agents.
Part of Mr Murdoch’s speech was quoted in The Australian: “Despite misleading statements from our competitors, I want to reinforce what Peter Tonagh (REA’s interim chief executive) said earlier this month. Real estate agents are critical to the property process and critical to our strategy, and they always have been and always will be.
“That’s why REA only accepts listings from licensed real estate agents, offers agents branding and profiling tools, invests in marketing events and agent education initiatives, and delivers access to a wide world of buyers, including in China,” Mr Murdoch said.
As has been reported extensively by Real Estate Business, there are real concerns that REA is using the huge reach of realestate.com.au to ramp up advertising rates to what many believe are prohibitively expensive levels. “Greed in the purest form”, is how James Tostevin, director at Marshall White, recently described it.
However, REA chairman Hamish McLennan claims its strategy is merely to combat that of its competitor Domain, which is owned by News’ media competitor, Fairfax.
Mr McLennan cites Domain’s potential acquisition of Canberra site Allhomes.com.au, combined with the Fairfax-owned The Canberra Times, would give the group a monopoly in the nation’s capital.
“There’s a lot of misinformation from our competitors around REA, but we are absolutely focused on working with agents,” Mr McLennan was quoted in the News presses yesterday.
“Ironically, they [Fairfax] accept private listings in competition with agents, which is something we don’t do. Our focus is on working with those agents and continuing to invest in better products where we spend $45 million a year,” he said.
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