The property website OnTheMarket has reported its first annual profit since being launched by a group of estate agents six years ago, as the UK housing market enjoyed a boom fuelled by working from home relocations and the stamp duty holiday.
The firm, which is 60% owned by agents, made a pretax profit of £1.1m in the year to 31 January compared with a loss of £11.7m the year before. Its revenues rose by 22% to £23m, helped by higher revenues from new home developments listed on the website. It advertises both lettings and sales, and counts 10 big housebuilders among its clients, including Crest Nicholson and Barratt, as well as thousands of estate agents.
This offset customer discounts of £2.6m to help agents get through the first coronavirus lockdown a year ago, when the housing market ground to a halt. Since then, the government’s stamp duty cut and help-to-buy programme have helped the market bounce back, as a shift to working from home led to demand for bigger properties with gardens outside big cities.
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The mortgage lender Halifax reported on Monday that the average house price reached a new record of £261,743 in May, as homebuyers raced to complete purchases before the stamp duty holiday is scaled back at the end of this month.
Visits to the OnTheMarket website rose 13% to 267m over the year, and it had 12,687 property advertisers at the end of January. The business was launched in 2015 to challenge the duopoly of Rightmove and Zoopla. It was founded by Agents’ Mutual, made up of Savills, Knight Frank, Chestertons, Strutt & Parker and the London firms Douglas & Gordon and Glentree Estates. In February 2018, OnTheMarket floated on London’s junior Aim market.
“Despite the unprecedented conditions we have faced, we have continued to grow the business and achieve profitability,” said Jason Tebb, who became chief executive in December. He expects the property market to stay buoyant even after the end of the stamp duty cut.
“The economic fundamentals still remain. There’s a low cost of borrowing and huge pent-up demand still, and very few properties on the market comparatively.”
Tebb added that homeowners were “becoming more comfortable about opening properties up” for viewings, with the Covid vaccination programme progressing rapidly.
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The company said it would repay the £449,000 it received from the government under the coronavirus job retention scheme.
OnTheMarket offers its members the option to fix the monthly fee for listing properties for five years, offering agents the chance to control costs in the face of what it has described as escalating fees from Zoopla and Rightmove.
Clive Beattie, the chief financial officer, said: “We don’t have any ambition to be as big as Rightmove or Zoopla because we don’t intend to charge as much.”
