Rightmove’s share price has plunged 10% in a week when it is under fire for raising the fees agents pay.
The portal’s share value has dropped 45% in the last six months, and 13% in the last month alone to around £4.45. Exactly a year ago the share price stood at £6.68.
Out of business
Earlier this week, independent agents warned they will go out of business if Rightmove ploughs ahead with proposed fee increases of up to 18% this year.
In a letter to Rightmove copied to The Neg, Debbie Walley, Director at Winterbrook Estates in Wallingford, Oxfordshire, told the portal its latest fee hikes put the business at serious risk.
Cut costs
“We are a small, independent estate agency operating in a small town, competing with over seven other agents. To stay afloat, we have already been forced to cut costs and reduce staffing.
“We now face the real risk of going out of business,” she said.
The portal’s share price nosedived in November following its latest trading update which revealed it is planning to spend £60 million over three years on AI and product development that would impact profits.
Legal action
And it is facing a group legal action seeking to recoup “excessive and unfair fees”.
The legal action, which is being led by former Competition and Markets Authority (CMA) panel member Jeremy Newman, hopes to recoup fees on behalf of participating estate agents that could reach £1 billion.
Rightmove forecasted 8–10% revenue growth and 3–5% profit growth this year as it moves through what it calls an “investment phase”. The additional spending, it said, would support “double-digit profit growth” in later years.
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