Agents trying to reclaim domains are deterred by rising prices — Interview

Written by Stuart Condie

SYDNEY–Domain Holdings Australia CEO Jason Pellegrino said Domain Holdings Australia has won back a significant portion of agents that had previously been turned away by rising prices for real estate advertisers. He said that it is growing.

The ASX-listed company’s 2% year-on-year drop in home sales in the six months to December is a sign that it continues to lose market share to larger rival REA Group, which posted a 4% share last week. analysts pointed out. Increase in number of listings during the same period.
Pellegrino said Wednesday that Domain pushed up prices by an average of about 12% to prioritize yield over volume, knowing that some agents would remove listings from the platform.  Many people have returned since early January, he told The Wall Street Journal.
“We were actually able to encourage a significant portion of them, more than half, to come back to the platform without actually sacrificing yield,” he said.
“We made a bet that we were going to reset a product that we had been a little hesitant to take credit for in previous cycles and actually get value from.”
Pellegrino said Domain’s first-half net profit increase of 73% and 49% increase on an underlying basis suggested the strategy was correct.
Mr Pellegrino said average revenue per property in Western Australia had increased by 40 per cent year-on-year, citing Domain’s increased focus on regions outside of traditional property hotspots such as Sydney and Melbourne. . This compares to a 20% increase nationally.
Mr. Pellegrino said it was unlikely that Domain would continue to raise prices this much. He said he remains confident that yields will increase through higher levels of product uptake.
REA is 61% owned by News Corp., owner of the newswire and Dow Jones & Co., publisher of the Wall Street Journal.
Email Stuart Condie at [email protected].