Mortgage mayhem is becoming a downer for London-listed online property portal Rightmove PLC (LSE:RMV), which fell 2.3% on Tuesday, making it one of FTSE’s worst daily performers.
As Britain’s largest property marketplace, Rightmove sources revenues from estate agents and private landlords who want to advertise their available properties online.
There are fears that dwindling profits in the buy-to-let sector will soon cause an exodus of landlords from the market, bringing large swathes of rentable properties with them.
This is likely to cause a downturn in Rightmove’s revenues as fewer agents and landlords seek to put their homes on the rental market.
Surging base interest rates have hit mortgage holders where it hurts, with the average two-year mortgage rate surpassing 6 this weekend.
Per Rightmove’s own data, the average two-year fixed-rate mortgage at a 95% loan-to-value ratio was 6.36% today, up from 6.22% this time last week and more than double year on year.
However, Rightmove’s Matt Smith today noted that the number of people contacting estate agents about a home for sale remains above pre-Covid levels, “meaning that right now, the data indicates that higher rates are not stopping many people from planning their move”.
Rightmove shares were changing hands at 518p as of 4pm, June 20.