REA Group Under Investigation from ACCC Over Market Power and Pricing

REA Group is under formal investigation by the Australian Competition and Consumer Commission (ACCC) over allegations of market power abuse and excessive pricing related to its subscription offerings and property listings.

In a filing to the Australian Securities Exchange, the operator of Realestate.com.au confirmed receipt of a compulsory s155 notice from the ACCC, stating:

REA is cooperating fully with the ACCC and is unable to comment further for confidentiality reasons.

The ACCC has been meeting with real estate agents as part of a broader probe into whether REA has used its position as Australia's leading property portal to push listing and subscription prices beyond fair market levels. The investigation focuses on structural concerns in a vendor-paid marketing environment, where agents say costs have soared beyond affordability for sellers and agents alike.

Listing fees on Realestate.com.au vary based on location and property value. Agents claim prices have risen more than 5,000% over 15 years, with some premium listings in Sydney reportedly exceeding A$4,000 (USD 2,600). Criticism has come from both industry participants and elected officials, with pricing on essential digital services increasingly seen as a policy issue.

Federal MP Sophie Scamps said:

"There are already too many barriers to people selling and downsizing their homes, so it’s disturbing to hear Australians are, yet again, apparently paying inflated prices to have their house listed on real estate marketing platforms.

"The ACCC needs to investigate the prices being charged for using such an essential service."

REA defended its pricing strategy, saying:

REA is committed to providing choice, value and flexibility to its customers and consumers, and remains focussed on delivering products and services that improve the property experience of buyers, sellers and renters.

The value that REA provides is underpinned by the 12.3 million people who visited RealEstate.com.au each month on average in the March quarter, with 6.4 million exclusively using RealEstate.com.au.

bRight Agent, Australia’s leading real estate agent comparison service, has published a press release in defence of the probe, and shared figures suggesting that the cost of listing a home for sale has increased by fifty times in the past 16 years:

...listing a home on REA’s realestate.com.au can now cost as much as $5000, depending on the suburb. That’s a nearly 50x increase from the $75 cost back in 2009.

Aaron Scott, Co-Founder at bRight Agent, said:

"It’s about time someone stood up to REA for the interests of consumers. For far too long, they’ve been allowed to charge obscenely excessive listing fees with no room for negotiation. Agents are squeezed, and ultimately its the sellers who end up footing the bill. It’s an absolute farce.

"What’s the justification for a $5000 listing fee? There isn’t one. This is digital real estate robbery. A monopoly like this makes it nearly impossible for new players to compete or for fair pricing to exist. Sellers aren’t paying for value—they’re paying because there’s no alternative.

"REA is not just gouging homeowners and agents—it’s strangling innovation."

With CoStar Group poised to acquire REA's rival portal Domain, CoStar boss Andy Florance is on the record saying he is ready to escalate product and pricing competition.

He said:

"REA Group’s market dominance is not incentivised to innovate and improve their product. Both [REA and Domain] pale in comparison to the product we built with Homes.com. We will bring what we built in Homes.com to Australia and the United Kingdom to win over consumers."

The ACCC has not set a public timeline for concluding its investigation.

REA Group recorded revenues of A$374 million, up 12% year-on-year, with Australia contributing revenues of A$340M in its recent Q3 results.

Free cash flow was A$132 million. CEO Robert Thomson has gone on the record saying that the Group "has the advantage" when CoStar's Domain acquisition goes through.