Homebuyers’ queue lengthens as Rightmove profits improve

Spurred on by the stamp duty holiday and an increased emphasis on quality of life and working from home, the number of people looking to buy property continues to grow.

Demand is so high at the moment that many people are finding themselves in a huge queue of purchasers currently trying to buy property.

New data revealed today from Rightmove, which announced its unaudited results for the six months ended 30 June 2021 this morning (see below) shows that the likelihood of sellers successfully securing a buyer in the current market is at its highest point at any time over the past ten years.

Almost seven in ten homes – 68% – across Great Britain have found a buyer in the current market.

On average just over half – 53% – of properties up for sale successfully found a buyer between 2012 and early 2020, highlighting the strength of the market over the past 12 months.

Scotland has the highest sales rate in Great Britain at 89%, while London saw the lowest with just under half – 48% – of homes being sold

The research has identified the top ten places where people were most likely to successfully sell their home are all in Scotland, with the top three being Falkirk (94%), East Dunbartonshire (94%) and South Lanarkshire (93%).

Outside of Scotland the top three are Sheffield (83%), Craven (81%) and Chorley (81%), while the areas with the lowest sales rate are Westminster (22%), Kensington & Chelsea (25%), and Camden (28%).

Tim Bannister

Tim Bannister, director of property data at Rightmove, said: “There’s been a much greater chance of a seller finding a buyer over the past year, which really highlights the sheer number of people who have been determined to move.

“While the long-term average shows that typically around half of properties sell, the increase in 2021 reflects the frenzied buyer activity we’ve seen in the current market, driven by multiple factors such as pent up demand and changing priorities.

“This efficiency in the market means agents are operating on limited stock, and they need more homes to satisfy all types of buyers. We’ve seen from previous research that Scotland often contains the most likely areas to find a buyer, and London the least, however the broader numbers are reflective of the trend we’ve been seeing all year, which is that buyers have widened their scope, and the popularity of every area in Great Britain is increasing.”

 

Related news 

Rightmove plc, the UK’s largest property portal, today announces its unaudited results for the six months ended 30 June 2021.

Financial Highlights

H1 2021

H1 2020

H1 2019

Change vs 2020

Change vs 2019

Revenue

£149.9m

 £94.8m

£143.9m

+58%

+4%

Operating profit

£114.9m

£61.7m

£108.2m

+86%

+6%

Underlying operating profit(1)

£117.1m

£61.4m

£111.0m

+91%

+5%

Interim dividend

3.0p

2.8p

+7%

Basic earnings per share

10.8p

5.7p

9.9p

+89%

+9%

Underlying earnings per share(2)

11.0p

5.7p

10.2p

+93%

+8%

·    Revenue up 58% on 2020, reflecting the growth in customer spending and ARPA over the first six months of 2021.  Revenue is up £6m/4% on 2019, due to growth in Agency and Other revenues, partially offset by a decline in New Homes revenues

·    Operating profit of £114.9m, up 86% on 2020 (2020: £61.7m) and 6% on 2019 (£108.2m)

·    Underlying operating profit of £117.1m, up 91% on 2020 (2020: £61.4m) and 5% on 2019 (£111.0m)

·    Basic earnings per share up 89% to 10.8p (2020: 5.7p), underlying earnings per share 11.0p (2020: 5.7p). Compared to 2019, basic earnings per share up 9% from 9.9p, underlying earnings per share up 8% from 10.2p

·    Interim dividend for 2021 of 3.0p (2020: nil; 2019: 2.8p) per ordinary share

·    £128.3m of cash returned to shareholders through share buybacks and dividends in the first half of 2021 (2020: £30.1m; 2019: £54.0m)

·    Cash at the end of the period of £67.7m (31 December 2020: £96.7m)

Operational highlights

·    Average Revenue Per Advertiser (ARPA) up 63% to £1,163 per month, our highest ever ARPA (2020: £712; 2019: £1,077)

·    Relative to June 2019, Agency ARPA is up by £107 (11%), driven primarily by product purchases

·    Strong uptake of RM’s premium Optimiser 2020 package, with 16% of agents now subscribing to the package, up from 9% in December 2020

·    This strong growth in Agency ARPA has been slightly offset by the New Homes market, where high demand has reduced one-off marketing by developers

·    Membership numbers are broadly flat since the start of the year at 19,116; with 16,052 (+130) Agency branches and 3,064 (-211) New Homes developments (31 December 2020: 15,922 and 3,275; 31 December 2019: 16,347 and 3,462)

·    Rightmove’s position as the place home-hunters turn to first was further strengthened, with market share of time on portals at 90% (4)    

·    Time on site averaged 1.7 billion minutes per month over the period (2020: 1.1 billion; 2019 1.1 billion), reflecting Rightmove’s trusted brand and the strong property market.  Site visits of 1.4 billion (2020: 890 million; 2019: 845 million), up 56% year on year

·    Continuous innovation for customers with the launch of our Advanced Listings product for New Homes developers, which has already been taken-up by over 21% of New Homes properties on site 

·    Our new Online Conditional Auction advertising product, which demystifies the conditional auction process for home-hunters, is now live.  In response to the initiative, four additional auction providers will be integrated in Q3

·    Innovation to give home-hunters increased financial confidence earlier in their search process, through our online mortgage journey.  Potential borrowers sent over twice as many mortgage leads in H1 2021 as H1 2020, which have converted into three times as many Decisions in Principle as H1 2020.

Outlook

The first half of 2021 has delivered healthy ARPA growth, record low Agency churn and product innovation for both customers and home-hunters.  Strong growth in Agency ARPA – up 11% vs H1 2019 – has been driven by RM’s range of digital solutions enabling agents to compete effectively for new listings in the busy market.  The buoyant New Homes market has temporarily softened New Homes ARPA, by 1% relative to H1 2019.

RM expect the second half of the year to follow a broadly similar pattern, with good ARPA growth led by ongoing adoption of Optimiser 2020, broadly stable Agency branches and continued growth in our other businesses and the increased demand for properties continuing to impact the availability of New Homes development numbers.

Peter Brooks-Johnson, Chief Executive Officer, said: The first half of 2021 brought further lockdowns, instilling in many a desire or motivation to move home, and the nation relied on us to help them to find their new life, with a record 10.4bn minutes spent searching and researching on Rightmove. The innovation we have delivered to help home-hunters find their happy, despite the restrictions, have been well used – with 200,000 video viewings and 160,000 rental viewing appointments made on the platform.

Our customers expect our platform to deliver the best exposure for their brand, extremely effective advertising, and to help them to grow their businesses. The strong take-up of our premium Optimiser 2020 package shows agents’ continued belief in the Rightmove platform, as they invest in our digital products and innovative algorithms to help them to identify more opportunities to succeed.

Constantly innovating our platform and finding and developing the best people are at the heart of everything we do. We are committed to further increasing our diversity by promoting Rightmove roles to under-represented ethnic groups and the LGBTQ+ community, and we’ll continue to support all our people through our mental health and wellbeing programme.

I’m excited about the range of our plans – including our new digital mortgage and rental journeys – as we continue to help to make home-moving easier in the UK.”

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17 Comments

  1. Property Poke In The Eye

    Zzzzzz

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  2. Robert_May

    Just to be clear are Rightmove claiming all of that success blah blah blah is down to them alone or is that just implied gufferage for  investors?

     

    I now have the ability to  analyse traffic in a way no-one else has ever  managed and because of that can see all these numbers in a different light; on a per property, cost per engaged minute basis that is determined by what each agent pays to list.

     

    The numbers become very much less impressive when they are properly analysed.

     

    I appreciate my observations will irk their P11 fanbase and agents who cannot exist without their portal presence but now its possible  agents who are paying more and more to list less and less really ought to be looking forensically at  where their sales and lets are being generated and at what cost.

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  3. Budgie boy

    We left them a year ago, they’re overrated, overpriced and we haven’t missed them at all.

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    1. biffabear

      Left a year and 3 months ago. A few local agents have mocked me telling potential vendors I am not on RM. I quickly point back to their unsold stock, which is on RM.  Its a no brainer really.

      RM Should only be for corporate Agents. Indpendents need to find their b*lls and become independant.

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  4. Ostrich17

    So ARPA has increased to £1163 from £1077 in 2019.
     
    That’s less than 8% in 2 years !!
     
    You could interpret that as RM are struggling to hold on to members and are being forced by the “shouty” ones to freeze or discount pricing.  

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  5. silverfox

    And, just like sheep the majority keep following & supporting them.

    We left a year ago, absolutely no regrets in the slightest, we have a backbone, unlike others 🙂

    The maths don’t add up, low stock levels, huge demand for properties, so lets pay through the nose to a portal 🙂

     

     

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    1. Property Ear

      All well and good for you Silver Fox – result! But please answer this – My firm, a one office independent in a large West Country town with circa 18 agents, left in protest against high fees a year ago. No other agents left and when they got wind of our departure, word got round, we lost instruction after instruction and our pipeline suffered badly. Swallowing our pride, we quickly rejoined, our instructions recovered and we avoided a definite business failure. What would you have done?

      I cannot fail to advise that in a highly competitive arena, up until now, it’s all out or most out or, if you want to survive, pay up until the other guys have the courage to resign.

      Rob Sargent’s campaign could have triggered RM’s demise had he fired real bullets instead of blanks which was a pity, many of his supporters would have followed had he taken the jump.

      Robert May is on to something today with his reference to so few instructions questioning the need for RM.

      If this dearth of instructions  continues, it could well sign the death warrant for the goose which, following its latest price hike, could have laid its last golden egg.

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      1. silverfox

        I am sorry to hear that Property Ear and yes, I can definitely confirm that we lost a few instructions initially, however when I truly believed in what I was saying to the customer (about Rightmove making no difference) I found that it actually gave us an advantage to say something different and it actually made me fight harder to the instruction because I really had to sell myself and company.

        All the agents say they are on Rightmove but what is unique about that? we started to say that we were on Zoopla and OnTheMarket, which not all the other agents were/are on.  I completely understand what you are saying and I too was a bit concerned but once I started to get the instruction and sold boards were going up, I found that the average vendor didnt actually care about what websites they were on, as long as they had heard of at least one big portal.  We are all conditioned to believe we ned Rightmove, when we actually don’t.

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      2. Property Ear

        With no angst towards my ‘thumb downer’, why? (Unless it was S.Fox who has already kindly commented). If you have an objective alternative take on this, please elaborate, it would be interesting and possibly helpful to know.

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        1. silverfox

          No thumb down from me 🙂

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      3. Robert_May

        At £1500 a month a typical branch was listing 37 properties at any given time, about out £40 a month, if listed stock drops to 30 the cost increases 25% to £50.

         

        If you’re a non geographic agent  with a bit of a deal on  fees paying say  £850/ 37 listed when listings reduce  your bill presumably reduces,  £23 a listing stays the same but instead of £850 the bill becomes £690 a 27% reduction

         

        Don’t think I’m knocking Rightmove just commenting that there is a lack of consistency and fairness that works very much against smaller #local agents

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        1. biffabear

          Independants should leave.
          Spend the money saved on marketing yourselves locally.
          The big firms cannot do that and end up being stuck with RM.

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  6. iainwhite87

    They will keep increasing ARPA until or unless agents say no . It’s the equivalent of player agents in football they take so much money out of the game and are only interested in increasing this take to the detriment of the game itself.

    it is a phenomenal business financially, as a supplier partner they are pretty awful.

    Agents have the power to change this.

     

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  7. LetsTalkProp

    Let’s re-title this article ‘Rightmove profits improve by sucking agents dry’ – Far more accurate!

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  8. JEL

    Awful company…I pray for the day one of the bosses at this company has a ‘Ratners’ moment and finally admit they’ve been taking agents for a ride

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  9. ferrisbueller

    RM are like an aging dinosaur, eventually they’ll be become extinct, just a matter of when. RM have been hugely successful, and their was down to their early entry as a portal, first mover advantage blah blah blah. However those figures quoted above are typical of our industry which has seen huge demand and growth   However whilst they’ve milked estate agents like a cash cow (and in some ways I don’t blame them), they have always been slow to adapt and never really truly innovated. Love or loathe them, but other portals, Zoopla, Boomin, and to a lesser extent OTM can differentiate their offering now, and will continue to do so. I still remember the likes of the music industry, hmv Napster etc, and the retail industry, Woolies and cerrain supermarkets etc, and search engines like Yahoo etc – it’s the innovators, the rebels, and the misfits that reimagine the industry and truly improve things. Let’s see what the next year brings, exciting times ahead .

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    1. Robert_May

      It will be understanding and common sense that drives change. The property industry is a  small data service industry; a people business not a portal business. The Windows 3.11/ Windows 95  way of doing things is long past it’s best before date. The tech that changes that is built and tested and as an industry we are getting past the denial and anger stage of change management.

      Rightmove is vulnerable to its own success and greed, it doesn’t have and cannot have what is necessary to fulfil its own projection and ambitions. They’re IBM and can’t do a thing about it

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