UK house prices: Rightmove share price jumps as it absorbs business from rivals

 
Emma Haslett
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The boom in house prices continued to help Rightmove (Source: Getty)

It seems the launch of an estate agent-run portal which forces agents to choose between Rightmove and Zoopla has done no harm to the former, after it reported a 16 per cent rise in revenues during the first half of the year.

The figures

The housing boom continues to benefit Rightmove: revenues rose to £93.1m in the six months to the end of June, up from £80.4m last year.

Meanwhile, underlying operating profit rose 18 per cent to £70.3m, up from £59.6m last year. That pushed underlying earnings per share up 24 per cent to 55.2p, from 46.8p the year before.

Not surprisingly the number of residential property listings on the site rose to 1.1m, 10 per cent higher than last year and "50 per cent more than any other portal", it claimed. It reported a more modest rise in agency and new homes customers, which grw one per cent to 19,590.

Still, investors were pretty happy with those figures: shares rose 3.45 per cent to 3,507p in mid-morning trading.

Why it matters

As house prices have increased (and, despite various attempts by George Osborne to cool the market, they have - a report by estate agent Haart earlier this week showed homes for first time buyers had risen £138 a day in June), the competition among online property portals has heated up.

The rivalry between arch nemeses Rightmove and Zoopla, the two biggest players in the market, was made even worse at the beginning of this year by the launch of a third portal, run by estate agents: Onthemarket.com. One of the conditions of being a member is that estate agents must choose between Rightmove or Zoopla to list their properties on. Cue a frenzy of estate agents flipping coins to try to work out which one to choose...

The winner is becoming increasingly clear, though: in May Zoopla admitted its membership had fallen 16 per cent in the six months to the end of March. Pretty damning, considering the figures Rightmove unveiled today.

Still, the company faces some challenges: with the housing crisis in full swing, estate agents have reported that the number of properties physically coming to market has fallen - those Haart figures showed the number of homes available had dropped 15.8 per cent in the year to June.

Still, Rightmove seems to be weathering any storm convincingly. No wonder shareholders were impressed.

What Rightmove said

Rightmove's brand awareness is extremely high; however the true strength of our brand is revealed by the depth of connection that the public have with it. Rightmove is seen as indispensable support for all those looking to make decisions around property, highlighted by our top 10 UK website ranking and an independent survey showing that over 90 per cent of home sellers expect their property to be marketed on Rightmove.
We are trusted and knowledgeable and support home movers, enabling them to feel confident, inspired and in control. To cement our position further we have continued to invest in our "find your happy" advertising campaign which connects with the strong positive emotions that moving home often generates and reflects our position at the heart of it.

In short

In the battle of the property portals, Rightmove is showing all the signs of winning.

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