Property website’s listings fall, shares tumble
Shares in the company, which owns Australia’s most popular property website, have tumbled after warning listings could fall by up to three per cent this financial year.
Realestate.com.au owner REA Group said on Friday that national buying listings fell six per cent in the first half and forecast a decline of one to three per cent for the full year.
January listings were down eight per cent compared to the same month last year, with major markets Melbourne and Sydney down one per cent each.
REA Group said there were also larger-than-expected declines in Perth and Brisbane.
The company’s shares were down nine percent at lunchtime to $166.03, the lowest since late 2023.
(Susie Dodds/AAP PHOTOS)
REA Group’s new CEO Cameron McIntyre says Australia’s property market is healthy, supported by strong employment levels and population growth.
“Although we have seen a rise in interest rates this week, the possibility of interest rates rising has already been widely flagged and the fundamentals of the market remain very strong,” he said.
Supply has increased in Melbourne and Sydney, but some sellers have delayed listings due to limited stock in smaller capital cities.
“Anecdotally, our customers across the country are telling us that they are seeing very good numbers in terms of exposure to inspections, which aligns with the view of the buoyant level of demand that we are seeing,” he said.
REA Group generated revenue of $916 million in the first half, up five percent on the previous year, while underlying earnings before interest, tax, depreciation and amortization rose six percent to $569 million.
Net profit rose nine percent to $341 million.
REA Group announced that it will distribute a temporary dividend of 1.24 percent, an increase of 13 percent compared to the previous year, in addition to a share buyback of $ 200 million.
But RBC Capital Markets analyst Garry Sherriff said the company’s update was negative and the results missed consensus estimates.
“Looking ahead, higher interest rates are generally a negative for new listing volumes,” he said.
Mr Sherriff said US-based commercial property company CoStar, which bought Domain for $3 billion in August, remained a “trespass” for REA because CoStar’s founder was now in Australia.
But REA Group said it was very pleased with the outcome and had launched a number of AI initiatives, including interactive search, through a partnership with OpenAI.
But so far traffic from ChatGPT has been “very small and that rate has decreased, not increased, recently,” Mr. McIntyre told analysts.
“You’re talking about less than one percent in terms of how we think about it going forward.”
Australia’s Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national news channel and has been providing accurate, reliable and fast-paced news content to the media industry, government and corporate sector for 85 years. We inform Australia.
