The Covid-19 crisis has brought with it a withdrawal of ads from agencies and real estate, main source of income of these portals. The Encinar company arrives with Apax in the starting position

Foto: Photo: E. Villarino.
Photo: E. Villarino.
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The crisis of Covid-19 has put in check one of the most successful business models in recent times: the websites of advertisements for the sale and rental of homes. These companies, whose maximum exponent in Spain is Idealista, followed by other competitors like Fotocasa and, They base the bulk of their income on the service they offer to real estate agents and agencies by advertising them on their ‘sites.’ and, also, being able to do it in the most visible positions.

However, he braking operations which has brought with it the declaration of the state of alarm and the forecasts of a drop in GDP and the unemployment rate for 2020 (-8% and 20%, respectively, according to the IMF) these advertisers have fled. These are increasingly choosing to advertise only through their websites or on a single portal, when until now it was common for them to appear in various.


A situation that, also, in the specific case of Idealista, comes at a critical time for the company, since for months its main shareholder, Apax Partners, is analyzing the sale of the 80% of the company, job where you are being advised by Bank of America y Morgan Stanley, as published in this media last February.

With an income close to 90 millions, Apax plans go through to achieve a Rating, at least, 800 millions, figure that would allow you to quintuple your investment, but that now faces the challenge of an unexpected and sharp drop in revenue from the coronavirus and, what is more dangerous, the threat that it might come to question the business model, since the entire real estate sector is immersed in an aggressive commitment to technology, artificial intelligence and Big Data that constantly lights new companies.

Fernando and Jesús Encinar. (Mounting: Carmen Castellón)
Fernando and Jesús Encinar. (Mounting: Carmen Castellón)

As a sample of the challenge Idealist faces, the button Casafari, ‘startup’ which has developed a platform that collects all the ads on the market, both portals and agencies, and that have been screened and followed for five years. During the alarm state month, in Madrid, this tool has identified 87.018 total ads. Of these, 920 they have raised price, 4.087 they have lowered it, 24.132 they're new, 99 have been reserved, 59 sold and 57.721 appear as unavailable.

"This does not mean that they have been withdrawn from sale, but the agencies are removing their ads from these portals and leaving them only on their own websites or on a single portal, therefore they appear as not available in others ”, Explain Sergio Obregón, head of Casafari in Spain.


“You have to differentiate between removal of ads and removal of real estate. There are houses that carry several agencies, and if any of them withdraws their ads, does not mean that these houses disappear from the database, because they continue, but announced by other professionals. With the Covid, there have been clients who have temporarily withdrawn their portfolio and their ads are not visible”, recognize from a large portal, who asks to safeguard anonymity.

The impact that the virus may have on the Ideal Idealist model’ It will be a function of both the extent of the economic crisis and the limitation of movements, in other aspects. However, in the specific case of the company founded by Jesus Encinar, in his favor he plays being the leader and having already overcome two crises in the past: the ‘dotcom’ early century, that broke out in its beginnings, and the financial-real estate agency of a decade ago.

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