Property listings website Rightmove (RMV) fell 3% to 571.6p as it reported unprecedented levels of activity on its site as the housing market moved out of hibernation but also said it would extend discounts for its estate agency client base.
Upstart rival OnTheMarket (OTMP:AIM) gained 5.4% to 82.75p as it provided its own update and also extended its cut-price offer to agents.
Rightmove said it would continue to offer discounts to customers through August and September as the Covid-19 crisis weighs on home sales.
Rightmove had already offered all of its agency and new homes customers a 75% discount between April and July.
The financial impact of the extended support over August and September would cut revenue by £17-£20 million, in addition to the £65-£75 million revenue impact of the discount for the period April to July.
Rightmove said home hunter demand following the reopening of the housing market has been strong.
'We have seen all 10 of our busiest days ever on the platform since 13 May,' the company said. 'We have also seen the 10 days with the most leads sent over the same period.'
OnTheMarket said it had extended a payment support initiative for agent customers to help ease the continuing impact of the Covied-19 crisis.
EXTENDED DISCOUNTS
An initial three-month discount on listing fees meant to expire on 25 July had been extended for another two months, to 25 September.
The discount would remain at 33% for the first month and would be 20% for the second month.
'While revenues will be impacted in the short term, the group will continue to conserve cash through the careful management of costs,' OnTheMarket said.
Shore Capital analyst Roddy Davidson said he is ‘cautious on the extent to which the group will be able to restore its (currently discounted) pre-Covid pricing structure given this economic backdrop, evidence of agent dissatisfaction (witness the growing profile of the Say No to Rightmove campaign -claims to represent agents with upwards of 3,300 offices), and our contention that other portals, particularly OnTheMarket, offer a significantly lower cost yet increasingly comparable alternative.’
His counterpart at Numis, Gareth Davies, observed: ‘Extension of customer offer for August and September should not be a major surprise and looks the right thing to do for long term customer relations.
‘Customer numbers more resilient than we had feared (so far) and actually provides a little upside risk to our operating assumptions into H2.’
