Agents stay loyal to Rightmove but it suffers revenue...

Almost all estate agents are still saying Yes to Rightmove, according to figures produced by the portal this morning.

Membership numbers for agency branches and new home developments combined are down only 3.3 per cent since the start of the year to 19,158 (from a December 31 total of 19,809).

Broken down that shows a 3.5 per cent decline in agency branches together with a 2.1 per cent fall in new homes developments.

The portal says branch based agents, rather than ones operating in the field, remain particularly resilient with a decline of only 300 since the start of the year - that’s just two per cent.

Today’s statement shows the likely reason almost all agents have stayed loyal despite widespread industry criticism of the portal’s high fees - the public still see Rightmove as the ‘go to’ online destination for property.

The statement today says: “Rightmove’s position as the place home hunters turn to first remains strong with market share of time on site at 88 per cent. Rightmove is the only place to find virtually the whole of the property market in one place with over 940,000 UK residential properties advertised. The listings lead over any other UK website has widened to over 50 per cent.”

And it adds: “Continued traffic growth with visits up five per cent year on year helped by a stronger than expected increase since the reopening of the property market in England in May with time on site and visits in June up over 50 per cent year on year. Time on site averaging 1.1 billion minutes per month over the period (2019: 1.1 billion).”

However, the agency did see a spectacular dive in both revenue and profits for the first half of 2020 as the pandemic and its policy of reducing fees hit the bottom line - Rightmove gave a 75 per cent discount to customers following a rebellion over its original offer of a deferred payment period.

Revenue for the six month period was down 34 per cent on the same time in 2019, to £94.8m. Operating profit was down 43 per cent to £61.7m.

Average Revenue Per Advertiser - the key metric for property portals - fell from £1,077 at the end of last year to just £712 in H1 2020.

This morning’s statement from Rightmove includes this from chief executive Peter Brooks-Johnson: “In recent months Covid-19 has disrupted the lives of everyone across the UK. Our customers have shown incredible resilience and ingenuity to continue to trade through this exceptional period. I am grateful for both their continued support and also their proactive engagement to ensure that home hunters have been well informed and protected.

"I’m also immensely proud of the Rightmove team for the unerring dedication which has seen Rightmove operate seamlessly throughout this challenging period and offer unprecedented support to the industry through discounts and accelerated innovation.

“Following the reopening of the housing market on May 13 housing market activity is at record levels, with evidence of new home hunters coming into the market with changing needs as they reassess their priorities and further incentivised by the temporary stamp duty holiday.

“Rightmove has extended its lead as the place home hunters turn to first for their move. It’s quite incredible that 65 of our record days have been since 13 May. I’m pleased that our customers are choosing to invest in our digital solutions to take advantage of this record demand.

“Despite the current strong market we’re mindful that potential economic challenges and further Covid restrictions in the second half of the year make it hard to predict how sustained the increase in activity will be.

“Rightmove’s purpose is to make home moving easier in the UK and the restrictions placed on our daily lives because of Covid have shown the value of the innovations we are delivering to better enable this.”

He continues: “With the reopening of the property market, we had returned all employees from furlough by the end of July 31. ‘Doing the right thing’ is central to the Rightmove culture and as the immediate uncertainty of the crisis passes and given our resilience in the year to date we intend to repay the grant from the Coronavirus Job Retention Scheme and we will not be taking the furlough bonus in January next year.

“We believe that repaying the CJRS grant of £0.7m supports both our brand and our responsibilities to the wider community.”

Matthew Fine
07 August 2020 10:27 AM

Whilst I love positivity you need to remove your rose tinted glasses and come down a bit from that ivory tower. This is all going to get rather messy and whilst it has the feeling of 1989 it is economically totally different. The market is already flattening out in central london and it won't take long for that wave to move out!

Algarve Investor
07 August 2020 10:38 AM

@Property Pundit - I stand to be corrected by those who know better, but I believe the 2008 crash caused the property market to crash, leading to a drastic fall in prices and many being left in negative equity. The same hasn't happened this time.

I think we need to wait a while to judge, given the full economic effects of the pandemic have yet to rear their head, but prices have largely held up so far and people seem keen to move - for more space, for a garden, to escape the city.

The banking crash, as devastating as it was, didn't lead to a change in the way in which we live - although it should have. The pandemic will. There will be a massive long-term rise in home-working, a further decline of the high street, a new, more flexible, more dynamic workforce. The safety net will need to be stronger than ever, particularly when the furlough scheme ends, as so many people will be in unemployment through no fault of their own. A repeat of the high unemployment and destruction of industry (with nothing to replace it) seen in the Thatcher years will not be accepted now, neither will a repeat of the austerity which followed the last crash.

People will travel much less and rely on public transport much less, which will have a dramatic impact on how we view our towns and cities. This 'normality by Christmas' rubbish was always complete nonsense, but it'll be interesting to see how the market copes as we enter winter and people become less willing to get out and about. The end of the furlough scheme and the end of the transition period could also have a significant impact.