Rightmove predicts property market return to ‘pre-pandemic levels’ this year

Rightmove has said 2021 was the busiest year in its 21-year history, with the tight UK property market driving up pre-tax profit by two-thirds.

The operator of the UK’s largest property website said on Friday that it expected UK real estate transactions to decline and return to pre-coronavirus pandemic levels this year, but was still confident of robust growth.

The FTSE 100 group said record numbers of people spent more than “18bn minutes on our platforms” last year, as potential home buyers shrugged off soaring inflation and the higher cost of living in the search for a property.

“As the market normalizes, we expect the number of transactions to return to pre-pandemic levels,” the group said in a statement. “We remain alert to the macro environment, but Rightmove is not materially impacted by the property market cycle other than in the most extreme circumstances.

Rightmove reported that annual pre-tax profit rose 67 per cent year on year to £ 226mn, on revenues that rose almost 50 per cent to £ 305mn.

The bulk of Rightmove’s revenue comes from agents who pay a fee to list properties on the site. The company, which has attracted criticism from a group of independent estate agents who have complained about its fee model, reported an operating margin of 74 per cent.

Average revenue per advertiser – a crucial industry metric – rose 53 per cent year on year to £ 1,189 per month. A final dividend of 4.8p per share, up from 4.5p in 2020, took the total payout for 2021 to 7.8p.

The positive outlook followed recent data showing the price of homes coming to market in the UK hit a record of almost £ 350,000, up £ 7,800 between January and February, according to data from Rightmove. The 2.3 per cent rise was the largest monthly increase since the company started tracking national prices in 2001.

Rightmove shares rose 3.5 per cent in early trading to 636.2p.