A City analyst who has until now been very positive about OnTheMarket’s prospects appears to have undergone a change of sentiment.
William Packer insisted to EYE, however, that he has not done an about-turn.
He is one of two City analysts to have upgraded Zoopla ahead of its full year results due on Wednesday morning, both made in the light of Zoopla’s acquisition of uSwitch as well as their views on OTM.
Packer, of Exane BNP Paribas, has moved from an ‘underperform’ rating on Zoopla to a ‘neutral’, while Investec has raised its recommendation from ‘sell’ to ‘hold’.
Both analysts have commented on OnTheMarket, with Packer saying that he expects OTM to be “unsuccessful” in reaching its target of 7,500 agency branches.
However, Packer’s report to investors says that OTM’s current letter of intent recruitment campaign is understood to have launched in March, while his covering letter refers to “seven months”. In fact, OTM’s third letter of intent campaign was not launched until June.
He also talks about OTM reaching “7.5k letters of intent target”. However, OTM has previously said that is the target for total support – ie, both contracted offices and letters of intent.
OTM has also previously said that a tipping point could be reached when it achieves the milestone of 7,500 contracted offices, in terms of the battle with Zoopla for most inventory, if the new members choose Rightmove as their ‘one other portal’ – as almost all existing OTM agents have done.
Packer – whose report does refer to OTM’s successful launch and its subsequent resilience – said that the “threat of another tranche of member losses” to OTM had reduced.
He went on: “Based on conversations with our network of estate agent contacts, and with Agents Mutual at under 1k letters of intent after seven months of recruitment, we remain cautious on its prospects for success and expect the challenger to be unsuccessful in reaching its 7.5k letters of intent target.”
Packer said he expected the portals’ current status quo to hold, with OTM taking a “significant” third place.
However, Packer said he remained “cautious” of Zoopla’s longer-time pricing power, with its inventory still 25% below what it was in November 2014.
Although Packer’s position on OTM sounds like a radical shift in sentiment, he insisted to EYE that nothing had really changed.
However, he said of OTM’s latest update that he found its recruitment figures “underwhelming”.
Steve Liechti of Investec, in his note to investors, said he was still concerned about the widening gap between Zoopla and Rightmove, as well as the “persistent drag” from OnTheMarket.
He said that OTM was weakening Zoopla’s market position against Rightmove, with lower inventory, traffic and questions as to the quality of leads. However, Leichti said he still believed Zoopla offers a return on investment and that its model remains strong.
He said that net churn of agents to OTM stablilised in August and September, and he did not “expect significant further loss with limited OTM traction in terms of membership growth and visitors”.
Liechti said: “Although OTM looks likely to stay, we believe our forecasts already account for this.”
Investec is forecasting Zoopla to reveal £44m in pre-tax profits on a turnover of £107m, increases of 15% and 33% respectively,
Meanwhile, in yesterday’s Sunday Times “Inside the City” column, Danny Forston said: “Zoopla should be almost dead by now, shouldn’t it?
“In January, estate agents fed up with handing over great wads of cash to Zoopla and rival Rightmove branded together to set up a rival listing website: onthemarket.co.
“Don’t worry, I’ve never heard of it either.”
His piece ends saying: “Zoopla isn’t dead. On the contrary.” He advised readers to buy.
The Exane report is here
When the analysts you’ve paid to communicate your propaganda are jumping ship you know it’s over.
Nice idea, poor execution will read OTMs headstone.
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RIP Zoopla….. their digital headstone will read!
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GPL, do you actually read the article before you comment?
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I don’t follow that post. Are you able to explain who is paying who and what propaganda is being communicated?
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It’s funny isn’t it……. less than 1 Year and OnTheMarket.com have extinguished Zoopla’s position as a defined Property Portal….. Zoopla has changed course to try and make itself attractive to investors as its lazy sitting happy at No2/last to Rightmove has been fully exposed by OnTheMarket.
We are only talking about Zoopla because they are sliding away from being a focused property portal.
No mention of Rightmove in any meaningful sense because Zoopla offer nothing in the way of a rival property portal. Sorry Zoopla….. your shortcomings have been monumentally exposed however fair play….. you have recognised/accepted that and turned away to try and find another way to attract investors……Uswitched quite literally!…… all because OnTheMarket actually demonstrated that there is a real alternative in the focused property portal market.
Less than 1 Year! OTM….. less than 1 Year….. lets reconvene on 26 Jan 2017.
Zoopla didn’t find its happy and OnTheMarket.com is warming up nicely…… OTM is dug in, building and looking forward!
As The Proclaimers would no doubt sing!…… Sutherland No More, Zoopla No More!……
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Don’t get the Proclaimers involved! You will have Springett trotting down the corridor this morning singing ‘How do I sign up 500 more!’
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Disillusioned…… I’d rather talk about The Proclaimers than Zoopla…. however it seems the Zoopla Canteen is shut as they’ve Uswitched to PIE instead.
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GPL you are asking to reconvene Jan 2017 just a few weeks ago before the poor figures for OTM came out you were saying give it until Jan 2016!
I think it’s fair to say even if they pull the plug on OTM you will continue to say it’s working.
Are you familiar with King Carnute?
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smile please…..poor figures?!??? …..not from where I’m standing…. I’ll take a strong foundation from OTM 10 months in rather than the crumbling one that supports Zoopla.
Zoopla are changing into something else as they have accepted that their longstanding No2 is nowhere in portal land…… how many years have they been staring up at the @ss of Rightmove?
On OTM…..2016 & 2017….. I’m interested in both!
2016?…… OTM STILL here despite all the cry baby comments from Duopoly Bunnies!….. it’s funny that! ….. like Marmite!….. OTM, love them or loathe them….STILL here.
2017…… another milestone….. probably more important for me than 2016 because 2016, in my view….. we are where I thought we would be…… however 10 months on and OTM has taken 25% away from Zoopla!…… remind me what all these Online Property Listers have done since launching?
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Yes they have a strong foundation but numbers have not grown since launch.
There is an issue with recruitment that is not being addressed. OTM is not growing it is standing still.
It hurt Z when launched but Z have weathered it out. Unless there is a change in recruitment Z are not going to worry. RM have only got stronger in this time.
GPL you must admit this is not great, as passionate as you are, and backing OTM on here and with your wallet do you not want more? As a paying member why not ask for change?
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G.ormless P.asse L.uddite
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HarryN…… you are a fart in a jar!
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A new, humiliating, low, GPL.
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DE….. open your lid and smell the fresh air
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Zoopla offer nothing in the way of a rival property portal.
Other than materially and significantly more traffic, members, leads, consumer tools, brand awareness, innovation and return on investment you mean?
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Yes. But apart from that, what have Zoopla ever done for us??!
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Alex C isn’t the messiah, but Springett’s a very naughty boy.
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DE…… Zoopla are pointless…. I’m sorry to say it, but they are….. they offer the Aldi Portal Alternative….. looks similar….. but tastes awful!
It’s Rightmove and OnTheMarket….. at least there is a clear difference….. however I hope long term OTM becomes THE UK Property Portal….. time will deliver the final result.
Zoopla just exist as an invisible No2….. at least their change of direction signals that they No Longer see themselves as a True Property Portal!…… an honest admission from them and one their shareholders may benefit from.
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If OTM can’t topple an invisible and irrelevant embarrassment as Zoopla, what does that say about it’s own chances? I’ll give you one guess.
I live in the real world, as do the readers here (in the most part) and can see what’s really happening. Which is pretty much business as usual for the 3 good portals (RM, Z & PL) and utter obscurity for the other OTM.
Your posts are suggesting you’re losing the plot and starting to pull little girls pig-tails instead of offering reasoned debate. I’d reassess your approach to these public, and permanent, forums, for you’re embarrassing yourself.
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sticks & stones DE….. try and not throw them in this playground.
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It’s Rightmove and OnTheMarket….. at least there is a clear difference…..
Yes there is a very clear difference, everyone uses Rightmove, hardly anyone uses OnTheMarket
Zoopla just exist as an invisible No2
An invisible portal that has, by a mile, more members and stock than OTM
Zoopla are pointless
That’s just funny given that you are a member of OTM
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Isn’t the main point the consumer? Do they know they need to search in 3 places?
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Farnaz, you are clearly new here.
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Farnaz, welcome to EYE!
This is HarryN, every forum has one
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Good point Farnaz, I don’t think some others on here have ever thought along those lines…
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For a dead business, 40% EBIT sure does compare well with Zoopla’s agent customers.
Can’t all be because Alex doesn’t waste money on pinstripe suits
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Zoopla’s taken a bit of a beating but I would suggest that “What doesn’t kill you makes you stronger”. The have diversified and are reporting MORE profit!
At the same time OTM seem to have given it their very best shot and their opponent is not only still standing but dancing round the ring with a smile on their face.
Unless OTM can do something truly spectacular then I think they will struggle to remain relevant.
BTW – you are welcome to be mean to me (some of the comments on here at getting truly personal, unprofessional and downright disgusting) but what I would like to see if you do care to reply to me are some constructive ideas as to how OTM can sort itself out because that would be helpful. Please also don’t defend the status quo.
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People have offered a ton of suggestions in many many many other threads on what OTM should consider doing.
They will do what they want
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You are right AC but as Gump points out you can try and have these debates but the blind passionate supports will not listen.
It ironic, they need more members, so agents that have not joined up tell them why and what would help but they put their fingers in their and stamp their feet. And guess what membership has not grown since day 1!
You are also right the personal attacks are very childish and again shows a floor in a “Mutual” OTM cannot get members, just imagine if they did everybody will be fighting each other on which direction to go!
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One thing that might be worth posting on here is a friend of mine with 3 branches has signed the new ‘letter of intent’ in his words ‘to stop that b1*ch calling in all the time’ fair to say he has zero intention of joining. (brace myself for comments from the crazy gang)
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Chrispy…….you have a friend??? …..are you looking in the mirror again?!
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Off to list some more houses for sale…… sales beginning to slow although better quality buyers and despite what particularly The Duopoloy say….. they can’t deliver buyers with their 10 Billion Hits per week, month… whatever.
It’s funny….. I have still never seen a portal sell any our properties….. just myself and my staff working hard at that old fashioned thing?…… Estate Agency!
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Good one GPL, classic
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If ever there was a time to offer a reduced initial fee, ‘special introductory offer’ ‘Black Friday’ ‘Cyborg Monday’ ‘BOGOF’ offer it is now. OTM is stalling and in danger of failing all together if the ramblings of the postings of PIE are to be believed.
Yes it will upset the ‘I paid the full whack and life isn’t fair’ brigade – I rant like that every month when I get my Sky bill and thousands of new Sky subscribers get the same package that Sky charge me £70 a month for under £20 !! Don’t even start me on BT – Champions League – you gotta be kidding.
The alternative is that the OTM obituary will read – ‘Had a damn good go but due to apathy died in it’s infancy’
I fear it’s time for IS to bite the weener and get the membership up to the magical figure of 7500 and quick, time is running out.
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GPL, I echo the remarks of DE, I wouldn’t say deluded but you are certainly one of the 5 year members hanging on to any thread of support you can and it shows badly on you the way you are arguing what seems certain to be a lost cause, desperation exudes from every pore of you and as for selling a house I wonder where you find the time after your many childish rants on here today.
We all want what is best for our profession and that means otm,z,pl and rm but otm will only make it to 3rd or 4th place and thats ok as it can still be a useful and worthwhile tool that could be around for years but it must relax its one portal rule
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GPL, you and many other AM supporters stated before OTM launched that buyers would ‘follow the stock’.
Therefore all AM had to do was to recruit, say, 20% of agents and that would guarantee instant volume traffic almost from the start. I remember RealAgent was one of the most prominent supporters of this argument.
And yet … after 9 months OTM’s traffic is 5% at best of Zoopla, who you kid yourself are the ‘invisible No2’.
You, other OTM diehards and indeed AM itself are ignoring one of the most fundamental basics of what makes a successful business … and that is giving customers what THEY want … not what YOU or your business wants.
Buyers and sellers never wanted a third major portal, never expressed a need for it and have no use for it. If anything, as many have pointed out, OTM actually makes it more difficult for buyers to find all of the property that matches their criteria.
OTM was conceived, designed and launched for the sole benefit of estate agents.
And that is why it will fail.
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Has anyone researched just how many property portals are sustainable?
What if there can ever only be just one big site like RM and second/third just don’t rate at all or could there be five, six or even twenty all viable or appealing to smaller vertical markets.
Anyone wanna throw in their threepence on this?
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Tesco, Google, Ebay and others with substantially deep pockets have all looked into it and withdrawn seeing no viable opportunity.
Make your own conclusions.
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DE – correct.
For the simple reason that buyers would prefer to see ALL of the property that matches their criteria in ONE place.
Z has differentiated from RM by offering a valuation tool and also showing most recent listings first + of course spending millions in advertising during the period when portal use was still maturing.
OTM have nothing to differentiate and have come far too late to the party.
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If there were portals that had different USP’s then there could possibly be loads.
If you take the detergent companies (there are only 2 major ones in UK) they have created the illusion of a market buy bringing out different brands to reduce their competitors market share. Surf, Bold, Persil, Daz are all made by 1 of 2 companies.
It may just be this hard for others to enter the property portals game as RM/Z/OTM these have such a commanding share of the market.
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If RM & Z had 0 properties listed with them would the general public stop buying houses?
Of course they wouldn’t. They would just find a different route to the ‘house of their dreams’.
To succeed fully OTM needs to the support of the majority of Estate Agents in the country.
It also needs to have the majority of stock. Estate Agents have it within their own control to ensure that OTM has the majority, and sole source, of stock.
Putting aside the one other portal rule, Ian Springett’s salary, their London offices and the Country Life deal why would that ‘goal’ be a problem to any Estate Agent?
Remember, if RM & Z had 0 properties listed with them would the general public stop buying houses?
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The biggest issue is that OTM are looking at charging an established portal rate when it is a start up.
Also even if OTM gets say 15,000 agents there is no assurance they will then walk away from RM.
Z had circa 15,000 / 20,000 agents but did not stop other agents advertising on two portals.
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Fair point about the rate SP. However, why would Agents want to pay for 3 portals though when they can create their own market leader?
If OTM was the place that had the majority of stock it would very quickly become the market leader.
Although they are big brands, the achilles heel that RM & Z have is that they are only as good as the stock that Agents choose to place on them. If they don’t have the stock their audience will become disaffected.
Less stock = lower traffic = less influence.
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I agree in principal.
But again look at it that Z was 1/3 of RM portal fees i would guess 80% of agent in England this time last year were on Z & RM.
Do you really think agents are going to leave RM? Even the agents that have joined OTM have not left RM.
The only way i can see OTM working is either
1. Pretty much give it away, hope to acheive enough numbers and then enough are brave enough to walk away from RM
2. Have a date in mind to walk away from RM and and get binding letters of intent and keep members updated.
Otherwise i really cannot see how its going to work
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“Have a date in mind to walk away from RM and and get binding letters of intent and keep members updated.”…I suspect that this will be a breach of competition laws.
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Only thing i can see actually working.
Without any clear defined aim it just flounders.
The more i think, see, hear about OTM the more i think its a dream not a reality.
And looking at the numbers many feel the same.
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I believe the aim is to get to 7500 branches and number 2 portal based on listings, I suspect that should this happen then many other agents may decide to move their marketing spend to OTM.
You say many feel the same Smile Please but the truth is that all of us, you, me, William Packer etc have no idea whatsoever the amount of branches that have signed these letters nor in fact the general feeling amongst agents, we are all speculating based on our own thoughts, opinions and agendas. Not even the OTM reps know the full picture in fact probably only a handful of people at OTM have this information to hand.
In all fairness this report today is not worth the paper it’s written on. It’s a report based on having no information.
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And there lies the problem nobody knows the exact figure.
The figure that came out the other week basically said 5400 firm members with XYZ letters of intent (sorry forget the figure).
So OTM has managed to keep the numbers it started with which is great news but failed to add any.
Lets say they do get 7500 in the next year, what then? Is that going to change anything?
Is that going to get agent away from RM – is an extra 2000 members really going to stop buyers and sellers looking at Z when they are so far ahead in website hits?
And thats the issue OTM now face, okay its a good third choice portal. it does not have a back office system, it is not market leader, still does not take traffic away from RM so what does it do? Replace Z?
We can go round in circles forever, the way it stands OTM is not attracting enough members, the members it is attracting have not left RM. Something needs to change a non-binding letter of intent is not what is needed.
And people like GPL just mock others when in fact he should be looking to embrace them and listen to why the majority of agents have not signed up is a big issue.
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really…….Zzzzzzzzzz
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You can’t blame William Packer of BNP Paribas for his analysis, baring in mind he has no idea as to how many branches have actually signed letters of intent.
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Gosh….. you Zoopla guys still stumbling about here talking about how good it is being the Invisible No 2? ……in the interim I’ve been busy taking on properties for sale! Clearly being No 2 means you fellas have loads of spare time….. going on about OnTheMarket.com?….. odd?!…. why bother?….. no point!….. you’re focused on Rightmove??!….. No!!….. never have been! …..and so when I dumped Zoopla it made Zero difference to my business!…. other than save me money!
I didn’t dump Rightmove because, at present they are clearly the No 1 Portal, Zoopka, sorry Zoopla are really pointless…. although I seem to remember their brand on the side of London Buses….. proving of course that the stone age of marketing still has a place.
I’m sure Zoopla has a market somewhere….. I personally though have no idea where, probably London?
Let’s agree to disagree….. OnTheMarket.com …..supported by Estate Agents who are interested in the future of our industry…. in terms of Portal Advertising…. after all, that’s all it is…..Digital Monkees with Digital Advertising Sandwich Boards…… monstrously overated in the sense that it is a Business built on Number of Hits…. 10 Million, 10 Billion, 10 Trillion?!….. who cares when it is a business that fails on almost every level to define a quality homebuyer…… it’s the biggest advertising scam of all time!…… monthly fees and add-ons for Millions, Billions, Trillions?….. of ?! oh yes…… Hits!
Certainly Rightmove should be congratulated for keeping the charade going and selling the concept to investors……. and creating the virtual advertising market.
Zoopla….. stick with reinventing yourself and lose your diehards that are clinging on for 2nd/last!….. they have nothing to contribute other than protecting their jobs it seems, from the many frequenting here.
In this playground it seems that estate agents are few & far between, however, like me they are hopefully out there getting on with the business of Real Estate Agency!
Zoopla?….. The Bucks Fizz of The Portal World!….. just without the fizz, and 20 Years too late! …. apart from Alex & Co quaffing at the share font! loverly jubberly!!!
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GPL,
You’ve been busy taking on properties for sale!
WOW … we ARE impressed.
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Well done GPL shout everybody down.
What does that do?
Simple fact is OTM has not grown active members since the initial launch (some are now advertising that did not at start as contract had to be honored with z).
Agent on here are saying why they have not signed up and you are just trying to shout them down.
If you really want OTM to work, listen to concerns and look to influence OTM in recruitment.
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Here’s The Summary……
If OnTheMarket.com were on a non-contender…… why on earth are you on here twittering away?
The fence-sitters, non-believers and duopoly employees etc have simply supported the Duopoly Status Quo….. and delivered nothing of substance to the future of our industry.
I’ll leave you to engage in your duopoly divide & conquer approach…..
Rightmove are currently the No 1 Property Marketing Portal
Zoopla are wasting their time shadowing Rightmove, hence their change of direction
OnTheMarket.com arrived, dug-in and continue to build….. whatever happens it is the future that will decide….. those of us on here and elsewhere that committed and intend committing to OTM have demonstrated their drive/commitment to the future of our industry.
The sting in the tail?……. OnTheMarket.com isn’t going away and any real estate agents on here (not the duopoly employees, timewasters, kid-on fence sitters etc) that choose NOT to support their industry by engaging/supporting OTM are demonstrating that they are sadly only interested in their own square footage of business…… in which case, 5500, 6500, 7500, 10000 OTM Members can take immense pride from the fact that they are indeed R E A L Estate Agents with a R E A L commitment to the future of our industry! ……however the cards fall in the future they were NOT the gawping bystanders that we see so often twittering away about what they would do or how they would change things or why something is wrong….. however they have no guts/commitment to take the step…… by those actions they are both weak and selfish as they care only for themselves…… thankfully I have zero interest in being in that group of people.
Keep sucking it up Duopoly Lovers…… it’s so much easier to be led than lead.
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