Rightmove, the UK’s largest property portal, is the target of a takeover bid this month. The bidder is REA Group, which operates Australia’s largest property website as well as other real estate businesses around the world.
So far, no agreement has been made to sell Rightmove. On 10 September, the platform rejected a £5.6bn bid from REA, saying that it was “wholly opportunistic and fundamentally undervalued Rightmove”. Now REA is reportedly considering an improved bid, and has until 30 September to make one.
If REA’s bid fails, Rightmove could still attract attention from other buyers, with some analysts predicting that private equity firms could swoop in. Rightmove is Britain’s most dominant property portal. According to the company’s own stats, 4 in every 5 sales and 3 in 4 lettings result from a lead submitted via Rightmove, meaning that any change in the way it works would affect almost every agent, buyer and seller in the UK. That market position has made it the most profitable company in the FTSE 100.
Could fees go up?
Industry watchers are divided on how a REA takeover could affect platform fees. In REA’s Australian home market, the platform operates a pay-per-listing fee structure – and agents hand over £750 to £1,500 per property, compared to an average of under £250 in the UK. Moving Rightmove to a pay-per-listing model would be a radical change in the way the platform works.
On the other hand, BestAgent founder Charlie Lamdin argues that taking over and delisting Rightmove from the stock market would reduce the pressure on the company to keep raising fees.
Despite its widespread use, the platform has already attracted criticism from agents who say that its fees are too high, and during the pandemic a customer revolt caused the platform to slash the amount it charged users.
A big fee hike could encourage agents to look elsewhere. OnTheMarket has reported strong growth since its takeover by Costar Group at the end of last year, while long-term number two Zoopla could also benefit if agents jump ship. Agents will be watching with interest to see what happens next.
Other estate agent headlines:
The Property Finance Group eyes more deals after posting record results – Estate Agent Today
Estate agents waste hundreds of hours a year conducting viewings for time wasters – Property Industry Eye
Buyers demand government takes action to make house purchases less stressful – The Negotiator
