A great interview by PS Investor Services.
Now a household name, the Rightmove property portal has now become the first point of call for the large majority of the nation’s house buyers and sellers. Launched in 2000, the company is now listed on the London Stock Exchange and recently attracted attention as being one of the only sites on the planet that Google pulled out of competing with due to its well established presence.
We were therefore very grateful to be able to ask some questions to Miles Shipside – the company’s commercial director – who has had an integral role in bringing the company to where it is today. We focus on how the company has grown over the last 10 years; maintaining its strong position; 2011 plans; searching for investment property; quality control; what makes a successful property advertisement; the overseas property market; the Rightmove property index; the role of the web in the future of buying / selling property and estate agency fees.
1) As the most popular property search portal in the UK, why do you think that Rightmove has got this position? The old process of visiting agents or relying on their mailing lists or newspaper adverts was inefficient, costly and frustrating and with the growing advancements in internet Rightmove was able to produce a new model for property searching. Our website has always been driven by ease-of-use, up-to-date data and more properties than anyone else. From the beginning we worked harder and were more focused than other websites on getting these things right. As the site grew and these things became important to people searching for property we began to stand out and were the site that agents and home-hunters wanted to turn to first. Today we continue to grow with over 800m pages served in January this year (a record for us) and an 82% market share among the top 4 property websites.
2) How are you ensuring that this is maintained? We invested strongly in advertising, particularly in television – which remains very important to us. We also invest heavily in adding new features to the site to keep making the home-search process as easy and manageable as possible. As part of this we resist having any external advertising and annoying pop ups in spite of being offered lots of money, ensuring the user experience stays good. Another key part of our success is making sure we employ bright and passionate people.
3) What are the plans for 2011 that property investors can look forward to? That would give our competitors advance warning, but we keep striving to improve. Draw-a-search was a great example from 2010, enabling users to sketch out their own search area on a map rather than just rely on postcode districts. The comparable information is a big winner with investors, helping decide what’s a good buy and what returns are feasible and we are improving all the time in the sales data and market reports we provide. Mobile and social media are also two areas which we consider key to our growth. In the social media space we are developing a site called Rightmove Placeswhich is a social community website that will enable anyone to share views on their local areas or topics of interest. This should give investors a forum to raise topics as well as check out other people’s comments on what an area is like. We are also looking to improve out suite of mobile products including changes to our iPhone app which have has been a big hit with people who need to stay in touch with the property market and check out new areas on the move.
4) For those who perhaps need a bit of a refresher or have not used the site before for such purposes, how can Rightmove be used to effectively search an investment property? There are three options under the ‘House Prices’ area of the site which serve as a great tool for property investors: (i) Find Sold Prices which uses Land Registry data to provide analysis of what homes have sold for in the areas you are interested in; (ii) Price Comparison Report which factors in currently listed properties and sold prices to give you a picture of what a property may be worth; (iii) Market Trends allows you to map out price performance over time in your chosen area. As well as these feature Rightmove is unparalleled as a search tool in the current property market, both in terms of number of properties listed (on average we listed around 90% of homes currently for sale) and searching options meaning you can filter by things like auction properties and various house types.
5) What kinds of controls are put in place to ensure that properties advertised are genuine ones? Where relevant, advertisers have to comply with the Property Descriptions Act, Estate Agents Act, Ombudsmans Schemes and other criteria about accuracy specified in our terms and conditions. There are a few rogues in every walk of life but we hope the fact that all advertisers warrant to us that they will comply with these elements of consumer legislation that are under the jurisdiction of local Trading Standards gives a high degree of accuracy and compliance.
6) What would be your tips for successful property sales advertisement that will attract viewers? Great quality of photos, and several of them, whether the property is large or small. The photos and the words used in an advert must help the target audience seeing it think they would consider living there. It must stir the emotions as well as present the facts. We also provide a range of website products which can help boost performance, for example Premium Listing properties receive 34% more views and 21% more enquiries than standard listings. These products can be arranged via an estate agent advertising that property.
7) And the same would go for a property to rent? Yes… tenants are not buying the place so the inside quality of finish is more important than an outside shot that lacks a wow factor or is the same as all the others in the area. However, tenants are staying longer as they cannot get mortgages so easily, so again they need to feel like the place they rent is a home too.
8) Can you talk a bit about your overseas section – its history and plans for the future? Rightmove’s Overseas division first began advertising overseas property in 2004. Since then we’ve grown to average over 1.4 million searches a month for property by Brits looking to fulfil their dreams of a property abroad making us one of the biggest overseas portals. The credit crunch impacted the entire industry hugely in 2008/2009 with entire segments of buyers disappearing almost overnight. Casual investors looking for quick returns combined with easy availability of money were never a recipe for long term success. It’s easy to forget that throughout the bubble years, there was always a core of lifestyle buyers looking for long term property to enjoy. That core is a lot more visible now that the short term investors have deserted the market. For 2011 we think the market won’t grow massively in terms of transactions, but the transactions times and buying timescales will slowly begin to fall again as people become more comfortable and economic conditions settle down. We expect to generate a lot more sales for those advertisers prepared to invest in developing good relationships with buyers in 2011.
9) In terms of the index you provide, you state asking price averages (not sold values) – do you think that this is a particularly accurate way to measure trends, particularly in the current market place? Time has proven that new sellers asking prices are early indicators of where sold prices are heading. The sold indices price movements actually track ours, but a few months later. However, all are useful as long as you understand the different timeframes they operate in and their sample size is big enough. We measure 90% of the market, which means we have a far more significant sample size than mortgage lenders for example who are basing their stats on the number of mortgage-purchased properties they have received.
10) What would be your advice for people researching local house price patterns at the moment? Set up an alert on Rightmove to see what’s new coming on and then see what is selling quickly and what hangs around or gets reduced. Do the same on for sale boards you pass regularly, and pop into agents and talk to them.
11) What are your thoughts on the debate of web property portals overtaking estate agencies in terms of how people will buy and sell houses in the future? Are the high street estate / lettings agency going to be a thing of the past as we move further into the digital age? Personal service and local knowledge from local agents combined with the ease and power of the web. The two used well by local agents seems to help them deliver a good service that helps them get the best of both worlds and attract more customers. Conversely, agents that do not perform well in both will be under pressure. A flash High Street branch is a good advertising hoarding, but it is important it can be seen by lots of motorists and passersby. If not, a more secondary location saves money that can be invested in service and technology to win business that way.
12) The main off-putting factor we see as property investors when selling, are the fees that agencies charge – when comparing them to advertising your house on the net, the costs are significantly lower. Would the agencies have to drop their fees in order to be able to compete? Compared to much of Europe and the USA agency fees are low. However, service has to be good otherwise sellers will resent paying anything. It is the largest transaction of many people’s lives, so 1% to 2% of the transaction is worth it if the agent advises you on presentation and makeover, presents a property fantastically, promotes it in all the right places, and negotiates the best price achieved available in the marketplace at the time.
Source: Thanks to http://www.psinvestors.co.uk/blog for providing this great interview.