Upbeat estate agents return to web advertising

Published 10th Feb 2010

Estate agents are boosting their online property advertising in response to the rebound in the housing market, according to Rightmove, Britain’s biggest home search website.

Rightmove said that advertising had increased substantially in January and it reported a “healthy uptake” of new display ads in a further sign that confidence is returning to the housing market. As a result of the rise in advertising revenue, Rightmove said that it expected profits this year to be above present forecasts, provided that the market continued to perform well.

Its upbeat tone was echoed by property consultancies, which said that they had begun to spend more on internet advertising.

Patrick Ramsay, head of residential at Knight Frank estate agents, said: “Advertising is rising again, but it’s coming from a low ebb. Everybody cut right back last year and there’s now a stock shortage. As a result, everyone’s working harder to get across the message that they’re the best agent, and online is where people are.”

Property market commentators have suggested that Rightmove’s update was designed to assert its dominance in the search portal industry as Google ramps up plans to enter the market. The global market leader confirmed in December last year that it was preparing to launch its own property search facility this year. Rightmove responded with an announcement that it would use Google Maps on its site.

The update came as many mortgage rates continued to tumble after lenders stepped up competition. New figures from the Bank of England show that the average rate charged on mortgages that track the Bank base rate has fallen to a record low. The average charged for borrowers with a 25 per cent deposit fell to 3.63 per cent in January, from 3.92 per cent in December and the lowest since comparable records began in 1997.

Interest on two-year fixed-rate mortgages fell to a six-year low of 3.97 per cent, down from a high of 6.35 per cent in June 2008. But while lenders are becoming keener to attract customers, borrowers with smaller deposits are still being forced to pay much higher rates.

The Bank stopped collating information on 95 per cent loan-to-value mortgages in 2008 as there were so few on the market. There are signs that lenders are now readier to lend to people with smaller deposits, although there is unlikely to be a return to the abundance of 95, 100 and 125 per cent mortgages that were available before the credit crunch.

The number of deals on offer to purchasers borrowing up to 90 per cent of the value of their home rose by 26 per cent in January, while Nationwide Building Society said yesterday that it was reducing the minimum deposit required to qualify for its best rates from 40 per cent to 30 per cent on nearly half its mortgage products.

Source: ' Times '

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