UK Housing Market Sees Record High Stock, Hurting Developers

UK property portal Rightmove reports a 10-year high in available housing stock, creating a buyer's market and pressuring new home developers. UK house prices fell in June, and developers face delays in planning approvals and difficulty finding investors. Despite this, Rightmove's first-half adjusted operating profit was ahead of expectations, with guidance for 8%-10% revenue growth this year.

UK property portal Rightmove has reported a significant increase in available housing stock, reaching a 10-year high. This development has created a buyer's market, exerting pressure on new home developers. According to Rightmove, house prices in the UK fell in June, and developers are now facing delays in planning approvals and difficulties in securing investors.

Despite these challenges, Rightmove's first-half adjusted operating profit exceeded expectations. The company's revenues rose by 10% between January and June, reaching £211.7 million. Operating profit increased by 10% to £145.4 million, while underlying profit rose by 9% to £151.3 million. The underlying profit margin also improved by 2% to 71%, attributed to planned growth-focused investments [1].

Rightmove's average revenue per advertiser (ARPA) increased by £112 to £1,609, driven primarily by a £153 rise among property developers advertising new homes, which increased to £2,093. Estate agency ARPA rose by £103 to £1,520. Total membership numbers improved by 1% from the mid-point of 2024, reflecting strong estate agent retention and the creation of new agencies. The company noted that agent formation returned to levels not seen since 2020, indicating a more conducive market for new entrants [1].

Rightmove maintained its full-year sales growth guidance of 8%-10%, with an expected underlying operating profit margin of 70%. The company also predicted a 1% uptick in membership numbers and ARPA growth of between £95 and £105 across Estate Agency and New Homes developers. However, it acknowledged that second-half revenues growth will likely be lower than the first half, reflecting the record sales printed in the corresponding 2024 period [1].

Analyst Mark Crouch of eToro commented that Rightmove's "structural moat" and brand strength make it the "only game in town" for agents, despite potential pricing grumbles. He added that a slowdown in the UK housing market could actually strengthen Rightmove's position, weakening smaller competitors trying to enter the market [1].

References:
[1] https://www.forbes.com/sites/roystonwild/2025/07/25/rightmove-dips-1-as-ftse-100-property-lister-predicts-sales-slowdown/