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Online auction site Trade Me, which also advertises real estate, is seeking to buy property data service, homes.co.nz.
Trade Me’s application to buy another property website, homes.co.nz, has hit a snag.
The Commerce Commission has warned it has some concerns about Trade Me’s application for clearance to acquire PropertyNZ Ltd, which owns and runs homes.co.nz.
The commission has authority over major acquisitions which might leave consumers worse off, and said it was not yet satisfied that the deal would not substantially lessen competition in the property classifieds and data market.
In a statement of unresolved issues, the commission said Homes.co.nz had enjoyed substantial growth in the property listings market, and in the property data (audience) market, which Trade Me also competed in.
“The proposed acquisition would eliminate that potential competition and raise barriers to entry, and this will have a flow-on effect of reducing competition in the audience market as a result of network effects,” the commission said.
Homes.co.nz’s services include a solar estimate function which shows where solar panels would be best placed on a house.
“There is a real chance that the remaining actual and potential competition in the markets in question would not be sufficient to replace the constraint lost with the proposed acquisition.”
However, the commission stressed its concerns were not a final decision and did not mean it would decline or clear the acquisition.
“We are still considering whether the flow-on effects on competition in the audience market would be substantial,” it said.
It was less concerned about homes.co.nz’s rental listings service which was comparably small.
Submissions are due July 14 and the commission said it may push out its original decision deadline of August 6.
Formed in 2016, Homes.co.nz’s services include sales histories and current value estimates for prospective buyers or vendors, and it has increasingly been promoting itself as a vehicle for listings of properties for sale.
Trade Me Property and Realestate.co.nz have traditionally dominated the listings market.
Continue reading this article at the original source from Stuff.co.nz
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