Murdoch’s News Corp has moved into the mortgage business. Where are the regulators?

If you want to advertise a house online in Australia, you don’t have many options. Just two companies dominate the market.

Australia’s largest property listings platform, realestate.com.au, belongs to digital media company REA Group, which is majority-owned by Rupert Murdoch’s US-based media conglomerate News Corporation (News Corp).

REA claims average traffic of 11.9 million viewers per month, substantially more than that of its nearest rival, Domain.

That’s led to widespread concern about REA’s dominant market power and the potential for price-gouging, which are currently subject to an ongoing probe by the Australian Competition and Consumer Commission (ACCC).

Meanwhile, my research has revealed that REA has expanded into mortgage lending, an important new direction which, until now, has escaped attention.

The implications here are worth considering. News Corp, a foreign-owned media company, now has a direct stake in framing the Australian housing narrative and influencing policy, while profiting through its property platform from listings, data, and its own mortgages.

It’s a shrewd business strategy. But Australia currently doesn’t have a regulator fit for overseeing such a hybrid entity, raising serious questions about who is keeping watch.

‘Good debt’

Australian households have long accepted the prevailing narrative, promoted by the media, that housing investment is their “path to wealth”. Mortgages are endorsed as the way to manage the growing gap between flatlined wages and rising house prices.

Primed for finance in this way, many households have come to embrace mortgages as an aspirational form of “good debt”, the mark of a savvy player rather than a long-term financial burden.

This has helped fuel what could be described as a housing “frenzy”, a volatile situation in which escalating housing prices and indebtedness undermine household wellbeing. Younger generations and the disadvantaged, among others, are left out in the cold.

From newspapers to platforms to finance

As digitisation has forced legacy media players such as News Corp to seek new strategies to stay viable, so too has it disrupted the finance industry by opening it up to non-bank players.

Taking advantage of this opportunity, REA Group entered the mortgage market in 2016, starting with a partnership with National Australia Bank. It purchased mortgage brokerages the following year.

The realestate.com.au platform was then redesigned to include a mortgage portal to direct millions of Australian homeseekers to lending through those channels. This provides REA with revenue from platform leads to the bank, as well as up-front and trailing mortgage commissions from their brokers.

REA also harvests the extensive financial data supplied by millions of users via their financial profiles and the calculator tools embedded in the website.

That data, an increasingly valuable asset, can be monetised through the platform’s advertiser and homebuyer markets, and News Corp’s extensive partnerships with data broker and analytics companies.

Selling mortgages

Most recently, REA Group has taken its finance strategy one step further. In October 2024, it purchased a 19.9% stake in digital non-bank lender Athena Home Loans.

This allows REA to profit directly from its own mortgages offered to platform users through its current brokerage, Mortgage Choice.

For REA Group (and its owner, News Corp), this move is both logical and strategically compelling in a challenging media environment. As well as influencing policy, REA Group and News Corp are proficient in crafting and cross-promoting a powerful message about housing and debt to the public.

With their profit now even more directly tied to the housing mortgage market – and thereby customers’ debt – the Athena acquisition can only strengthen REA’s vested interest in the continued rise in house prices and household indebtedness. This has the potential to undermine policies to improve housing affordability.

The law can’t keep up

The power imbalance against consumers is stark. So which regulator is keeping an eye on it?

Such an initiative combining housing, finance and media can slip through the cracks in Australia’s fragmented regulatory system with its narrowly-focused legislation.

The legislation lags behind the technology as well. A platform’s persuasive design, with its algorithmic tools, predetermined paths and data harvesting, obscures its prioritisation of commercial interests over that of consumers.

Players from different industries interacting through the “black box” of a platform appear to come under looser regulatory oversight than those from a single industry or operating outside a platform.

As an ACCC representative admitted:

the legislation isn’t updated in the way that […] keeps pace with the evolving technology, trends and emerging markets.

In a landscape where such complex digital initiatives are becoming the norm, regulators urgently need to update their understanding and broaden their jurisdiction to include them.

And not just in Australia. REA has confirmed that a successful trial of its initiative here will lead to its rollout across its broad global property platform network.

Nor just REA. Other companies are eyeing this space. REA’s closest competitor, Domain, is currently under acquisition by CoStar, a major digital real estate player in the United States, with the aim to challenge REA.

The rapid and major disruptions caused by such initiatives, such as Airbnb’s negative impact on housing affordability globally, can be difficult to redress retrospectively.

Somebody needs to keep watch.

REA Group declined to comment on this article.