LONDON (Reuters) - The owner of Britain’s Zoopla and Prime Location property websites said it had been deserted by thousands of estate agents since the launch of rival portal OnTheMarket, but insisted the new company would struggle to win over home buyers and sellers.
Zoopla Property Group and market leader Rightmove have dominated the British online property search market for years but are now facing a major challenge from OnTheMarket, which launched last month.
The new website is owned by Agents’ Mutual, a company launched and backed by estate agents. It is shaking up the sector as its rules require estate agents to restrict listings to OnTheMarket and only one of its two big rivals.
Zoopla said it currently counted 13,402 British estate agency branches as members, down from 16,373 in September, and that 500 branches had given notice but were still paying fees. Analysts said this suggested it had lost 3,471 members in total since the launch of OnTheMarket.
Shares in Zoopla were down 3.2 percent at 180 pence at 1024 GMT.
But Zoopla boss Alex Chesterman said he believed the new website would struggle to gain traction with consumers. He said data from web analytics firm Hitwise indicated OnTheMarket had attracted an average of 14,000 visits per day in its first two weeks, versus almost 1.4 million per day for Zoopla.
Zoopla had a company record 50.5 million visits in January, Chesterman said, and some agents were already beginning to return to the platform.
OnTheMarket said that Zoopla was “out of touch”, claiming that its member agents were committed to the property portal.
“We are confident in becoming the number two portal within a year to replace Zoopla,” OnTheMarket Chief Executive Ian Springett said in an emailed statement.
Analysts at Jefferies said OnTheMarket’s rule restricting agents to using just one of its rivals had taken its toll on Zoopla’s membership numbers, with the majority of agents sticking with Rightmove in preference to Zoopla.
It now expects Zoopla’s agent numbers to fall by more than 18 percent this financial year to around 13,400, against its previous estimate of about a 10 percent fall, and it downgraded its core earnings forecast by 17 percent to 36.6 million pounds.
But it also questioned whether OnTheMarket had stamina.
“Zoopla has more hits per day than there were housing transactions in 2014; whilst a number of agents may have left Zoopla, for now, it appears that the home-buying public remain convinced of Zoopla’s attractions,” Jefferies said.
Editing by Pravin Char and Susan Thomas