Hemnet Group: Assessing the Balance Between Pricing Power and Listing Volume Risks in a Soft Market

Hemnet Group, Sweden's dominant real estate portal, has navigated a complex 2023–2025 period marked by strategic pricing innovations, regulatory scrutiny, and a softening property market. While its aggressive focus on value-added services has driven robust revenue growth, the company now faces critical questions about sustainability amid declining listing volumes and intensifying competition. This analysis evaluates Hemnet's strategic pricing discipline, regulatory resilience, and competitive moat to determine whether its high-moat positioning in real estate portals remains intact.

Strategic Pricing Discipline: Balancing ARPL Growth and Market Backlash

Hemnet's financial performance in 2025 underscores its ability to extract pricing power despite a challenging market. The company's Average Revenue Per Listing (ARPL) surged by 20.9% year-over-year in Q3 2025 to SEK 7,477, driven by the adoption of premium services like Hemnet Max, which offered enhanced visibility and performance metrics for sellers according to its year-in-review. Over the first nine months of 2025, net sales rose 14.4% to SEK 1,178.7 million, with EBITDA increasing 12.9% to SEK 613.8 million as reported in the same analysis. These figures reflect a deliberate shift toward high-margin offerings, such as Hemnet's "pay only upon sale" model, which aims to lower barriers for sellers while maintaining revenue streams as noted by Seeking Alpha.

However, this pricing strategy has not been without friction. Critics argue that Hemnet's aggressive price increases- ARPL rose 350% between 2019 and 2024-have outpaced perceived value, particularly as competitors like Boneo and Booli offer cheaper or free alternatives as Bloomberg reports. A Bloomberg report notes that Hemnet's stock fell 48% in 2025, reflecting investor concerns over declining listing volumes and the risk of being priced out of the market according to the analysis. The company's Q3 2025 results highlighted this tension: while ARPL growth remained strong, net sales dipped 1.5% year-on-year due to a 19.2% decline in published listings as detailed in the year-in-review.

Regulatory Resilience: Navigating Scrutiny and Compliance Challenges

Hemnet's dominance in Sweden's real estate market- 89% of properties sold in 2024 were advertised on its platform-has drawn regulatory attention. The Swedish Competition Authority and Real Estate Agency Inspectorate have raised concerns about Hemnet's pricing model and potential anti-competitive behavior according to official statements. For instance, the Inspectorate has not ruled out investigating Hemnet's new Hemnet Max product, which critics argue reduces transparency and could distort market dynamics as reported by Marketscreener.

In response, Hemnet has introduced compliance measures to mitigate regulatory risks. The "sell first, pay later" model, set for a 2026 rollout, aims to align pricing with market realities by deferring payments until a property is sold as announced by the company. Additionally, the company has strengthened its ethical framework, including mandatory employee training on data privacy and anti-corruption policies as detailed in its sustainability strategy. These steps signal a proactive approach to compliance, though the long-term effectiveness remains untested as regulatory scrutiny intensifies.

Competitive Moat: Network Effects and Brand Strength

Hemnet's competitive advantages remain formidable. Its network effects are unparalleled: listings on Hemnet receive 19 times more views than those on competitors, creating a self-reinforcing cycle of user engagement according to business analysis. The platform's brand strength is further bolstered by its integration into Sweden's housing ecosystem, with 94% of real estate agents relying on its services as noted in the same analysis. Hemnet's financial metrics also underscore its moat, with adjusted EBITDA margins exceeding 52% and incremental margins supporting reinvestment as detailed in the study.

Yet, these advantages face growing challenges. Competitors are leveraging low-cost models to erode Hemnet's market share, and regulatory pressures could force structural changes to its pricing strategy. A Bristlemoon Capital analysis warns that Hemnet's rapid ARPL growth-4.5 times over five years-mirrors the FICO case, where aggressive pricing led to regulatory backlash according to the research. While Hemnet's "pay upon sale" model may alleviate some concerns, it remains to be seen whether it can retain sellers amid a fragmented market.

Conclusion: A Delicate Balance in a High-Moat Sector

Hemnet Group's strategic pricing discipline has enabled it to thrive in a soft market, but the company now faces a critical inflection point. Its ability to sustain ARPL growth while addressing listing volume declines and regulatory scrutiny will determine its long-term resilience. The introduction of flexible pricing models and compliance initiatives demonstrates adaptability, but these measures must be paired with a renewed focus on value perception for sellers and agents.

For investors, Hemnet's high-moat positioning remains intact due to its network effects, brand dominance, and financial strength. However, the risks of overreliance on pricing power and regulatory intervention cannot be ignored. As Hemnet navigates this complex landscape, its success will hinge on balancing innovation with market pragmatism-a test of its strategic discipline in a sector where dominance is both a shield and a target.