Name: Michael White
Company: Email Mortgages
I see the entry of Oxfam as a positive move for the market, and even more so the possibility of Tesco and Google providing flat-fee online house selling listings.
I suspect that Oxfam will pursue a white-label strategy, which enables a successful brand to offer a service without having to invest in creating the technology and infrastructure itself.
This would certainly not be an issue of acting outside of any core competency and would bring some useful revenue to the good causes supported by Oxfam. The same point on core competency applies to Tesco and Google entering the estate agency market.
The report from the Office of Fair Trading found the housing market remains dominated by traditional estate agents with weak competition between them on price, and I agree with it that innovation in online services would change this.
In addition to the vast brand awareness of Tesco and Google, both have massive potential client leverage, due to huge databases. Both have also been involved in developments in the housing market before.
Users of Google have had the ability to search for real estate listings in the United States and Australia for some time.
Tesco first announced that it was planning to move into the house selling market back in 2005, so it will have gained much research and expertise. Now it may once again be in talks with estate agents to set up an online venture, which would allow home owners to list their properties for a flat fee.
Name: Simon Checkley
Company: Private Finance
With Oxfam competing against Moneysupermarket and Google and Tesco looking to make inroads into the market share of the likes of Rightmove and financial product provision, the high transactional, low-margin part of the housing market will certainly be affected.
However, the upper end of the market, where comparison sites cannot cater for the complex financial affairs of high earners and where property agents use their local experience to match buyers and sellers of unique properties, should be less affected.
The real shame is the apparent lack of an advice component in each new entrant’s proposition. The average borrower needs low-cost advice. There is a danger that they could buy directly online or could select the wrong product as they may be led only by what a salesperson or a call centre has told them.
These new entrants need distribution and yet there is a well-established community of independent mortgage advisers. Why does it not make sense to exploit this resource alongside an efficient technology driven process? Is it training, current and future regulation or pricing?
It would be very good if we were to see a commitment from existing players as well as new entrants to address the need for access to independent advice.
Perhaps networks, on behalf of their members, should lead the way with existing and new entrants, with a view to delivering a differentiated product and service proposition in time for recovery in the general mortgage and property market?
Name: David Hollingworth
Company: London & Country
Any talk of new entrants in any area of the current market will always arouse interest. That is true whether talking about new banking propositions or distribution channels, especially in today’s constrained market.
Of course, comparison websites have long become part of the furniture, and indeed have pretty much become an entire industry, with big-names fighting it out for a share of the market.
The move by Oxfam to launch a comparison site that contributes to the charity’s fundraising sounds like a new twist, although anything more than a cursory glance reveals that the site will be simply another white-labelled version of an existing resource.
Perhaps more revolutionary is the proposed move by Tesco and Google into the realms of estate agency. Many have tried to upset the status quo of the traditional estate agency model, but none have managed to make an impact so far. That could well change with the weight of these players.
Both are well known for innovation; they are leaders in their sectors and mean business. Tesco knows how to distribute products efficiently and effectively, whilst Google is peerless when it comes to the web.
I would expect that it will be precisely these skills that they will bring to bear and I think there is nothing better than a new approach to invigorate a market. It will ultimately be the consumer that decides whether a new proposition offers an improvement and estate agents will be out to prove their worth is greater.
