Rightmove’s sales and profits defy challenging UK property market

Rightmove scored larger profits and turnover last year despite a major slowdown affecting the UK housing market.

Britain’s biggest property listings website reported its revenue grew by 10 per cent to £364.3million in 2023 thanks to price hikes and higher demand for its packages and digital products.

Advertisers spent an average of £1,431 per month on the London-based company’s platform, a 9 per cent increase on the previous year.

While margins were impacted by greater payroll, overhead and technology costs, Rightmove’s operating profits still expanded by 7 per cent to £258million.

The FTSE 100 firm’s performance was achieved against a more challenging backdrop for the housing sector, as the Bank of England’s continued interest rate hikes and cost-of-living pressures discouraged home purchases.

Mortgage rates eased somewhat at the start of 2023 before increasing during the spring and summer due to worse-than-expected inflation and then falling again over the latter part of the year.

However, they remained far above lockdown-era levels; the average two-year fixed rate peaked at 6.86 per cent in July, having been 2.34 per cent in December 2021, according to financial information provider Moneyfacts.

Consequently, one million properties were bought in the UK last year, compared to 1.2 million in 2022, data from Land Registry shows.

Rightmove said the average time it took sellers to find buyers lengthened from 37 to 59 days, while customers spent 15.4 billion minutes browsing on its platform against 16.3 billion the previous year, although this was still 27 per cent up on pre-pandemic levels.

Johan Svanstrom, its chief executive, said: ‘In a year of economic uncertainty, consumers continued to trust Rightmove as the place to turn to help them make their move.

‘Customers were able to choose from an expanded, more sophisticated product suite to continue to drive business results in a changing market environment.

In 2024, Rightmove expects its revenue to rise by 7 to 9 per cent, although it warned customer numbers were ‘likely to drop slightly’ because of economic uncertainty.

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: ‘Rightmove is the ultimate lesson in pricing power. 

‘Regardless of what’s going on in the wider market, whether it’s up or down, today’s estate agents can ill afford not to advertise on the site.’ 

Rightmove’s results come as Nationwide figures showed house prices grew by 1.2 per cent year-on-year to £260,420 in February, the first positive annual increase in 13 months.

Rightmove shares were 1.4 per cent lower at 558.8p just after midday on Friday and have slumped by approximately 30 per cent since the end of 2021.