The ever-widening split between some estate agents and Rightmove is illustrated by the property portal’s interim results, published last Friday.
The stamp duty holiday, low borrowing costs and a desire for more space, helped boost the UK housing market during the pandemic.
The recent house market boom has now left a number of agents with a shortage of properties for sale, while Rightmove continues to cash in.
The property website saw healthy growth in average revenue per advertiser on its platform, and record low levels of churn or defections by estate agencies to other property portals.
Rightmove, which expects the trend for the rest of the year to “follow a broadly similar pattern”, said ARPA jumped 63% to a record £1,163 per month, up from £1,077 in 2019.
The company said operating profit came in at £114.9m for the six months ended June 30, compared with £61.7m 12 month earlier and £108.2m reported for the first half of 2019.
Anthony Codling, chief executive of PropTech platform Twindig, said: “It doesn’t pay stamp duty, but it benefitted from the stamp duty holiday, Rightmove’s are revenues up 58%, and it makes 76.5p pure profit for every £1 spent by its customers, safe as houses rich as Rightmove.
“Estate agents may be short of stock and first-time buyers struggling to get a foot on the housing ladder, but Rightmove has certainly found its happy place again.”
A somewhat misleading statement from Coddling unless his comments have been edited. Quoting RM’s revenue being up by 58% is based on comparing the first half of this year against the first half of last year which contained heavy discounts to agents due to the first lockdown. Revenue has increased by a modest 4% when compared against 2019.
Needless to say, its profit margins are obscene.
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The three agents I know have all told me they’re having record breaking years, one’s just bought himself a new Porsche so it doesn’t sound like its that tough for them???
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Agents can always walk away from RM but most realise that it works. An amazing business that quite rightly charges premium prices.
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Rightmove employee’s commenting on posts really should come with a disclaimer.
It’s not an “amazing business” for anyone other than their shareholders.
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I don’t think many or even anyone has a problem paying premium prices to premium suppliers . RM sales tactics and upselling processes are designed to maximise revenue from agents with no way back to the original price point . Little or no innovation to improve the offering or provide any form of value add to go with the annual cost rises that have been out of kilter with inflation and purely predatory . RM are not a premium supplier in any way shape or form. telling agents you will go bust if you don’t stick with the full package etc or I will notify your competitors If you reduce you package or come off RM etc etc is all part is the proof that premium is not a tag you can comfortably put on the RM supplier agent relationship . Estate Agents can reverse the balance of power if They really want to
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If you compare 30 June 2021 with 30 June 2019 – they have lost 716 EA Branches.
Over the same period the income from EA Branches has increased from £104.8million to £109.6million (4.6%) which means that the average fees have risen from £521 pcm to £569 pcm(10.9%).
How many independent EA Branches pay £569 pcm ?
RM are using PR spin to hide the fact that their “Ratner moment” has cost them dearly.
As they lose the smaller independent EA, they have to increase fees disproportionately to those remaining.
They are eating their own tail.
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RM has now become a place for Corporate Agents and the silliest of the Independants.
Strong independands have already left.
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What happens when the tail has all been eaten ?
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We used to be a Rightmove customer but when we closed our sales business we left immediately. Our Lettings business has gone from strength to strength! If you are worried about leaving Tightmove and have Lettings as well, just give notice on lettings! You will see NO difference. Send people to your website, facebook or even another portal, but you will save money and have no risk of losing business.
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“Send people to your website, facebook or even another portal”
I’m sorry – but why, if you have already engaged with these people, would you then “send them to another portal” where your listings become an insignificant hum in the cacophony of noise?
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It’s funny that all these stories of “liberation” always follow the same narrative. “Send them to X, Y & Z for your properties”
As if the agent in question is the holy grail of property listings.
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Kyle
Please talk me through your comment – apologies if I’m missing something obvious, but I’m not getting the point somehow.
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That’s great to hear you haven’t noticed any difference, I’m close to giving them notice as lettings only.
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I’m one of those that left in 2019, sales and lettings, using ZP instead at a quarter of the cost, zero drop in enquiries. The only actual loss I’d say is access to their best price guide stuff, which was handy, though we’re doing just fine without.
I’m in a major city, Manchester, most other agents are with RM.
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@jsmcr agreed wholeheartedly, we left in 2019 and haven’t looked back as a Lettings only business. In fact we are having one of our best years for valuations and take ons. Social media and Zoopla, who are far more realistic with their pricing for something that works) is where it’s at for Lettings (not FB Marketplace on SM, but your own advertising).
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We replaced the RM reports, which every other agent was using, with a Sprift Report which blows everything else out of the water.
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Is there anything Sprift can’t do that the best price can?
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I can’t think of anything!
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After moving from Optimiser to the Essentials package across all my offices RM increased my costs this year by just under £5k. No reason given, no explanation, just ‘one of those things’. We have experienced zero difference between Optimiser and Essentials (except the savings!).
My view is that portals should be considered a secondary source of enquiries, our website and social should be the primary methods to generate interest as they promote us rather than a third party.
The increase frustrates me. I am thinking about cancelling RM on a few offices for a few months until I save the increase. Rather than pocketing the difference myself I would donate the savings to a suitable NHS charity. If I see no difference we could cancel RM completely. It may also make RM think about future increases (unlikely though!). If other agents join in we could generate millions for the NHS and take that first step away from portals.
Thoughts?
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Always interesting reading comments on rightmove. I’m assuming that because Apple is worth over $2 trillion all of you refuse to use their phones because of the profit they generate??
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An iPhone doesn’t cost £1000 a month. Dimwit.
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I don’t have any Apple products, what’s your point? Apple’s profit margin is circa 42%, RM 65%+ and constantly increasing pricing despite no innovation or new tech, so how do they justify it?
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Never had any Apple stuff
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What chances do agents have walking away from RM?
Well respected agent recent took his properties off RM for an experiment, public did not care or notice but a charming competitor went out of their way to wind his clients up so he was in effect forced to go back on RM.
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‘Well respected’ agents tried that on me. So I started to point out the unsold properties on ‘well respected’ agencies books. All being marketed on RM.
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Our competitors are a little way off being ‘well respected’ but they’ve tried this for months whilst ignorning that facts speak for themselves. Every property we have sold for happy customers since early 2020 has been without the need for rightmove. We’ve got ZPG and OTM, our shop window, boards, facebook, twitter, insta, phones to call people on, chatty customers and good service. It’s not a mystery!!!!
The other agents can’t understand it so they’ve given up on that angle a bit and doubled down on fees. Lowest we’ve heard of so far is 0.5% in a market of many homes over £300k and where we mainly get 1.2% and never lower than 1%.
We just keep ploughing our own furrow.
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Agreed.
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Two loaves of bread, and a jar of blackcurrant jam, and a box of your finest cigars.
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