Rightmove buys back own shares all this week

Chris - you claim "...over the last 5-years, not one agent has ever sold one of our properties, yet we have sold hundreds of theirs.". Also, you state "...but we set up our business to generate some serious income for 5-years and then retire anyway." Boy - the Estate Agency profession will no doubt miss your wealth of experience in the field - not to mention all those poor future vendors, unable to sell with any other Agent who will not be able to turn to you in their hour of need to find them the buyers you have on exclusive rights basis. Yeah, right.

• 04 January 2010 13:25 PM

Jimmy, I'm slightly concerned to be honest, but we set up our business to generate some serious income for 5-years and then retire anyway. That was 5-years ago, but the ressession has put us back a couple of years! A few more years to go now and I think the industry can hold together till then!
In the same way that the internet (Rightmove etc.) has helped us, for the large majority of us, we are what the Compact Disc is to ITunes, our days are numbered. Anyone that doesn't accept this dreaming.
The best way to protect our industry and give it greater mileage until the inevitable happens, is to only support the likes of Rightmove/ Google if they agree to keep Joe Public off their site and only deal with the agents. If agents stick to Rightmove or sites that only support agents, Google won't get off the ground quite so quickly. Honestly though, the selling process will return to an up-front fee selling process as apposed to a no-sale, no-fee basis, which as we all know drives up the fees for those that do sell. With HIPS, it's nearly there anyway!

• 03 January 2010 19:34 PM

Chris - I think you're absolutely right. Very refreshing viewpoint actually. How do you think you'll fare if / when Google move in?

• 28 December 2009 22:55 PM

Oh and I forgot to add, because I can hear people say it already. Estate Agents don't really need Rightmove. They can sell property well without them! Well this is rubbish and this is why. I operate a small internet based Estate Agency in the East Midlands. I have 32 competing Estate Agents on my door step, most of which operate on the high street, while I operate well away from the high street and in a given week we will have only one or two visitors. We only use Rightmove to advertise our stock and over the last 5-years, not one agent has ever sold one of our properties, yet we have sold hundreds of theirs. Honestly. Some good photos, excellent and informative write-up's with floorplans etc. means that buyers spend more time reading our material and call us instead of the other agents. I constantly hear them shout about how great they are and how big their office is on the high street, but they can't sell them quicker than me, in my tiny office miles from anywhere! Don't knock Rightmove, they have world domination in the online property market and they like Estate Agents! :)

• 28 December 2009 22:01 PM

The Internet is a powerful thing these days and without the strong stance from Rightmove in favour of Estate Agents, this business of ours will have gone down the pan years ago.

Allow me to explain.

Rightmove does not allow members of the public to advertise their own properties on Rightmove, thus avoiding going through an Estate Agent.

They state that because of the Property Misdescriptions Act, an agent must measure/ photograph each property being advertised on the site and is therefore responsible for the accuracy. Fair enough I hear you say. It is because of this that many homeowners pay us the privilege of using agents.

With Rightmove, we can generate them much more interest than if they use these cheap internet sites where they send in their own photos for a nominal £50 fee!

If a powerful site like Google allowed the public to sell their own houses, like they can on ebay, 60% of Estate Agents would close overnight! For that I am sure.

• 28 December 2009 21:50 PM

Thats a very fair point Brian. At the end of the day, if you don't want to pay RM, don't use them.

• 21 December 2009 14:20 PM

Tell EA to stop moaning? Don’t be silly its what they do best, like the worst vendor, nothing is ever their fault, too many were OK negs who without any business acumen or plan open up a shop and copy the herd which is why again the “profession” is top of the dislike pile just in time for Xmas. RM is always a target, perhaps jealous they actually have a sound business model??? Do something without charging is not good business, now how much do EA do everyday for Zero, nothing???

• 21 December 2009 13:20 PM

Rightmove have done more for this industry in terms of efficiently matching sellers up with buyers than anyone else.

They were just the start though and the model is about to change in one fell swoop. My suggestion to them would be to immediately copy Google's charging model or something similar otherwise they are dead.

This was always going to happen. The internet is getting better and better and, put simply, is a more effective way of matching a buyer up with a seller than a shop window.

It will be interesting to see how EAs respond to this. The better ones will understand what the true value is in their own service and allow the technology to release some efficiencies for them. My own view is that those that have been happily paying RM are the ones that understand this. RM is cheap for the work it does for you IMHO.

• 18 December 2009 17:15 PM

Lose the tunnel vision. You say that you have built remove up by putting their name on your material. However, they have delivered massive consumer confidence to potential customers you probably would never of had by them seeing your name associated with RM. Fact. RM is also BY FAR, the best, easiest and most user friendly portal for the user. If you are not happy with the fees, leave. If you are a good at what you do, you will still be a success. Arguably, Estate Agents fees are too high in the eyes of the public. Pay up or hush up. Simple.

• 18 December 2009 16:58 PM

rightmove rip us agents off, I really hope they collapse. They tie you down if you leave and go back they double their fees.

• 18 December 2009 14:45 PM

Market Maker:
Thanks.
Agents:
Stop moaning about RM fees. YOU and I built their success by giving them your and my business and free advertising of RM in everything YOU and I produce.
Do the same for PropertyLive and it will have the same success and cost you NOTHING!

• 18 December 2009 14:40 PM

A public company like Rightmove can only buy back its shares if (1) it has previously gained permission from shareholders to do so (2) it has the profits and cash to pay for them (3) it believes its share price is too low compared to what it will soon be

Stock exchange rules prevent a public company from carrying out share buy backs in order to support its share price. The act of buying back shares is generally seen as confidence in the future as the company looks pretty stupid if it has overpaid for its shares.

Company law prevents a company from selling its own shares to anyone without having got shareholder approval (this is known as doing a rights issue where the existing shareholders always have the opportunity to subscribe for the new shares so that they can avoid having their share of the company reduced.

When a company buys back its own shares they are cancelled, meaning that future dividends get shared around fewer shareholders. This is a method of returning money to shareholders rather than or in addition to paying dividends.

Share purchases and sales by management of a company are different from the company itself. Each has to be reported but they are reported specifically as one or the other.

In 2008 Rightmove bought 11.9m of its own shares at 378p compared to 480p now. The fall in the share price following the Google news may be seen as another chance to buy cheap.

This is the reverse of "decreasing circles" Watching It. Companies in trouble stop buying their shares and just concentrate on paying their dividend if they can even manage to do that.

• 18 December 2009 14:01 PM

I believe they are buying back with what they have just made. Most of the top jollies sold just before I would imagine RM sold a big chunk too.

Effectively they just made a few £million in a few weeks, nice work if you can get it.

• 18 December 2009 11:55 AM

RM do not dictate their market (which is the 'click' market, not to be confused wit the property market). I watch with interest because no matter what anyone in our industry says, thinks or does, if Google out advertise RM and the public stop clicking RM they have no business whatsoever. Their shares would be worthless. I also believe if RM attempted to increase revenue through private listings the moment their 1st private listing went on 95% of their agents would cancel subscription that day, again, leaving them with no business whatsoever. I just think it is interesting to watch.

• 18 December 2009 11:20 AM

I agree Michael. RM never held a gun to anyones head. If agents chose to pay those fees for years, then they really should look in the mirror. However, markets are markets. Whilst RM got away with great profits in a certain market, theu have to be aware that changing with a market is essential to survival. It seems as though RM took a bullish strategy last year. Has that now come back to haunt them?

• 18 December 2009 10:36 AM

Why are we agents so keen to knock a company that has helped so very much in getting our product out to the market place ? I don't like their fees much & won't pay extra to have my logo on the site etc (which I feel should be included)but they don't deserve as much attack as they have had.
In a way, they too are middle-men just like we are. Everyone is keen to cut out the middle-man & at least Rightmove restrict their advertising to agents only, where they could perhaps gain a lucrative fee by opening it up to the general public ... though I agree, agents may then walk in droves !

• 18 December 2009 10:17 AM

Buying their own company shares in the market seems to me a futile activity.

Rightmove, as well as the agents that support it should know that the property market is house-price led.

Above market-value prices slow the market. Below market-values prices stimulate the market.

Estate agents that don't realise this and are closing-up have only themselves to blame.

• 18 December 2009 10:11 AM

Will it implode?

Are they using the extortionate fees we pay them in an attempt to buy themselves out of trouble. Will it work?

Will this mean an attempt to extract higher fees from agents to pay this back?

OR

Are they using their advertising budget, their development budget salary budget or some other budget?

Will this mean decreased service?

Could they be using the fat profit already plundered from us Agents to try and pull this escape act off?

Are their projected profits in decline?

Are we watching the slow death of a giant?

Ever decreasing circles springs to mind!

I watch with interest.

• 18 December 2009 10:03 AM