Rightmove paints upbeat picture as customer numbers grow

(Sharecast News) - Property portal Rightmove has reiterated its revenue and profit guidance for the full year, but upgraded its customer growth expectations after a strong start to the year. The company also gave an upbeat outlook for the wider housing market, with both sales agreed and lettings activity up significantly on last year.

Rightmove said it now expects customer numbers to grow by up to 2% over 2024, compared with previous guidance of a slight decrease. Net membership has increased by around 250 since the start of the year, due to strong agent retention and strong growth in the lettings market, where it saw 170 net growth.

However, average revenue per advertiser (ARPA) growth has been cut to £75-85 from last year's £1,431, down from prior expectations of a £100-110 increase, as lettings-only estate agents typically have a lower ARPA.

The strong growth of new home developments being added to the portal through housings associations has also weighed on the outlook for ARPA since housing association ARPA is lower than for mainstream new homes developments.

Nevertheless, the company has stuck with its full-year revenue growth guidance of 7-9%, while the underlying operating margin target of 70% remains unchanged.

Regarding the wider market, Rightmove's most recent House Price Index showed average asking prices rising by 1.1% month-on-month, with annual house price growth at a 12-month high of 1.7%.

Sales agreed between January and April 2024 are 17% higher than the same period last year, while the company noted an 18% increase in rental listings availability in the first four months of 2024.

"Overall, we continue to expect a better year for the UK property market in 2024 than in 2023," said chief executive Johan Svanstrom. "We remain confident in achieving a year of good financial and strategic progress and are focused on driving further long-term platform growth."