All right. Good morning, and welcome to Rightmove's results for the first six months of 2024. I'm joined today by Alison Dolan, our CFO, and also Ben Winstanley, our head of IR. I wanted to share a couple of key messages up front with you. Our platform and network effects remain unrivaled. We remain the place that home movers come to in order to see virtually the entire proper U.K. property market, with now ever-increasing utility, coverage, and segmentation. Overall, H1 results have been in line with our expectations, strategically, operationally, and financially. Our financial guidance today is unchanged from the AGM trading statement in May. While we are in this room, operational delivery and indeed innovation for our consumers and partners continue at pace back at our offices and out in the field.
The underlying markets of property are starting to look more positive and supportive, but as usual, the market is operating at different speed within different subsegments, and we'll get back to this. So in that context, Rightmove's platform continues to demonstrate its strength. We saw a revenue growth of 7%, with the letting segment going up 12% year-on-year. ARPA of almost 1,500 GBP is tracking in line with our guidance for the full-year at 75-85 GBP growth. Membership is 1% higher compared to December 2023, driven by strength in the lettings market, offset by a reduction in developments as new homes developers have slowed new starts.
The consumer spent 8.3 billion minutes on the Rightmove platform, slightly higher than last year, and very much confirming our central position in the property ecosystem. We continue to deliver strongly in our core five business pillars for the business. Just a few examples here. In consumer, with more functionality and growing stickiness, we're accelerating our online valuation and Track a Property product usage, and we also now have over 40% of our email leads delivered from our app. Within core, our top packages in estate agency new homes are both seeing very strong take-up. In particular, we have almost 1,400 branches on Optimiser Edge, and we're looking to retire Optimiser 2020 towards the end of this year.
We saw a record number of net new partners within our lettings business, and we're progressing well on our rental operators and Lead- to- Keys business lines. For the strategic growth areas, we're doing great in the first half year, with more than double the number of mortgage in principle submissions year-on-year. 1-year sales growing very positively for the Lead- to- Keys product, which was recently launched, and that's within our rental services suite of solutions. And then, a first version of the new commercial landing page now gone live. The platform overall is strengthening every day. All of our tech teams are now using AI assistant tools for coding and seeing positive results. That really is an underpinning of future pace of innovation and efficiency.
We're pleased to have welcomed over 100 new people to Rightmove, which is now, as a firm, accredited as a The Sunday Times Best Place to Work. So let's turn to an update on the underlying property market. As a reminder, our digital platform model is very resilient to many swings in the property market. We enable further digitization and make use of our data scale advantage from a very central position in that market. What this table or slide sets out is a view of the current conditions. The sliders provide a view of metrics in H1 this year within a 10-year context, with the green blobs representing the current position and the arrows, our expectations of how it'll move from an outlook perspective. And then on the sides, you have the period high and low point years for each line within that 10-year period.
So as a reminder, both the market and our business model demonstrate some semi, some countercyclicality. So these factors, of course, do move a little bit differently. Now, just stepping through it briefly, in the first row, for consumer affordability, the backdrop is mixed. Rates remain elevated relative to recent history, and the typical five-year fixed rate is just under 5%, according to the latest mortgage tracker from Rightmove. As we all know, there are further expectations for lowering of the rates from BOE, and of course, the mortgage lenders will follow with that. That will indeed stimulate transaction. The remaining four sliders for the resale market show you that there's good buyer demand, sort of in a catch-up mode from last year, really, and with it, absolutely growing listings volumes.
Notably, though, from a new listings growth perspective, we're still only in the middle of the road in historical context. Sales agreed are recovering. That's helping agent confidence and, of course, the outlook on cash flow. Crucially, though, it still takes seven months from the first listing until completion of a sale, which is at the point at which our agent partners receive their payment. On lettings, continued price growth supports the agent commission pool. There's an ongoing increase in available stock and a tempering of demand in lettings, so it's tilting back just a little bit. There's still very imbalanced supply and demand picture. So structurally, that imbalance is very much in place. In new homes, in this part of the rate cycle, it does exhibit-...
The higher for longer outlook on the rates, with developers focusing on completing sales at existing sites over building new developments at pace and scale. Developers now also compete with larger resale listing volumes, as we can see on the platform. Now, we hear of and expect new development builds to trend more positively over time and as the environment improves for builders. Maybe as a general comment on the election result and what it means, we're certainly pleased that housing is high up on the agenda, and as we have been urging all along from springtime, actually. But the Labour government now really has sort of a proof in the pudding period from its clearly stated ambitions. So I'll share a little bit more detail on the three key sub-markets within the core business.
For resale, you can see in the top chart, we continue to expect an average year for housing transactions, just shy or about 1.1 million sales. Looking at our own data at the bottom left, you can see from an agent perspective, the market is resilient, with our House Price Index slightly higher compared to last year, and sales agreed volumes are 13% higher. So the outlook is improved compared to 2023, with both supply and demand indicators for the transactions on our site being higher compared to what it was last year. However, supply today, measured in available stock and new listings, is only in line with 2019, the last normal year. And as I said, elevated times to completion mean that there's a lead time from those positive agent pipelines and home transaction agreements turning into actual cash flow.
In our sentiment survey, which we have on the bottom right, we can see that agent partners are decidedly more optimistic compared to the previous period, but they're also not sky high and certainly not close to 100% yet. On to rentals. The top chart is a new way of displaying the imbalance between supply and demand that we talked about before. It shows the number of inquiries per available property on Rightmove since the start of 2019. So pre-COVID, the average was 8 inquiries. At the peak in 2022, this rose to over 30 on average. Today, the level of supply-demand imbalance is somewhere in the middle, with an average of 17 inquiries. Still quite a lot. So demand remains almost a third higher than pre-pandemic levels, predominantly as a result of affordability constraints in the resale market.
Supply-wise, we've seen a slight increase in new listings for rentals, but it's nowhere near enough. Looking through our data and doing some analysis, it suggests that 50,000 properties would be required to return to pre-pandemic levels of rental stock or 120,000 additional properties to limit rental price growth to be more aligned with the inflation expectations of around 2%. To date this year, we've seen around 7% price growth on rentals. So with our product suite and ongoing expansion, we cover an increasing amount of segments and needs and monetization opportunities in the large rental market. As a reminder, it generates as many or more moving events every year compared to the sales side of the market. Now, trading conditions for developers remain challenging.
A combination of affordability constraints for buyers, build cost inflation, and extended build and release times have put pressure on all players, but in particular, the smaller and medium-sized developers. You can see this impact in the top chart, which is the ratio of housing starts to completion, which was at its lowest ever level in Q4 2023, based on ONS data. Now, there are grounds for cautious optimism with the mentioned new government ambitious ambitions. No doubt, better affordability is another key parameter for activity to start happening. All the large corporate builders, all partners of Rightmove, maintain their public completion commitments, which, while in aggregate, are lower than the previous financial year. They're sort of expected to now be in trough levels and looking to recover into calendar 2025. So we set this out at the bottom left on this slide.
Now, in terms of Rightmove products, we saw a good recovery in the number of developments using our Coming Soon product, which is on the bottom right. Coming Soon is a no-cap product for when boards first go up around a future site, so it's kind of a lead indicator for fuller development spend. The quarterly trend is positive, but I would note that there was a bit of leveling off around the election and in the early weeks of July, perhaps also influenced by football, so it feels early to call it a wholesome recovery for sure. So just summarizing the market backdrop. Continued strength in consumer willingness to transact should be supported as rates hopefully start falling, and the overall market, including pricing, remains stable.
We think that resale agents will see an average year, transaction-wise, with a notable bounce up from last, but cash flow effects still lagging as a result of the lengthy completion timetables. Rental agents continue to benefit from a relatively elevated supply-demand imbalance and therefore pricing strength. New homes, absolutely slower for longer, but grounds for optimism reflected in completion projections in the initial political commentary that we just had. With that, over to Alison.
Thanks, Johan. Morning, everyone. Lovely to see you all. Right, on to the results.
So revenue has increased by 7% on the first half of 2023, with growth across all areas of the business. Now, in this slide, we've kept the same presentation format as in our full-year results, which includes rental services within the lettings part of Core, which is where it sits operationally. But for this audience, it also splits it out as one of our strategic growth areas. So agency revenues increased by 7% to GBP 138.5 million. The increase was delivered through a mix of package upgrades, particularly to the top package, continued use of our digital products, and good outcomes from our annual price increase process, which is now largely complete. In the letting side of agency, revenue has increased by 12% year-on-year.
As Johan set out, the supply-demand imbalance has reduced somewhat, but it does still remain despite being down on peak levels. So as a result, we have seen an increase in membership and product spend within this letting segment, as well as good uptake of our Lead to Keys product, which provides enhanced lead qualification and efficiency benefits for lettings agents. New homes revenues have reflected the underlying market, with growth of 4% after a record performance in 2023. New homes growth was driven by ARPA growth of 9%, with developers continuing to favor our advanced top package and compelling products, particularly Native Search Adverts. The headwind, however, was a reduction in developments in the market and therefore on our site, and we'll come back to that shortly.
Revenue growth in our strategic growth areas has increased by 31% to GBP 8.7 million. Within that, commercial real estate revenues have increased by 11% to GBP 6.5 million. Growth was driven by increased membership numbers, now just under 1,000 and up 8% on the first half of 2023, with ARPA broadly flat at about 1,100 GBP. We have soft launched, as Johan said, a V1 of the landing page, and we expect a more significant upgrade to that during the second half. Mortgages revenue was up 176% year-on-year, with revenues of GBP 2.2 million for the first six months of 2024, ahead of the whole of last year.
As Johan mentioned, we generated more than double the number of Mortgage in Principle submissions than during the comparable period, and good broker lead volumes for our broker partner. We have also just recently launched a second agency-owned broker to the platform, and we've also started working on a remortgage product proposition, which will launch a little later. Rental services revenues are up 29%, with good early take-up from Lead to Keys, which launched in the second half of last year. Then other revenues, which include data services, overseas, and third-party advertising, grew by 2% in the first half, and we do expect a slight recovery in the second half. The chart on this slide breaks out the drivers of revenue growth between ARPA and membership for estate agency and new homes.
For the first time, we're also setting out the split between sales agents and lettings-only agents. Within resale and dual sales agents, good ARPA growth as a result of ongoing uptake of our products and packages, along with BAU contract discussions, as expected, has more than offset the slight headwind from a market decline in branch numbers. In lettings, you can see a different dynamic to the other two subsegments, as around 70% of growth in this sector came from net membership growth. ARPA contributes as well, but to a lesser extent, as our new lettings joiners do tend to be lower ARPA partners. And then within new homes, the drag from lower development numbers is clear on the chart, offsetting over half of the revenue growth from the ARPA uplift. Meanwhile, new homes ARPA growth has remained consistently strong.
Pausing on ARPA, overall, it has grown by 86% year on year to GBP 1,497. As ever, discretionary spend on product remains a more important feature than pricing, with 53% of ARPA growth due to that product spend. Agency added GBP 76 of ARPA, up 6% on the first half of 2023 to GBP 1,417, and we saw notable growth in vendor lead products, Local Valuation Alert, and Rightmove Discover, as partners continue to see them as crucial to winning new vendor instructions. These products delivered a further 8% increase in leads relative to the first half of 2023. Our contract renewal discussions have all proceeded as expected and are materially complete for the year, with no change to our long-standing pricing policy.
New Homes ARPA has grown by GBP 164 or 9% year-on-year, and we see this as a really good result in the context of a tough housing market and following two record years, where New Homes ARPA increased by GBP 450, which was 34% across 2022 and 2023.... We've seen successful contract renewals across all partner segment, with ongoing uptake of our top-tier advanced package, which now accounts for 56% of subscriptions. ARPA growth was also supported by increased spend on discretionary products, particularly display products such as Native Search Adverts, which grew by 5% in revenue terms versus the first half of last year.
Finally, the launch of the Access Package has helped us to welcome more developments onto the platform, with a 32% growth in housing associations on the site in the first half, but again, with a slight trade-off in ARPA. Total membership at the period end was just over 19,000 partners, 16,193 in agency, and 2,868 in new homes. As we set out in our May trading update, agency numbers have grown by 2% on December, and the chart on the bottom left highlights our really strong agency retention at 95%, with consistent joiner numbers and a significant reduction in the number of leavers. The chart bottom right examines this further, showing how materially membership growth has been supported by the letting segment.
We added more lettings partners in the first half of 2024 than in any previous first half in the past 10 years. We now have around 290 partners on Lead to Keys, of which around 90 are completely new to Rightmove, attracted by the efficiency gains from this software. Within New Homes, the chart on the top right focuses on our largest corporate partners to give a consistent view over time. The orange line shows that we continue to retain all of the large developers on the site, and you can see from the green bars how the number of developments has reduced every month since January, with development numbers at the end of June, the lowest they have been since December 2021.
We heard from Johan earlier how the large developers do have public unit completion targets, and the new government support for house building has been well flagged. So as a result, we are confident that as activity levels pick up again, Rightmove will remain the place to view virtually the whole of the U.K. property market in one place. Operating costs increased by 15%, GBP 7.1 million year-over-year, of which the majority was an increase in people costs. We increased our headcount by 12% from December, and by the end of the year, over 80% of our staff will be in either tech or partner-facing roles. Total operating costs were GBP 53.4 million, with an associated Adjusted Underlying Operating Margin of 72%.
This measure excludes the share-based payments as usual, and now also excludes the Coadjute charge of GBP 3.6 million, and this is the metric we will continue to use for the full-year 2024 and for the first half of 2025. As in every year, we expect the margin in the second half to be lower than in the first as a result of the full-year effect of payroll increases and our usual ramp-up in marketing activity leading up to Christmas. So as a result, we are reiterating guidance of a 70% adjusted underlying margin for the full-year. So looking at the income statement, without the Coadjute charge and without the share-based payments charge, adjusted underlying operating profit was GBP 138.7 million. A few points on the items below operating profit.
Share-based payments and finance income were both broadly in line with prior years, and our income tax reflects the U.K. corporate rate of 25%, but with some non-deductible capital items leading to an effective rate, very slightly higher than that. As in every period, we have continued to buy back shares. Our weighted average share count is now below 800 million, and full details of that are in the appendix. We remain highly cash generative, with GBP 143.8 million of cash generated in the half and an adjusted cash conversion ratio of 106% of operating profit, compared to 102% in the first half of 2023, largely driven by improved working capital metrics. A total of GBP 100 million was returned to shareholders, GBP 55 million via the buyback and GBP 45 million via the final 2023 dividend.
Cash tax was GBP 32.9 million, higher than in the first half of 2023, reflecting both increased profitability and the full impact of the U.K. corporate tax increase from 19% to 25%. And we ended the period with GBP 23 million of cash on the balance sheet. So our capital allocation policy and guidance for 2024 are unchanged. We will continue to prioritize investment in the business, including remaining open to inorganic investment to accelerate our strategic delivery. After investment for growth, we will continue to return all excess cash to shareholders via a progressive dividend and the buyback thereafter. We reiterate all guidance given in our May trading update. We continue to expect membership numbers to be up on the prior year by up to 2%. We reiterate the ARPA growth range of GBP 75-85....
Total revenue growth in the year of between 7% and 9%, all at an operating margin of 70%. Thanks, everyone. I'll now hand back to you, Johan.
Thank you, Alison. All right, so I'll continue with some of our operational and strategic main points. Now, this diagram I, I really hope is familiar, but it's worth repeating for two seconds. These are the high-level building blocks that we have on our powerful platform on both of the sides. They provide a very strong network effect, and combined with a strong and very salient brand, it's a real moat for Rightmove as a company. Now, we are decidedly accelerating product development on both the consumer and partner side of this network, and actually in many more subment, subsegments of it, which you can't see here. Finally, we are powered by our vision to give everyone the belief they can make their move. There is still more opportunity. So I'll give a few examples of how this works out.
If we start with focusing on the partner side of the network, as a reminder, on the left, we increase our throughput of product development and innovation ongoingly. Combining the largest data signal universe in the UK property market with consumer research and partner feedback, we can deliver tailored product, increasing segmentation, and we can indeed get them to substantial scale faster. In the middle of the slide, a reminder what it should lead to, and it does, and that is our platform really drives the outcomes that our professional partners most value to grow their businesses. So a few examples here. Three out of four agents say that we are the most effective at driving leads. We deliver five times the sales outcomes and eight times the lettings outcomes compared to our nearest competitor.
On the right, just want to point out that for well over a year now, since spring 2023, we've been working to pool together research, data, and feedback from agents to launch a refreshed partnering framework that we call Building Success Together. I'll come back to that a little bit later. Now, Rightmove remains by far the largest and most instinctive place that home hunters turn to and return to. So regardless of various, various comparison sources you can look at, and there are quite a few out there, Rightmove is displaying solidly over 80% share of time spent across portals on Comscore and Ipsos, and above 70% for Similarweb. Our own data, bottom left, shows a slight uplift in both visits and time compared to last year, and both of these metrics are significantly above their pre-pandemic levels, as a reminder.
Now, we focus on the quality of the traffic as well as the volume, and in that light, it's important to remember that over 85% of our traffic comes organically to us, with consumers actively seeking out the Rightmove brand. And as I mentioned before, our app users deliver well over 40% of our email leads. And for our partners, the leads that we deliver are 6% higher in the resale segment year on year, and in aggregate, almost 40% higher than pre-pandemic. So the accelerating rate of product and innovation here is just a graphic and some examples. So we're delivering over 130 features and enhancements just in the first six months of this year. We're doing it with now 24 product teams, compared to 16 this time last year.
All of our over 300 technologies at Rightmove are now coding with assistance from an AI copilot, and over 80% of our engineers have reported early on feeling more productive about it. Now, pausing on AI, just a little bit more broadly, we have around 10 applications or so at an advanced or deployed stage across all various parts of the business. Small example with a big impact is that with a vertical AI tool, we're now saving 500 person days' equivalent work for so-called DSARs or data subject access requests, which we are legally required to support. Now, overall, we see AI as a big enabler for the future, especially for someone with our data on scale.
We're building decent momentum with dedicated AI tech squads who are co-working with various teams out in the business, and there's a lot more coming in the pipeline here. Now, all of that existing activity and innovation has to happen as we maintain a very, very high quadruple nine site uptime and a best-in-class app score. So the main diagram here, it's fuzzy on purpose because it actually contains the real details of a ton of different products that we're working on. But each colored bar here is one of the 130 features in the, in the first half of the year, and more coming, of course. Just calling out a few examples.
Consumers, they now benefit from clearer access to EPC information, great pickup of that, list sharing, collaboration tools, material property information enhancements, enhanced filtering, moving journey assistant tools in My Rightmove, save and return on mortgage applications, and plenty more. Within Core, we rolled out enhanced multi-branch company reports, which really drives better agency network management and visibility. We're also enhancing partners' ability to self-serve on various tasks, like user management in Rightmove Plus, which actually just crossed 50% uptake, just from starting it last year. We've enabled self-serve amendments to the creative assets for campaigns that partners put on our site, and that's another area we are now experimenting with AI tooling. In the strategic growth areas, as I said, they're all delivering really well against our operational milestone, milestones.
For the enhanced former tenancy manager within Lead to Keys, we've seen a good pickup, and we also have now the first iteration of the commercial homepage. We continue the strategic model push, digitizing more of this industry. There is absolutely more to do. We're delivering effective and truly useful tools, not gimmicks, for our partners and for ourselves. The cloud migration and unified data platform also continue to progress. They really are non-trivial undertakings, but they will provide a super strong foundation once we get through them for many more years of even faster innovation than today. Within the consumer domain, I'll just give you an example of what we would call connected innovation. We think about this logically.
We are building increasingly beyond the Find segment, sometimes within the Find segment, but also beyond it at the same time, and we try to really reinforce consumer utility and consumer frequency with our property platform. So within the domain of affordability, if you remember, this is the second step in our strategic model below Find, we launched TAP, or Track a Property, last year, and we're already seeing roughly 80,000 new tracks being done every single month, thanks to our large reach. So a user will get an online valuation estimation range on an owned or other properties of interest, out of all the properties that we have historic valuations on. The user can then opt to get valuation updates regularly from us.
So we see a super high 80% email engagement for trackers, and 9% of the tracked properties are soon coming to market on Rightmove, which again is another indication from a vendor perspective. So we get enriched data signals from the serious home hunting audiences, particularly, and that contains value to our agent partners beyond a raw lead click. You can see in the middle of this slide how Rightmove now also credentializes agents as the local and ultimate experts in valuation. And then logically, we're trying to think, "Okay, what's the next building block here?" So we innovate on the back of TAP, and Renovation Calculator is a good example. It's an upcoming consumer product launching in the second half, potentially already in Q3. And we use a ton of our own data and external planning data to create this.
Now, the stat is that 20% of owner-occupiers out there, they carry out a meaningful extension of their home at some point, and for them, it's extremely important to feel assured that that gets reflected in property valuation. So it's a good example of how we segment more granularly. We build products for those segments. And naturally, this particular tool can be used for someone considering to sell down the road, get a better valuation for it, but equally, someone who's looking to buy and then want to upgrade, which is often the case. And the third element of this connected innovation module, or way of looking at it, within the affordability domain, is how both TAP and the renovation calculator really gets reinforced by the expanding suite of mortgage products.
So today, Mortgage in Principle is mostly for purchase, which is obviously connected to, for example, valuation interest. But in the future, we'll also start building out and offer remortgages and loan extensions for green and retrofit purposes. So again, three building blocks that will really drive and, and actually enforce each other over time. So we drive functionality, utility, frequency. We are building a larger digital ecosystem connected to the platform, and we are becoming increasingly really a consumer-moving assistant when it comes to home transactions. That opens up more value for agent partners, and of course, it also increases monetization opportunities as far as as a company. So next, a number of you have asked about our approach to consumer marketing, and I'm sure we'll get back to the topic of marketing. So just a few thoughts and to outline how we think about this.
We approach the consumer of today with a big advantage, which is important. Rightmove is a much-loved brand. It's been reinforced through almost 25 years of investment and credentials, and of course, all the data and product-driven platform benefits we operate. So we have a comprehensive marketing platform. We call it Believe It, and it builds on those advantages. It evolves them logically and very much in sync with how we grow our product features in the business overall. There are four key pillars. From left, we continue to build a brand leadership. It's deep, it's salient. We play international set pieces like the Euros, Paralympics on TV, et cetera.
We recently actually used our brand leadership during the election to call for a change in approach to housing in the U.K., and it culminated in an exclusive interview, answers from both Sunak and Starmer on their respective housing policies. Societal leaders respond to leadership brands, and we have one. In two and three, we then credentialize and expand our utility to homeowners at both personal and national aggregate levels. Our scale enables us to segment the consumer base with increasing efficiency, allowing us to personalize both products and communications, an example of which I showed on the previous slide. We combine this really with industry expertise and so much historic and ongoing real-time streaming data. Through news, regular reports, and moving stories, in the first half, we were seen over 4 million times out in the press.
Finally, in four, we are indeed thinking about the future, building for the next 25 years, engaging the next generation through a raft of activities, showing up where they digitally live on channels like YouTube, Pinterest, TikTok. And on TikTok, we're actually one of the fastest-growing brands overall in the U.K. Now, just touching on one of our strategic growth areas, we have seen that 29% of our rental services operation, which is now built out with the Lead to Keys suite. And as a reminder, why do we do this? Because it's a little bit of a different product than we've had in the past. Well, rentals, as mentioned, is over half of the moving events in the U.K. market. More and more people actually rent due to affordability or choice. Probably about, there are 2x more renters in the U.K. market compared to 15, 20 years ago.
So our advertising revenue in lettings, on the listing side, really had stalled, and we're now bringing new and promising solutions against that opportunity to be able to grow it into the future. Lead to Keys is the U.K.'s only digital end-to-end connected solution, starting at the very top of the consumer funnel, leveraging an asset that we have, very important, and that's, of course, a core strength. We monetize all aspects of this. Lead to Keys partners on the lettings subscriptions for access to the platform, paying an additional subscription for Lead to Keys, including a set level of free references, and then they can pay for variable references on top of that. More revenues as a broker, us being a broker here, for Rent Guarantee Insurance, Tenant Insurance, tenant utilities such as broadband and media, and we continue to actually develop.
Right now, we're experimenting with a couple of more, consumer ancillary services. There is a substantial total revenue pool of hundreds of millions GBP as we look at this entire category, and that's illustrated in the bottom right graph. But also, we are very, very early stage in terms of this opportunity, but, it will be an exciting journey, and we're trying to build it to its full potential over years to come. Bottom left, you can see early, but clear evidence of beneficial outcomes for our partners. Really, really strong scaling and uptake from a year-to-year perspective across several very important metrics. The top chart, right, just shows how Lead to Keys revenues have grown on a monthly basis since we launched, not that long ago.
I think what's notable here is that we're bringing in new lettings partners to the Rightmove platform, that were not there before, as well as seeing a good uptake among our existing base of letting partners. Speaking of partners and another piece of marketing, also important to remember the position that we have out there, the Building Success Together program. So for long, we've offered all of our partners significant resources, consultation, expertise, et cetera, as part of the Rightmove subscription. In 2023 alone, we ran 64,000 business partner meetings. We participated and shared insights in 30 or so national conferences, and we had over 44,000 people registered on the online training hub. Now, there's a spectrum of free tools and data insights on Rightmove Plus and also within that Rightmove Hub.
Now, most of our partners, specifically the vast majority, which are SMEs, they are still very, very busy. So the sheer scale sometimes of our support, data, different toolings, et cetera, it can be overwhelming. So we started thinking about this and really consulting with partners already in the spring of 2023. This is not a recent construct, on how we could actually improve how we deliver business value to them. So the result is this program, which we launched in Q2 this year. It contains these four pillars of insight, training, control, and advocacy. And it's a little bit like I described with our consumer marketing. It's a comprehensive, strategic, well-researched program. Of course, we'll continue to evolve it. We don't throw stupendous data points as a selling act. We throw serious effort into bettering our services with partners.
Much of it is continuing to optimize what we've done before, but now we're taking it to the next level with this program. In conclusion, I want to say two things here. If we can roll forward. Coming. Okay. There we go. Are we on? Yep. Nope. You need to move on a little bit further. Otherwise, I'm going to have to look at slides. There we go. So just some reflections of our business at a higher level. Sorry. Yeah, now it's gone lopsided. Well, there we go. I think it is a summary. You've heard it all before, but I think it's hopefully also been clear in this presentation and through the results, we have an optimistic outlook on our business.
We're aware, though, that the market, as of now, needs further pickup, and it will, at any point in time, you know, always have its certain set of dynamics and again, different speeds in different parts of the market. Now, we're convinced that there's a clear line of sight opportunity for further digital transformation. We are starting that from a fantastic and resilient platform. So I also want to extend a thank you to the hardworking Rightmovers team delivering against this opportunity. And finally, the overall case. We operate in an attractive, large liquid market, U.K. property. We've successfully built a central position for over 25 years. We have a uniquely powerful brand with 96% awareness among home movers. It's an incredibly powerful position. We're convinced that we can strengthen our already powerful network effects.
We're data-driven, and the B2B model, obviously, at the core, enables us to drive the business forward in all market conditions, basically. We actually do think, even with the 24 years in the back, that we're just in the beginning of a new journey that we set out 8 months ago, and we're attacking that through our strategic model that we have outlined previously. We are not complacent. We're restless to innovate. We are scaling the core business. We are building new adjacencies. We are connecting them logically to the platform, and our aim is to deliver double-digit growth over the medium term. So thank you for listening, and with that, we'll go over to questions. And Ben will help to emcee that.
Great. Should we start with Joe and move across?
Excellent. Thank you very much. It's Joe Barnet-Lamb from UBS. three from me. So firstly, just with regards to the evolution of competition, I think I'm right in saying that your share of time spent, year to date is about the same as last year. Your retention of agents is what seemed to be the highest, that you've had for a long time, and in underlying terms, I think your agency ARPA growth, excluding lettings and in pound terms, is about the highest it's been as well. Is all of that correct? And, is there anything you did or saw that was different in H1 as a result of competition? So that's question one. Question two, it feels a little bit like you're sort of caught between cycles.
We're starting to see the property market warm up, but not enough that we see new agent formation or new home developers breaking ground on new developments. Is there anything more that needs to happen for those things to happen, or is it literally just a matter of time? And then thirdly, at the CMD, I think you guided to GBP 120-130 of ARPA in 2025 and 2026. Now, obviously, the shape of the business has changed a little bit with the push into lettings that you've had thus far this year. Does that guidance still hold? Is there anything you can say about that guidance? That would be helpful. Thank you.
Yeah, I'll start with the first two. Yes, I can confirm what you said. You know, positions generally remain very intact across all different metrics, and we try to lay them out. Actually, what we did here, we did on purpose, we laid out three different sources of information, as I mentioned, right? And the one that we've used in the past, and still, Comscore shows exactly the positions being in a super intact position, and that's an important aspect. It is not the only aspect, but we know it takes interest. You know, generally, so we're happy about that. We continue to be very focused on executing our plans with an eye towards obviously, always near term, but certainly also long term.
You know, from a competitive perspective, I really don't think there's that much additional new news or commentary. You know, it's sort of in the public, what they're stating about the UK and what kind of activities they're undertaking, and we continue to plow along with our business and accelerate it at the same time. Secondly, the cycle point. Yes, I think that's a good way of phrasing it, Joe, caught between cycles a little bit or you know, being in somewhat of a transitionary period, right?
So, the catch-up effect on the resale side with listings, volumes, pent-up demand, et cetera, positive sentiment and statements on agent pipelines has absolutely, you know, built pretty solidly throughout the year, again, with a delay until cash flow comes in. While on new homes, that's again, slower for longer, right? It's there are bigger tankers to turn around. There's a little bit more uncertainty in terms of how that sort of whole cost versus sales and therefore benefits, you know, come around for them. But again, generally, you can read that, you know, they definitely start calling out the development numbers to go up, but in a cautious way, right? ASPs are pretty firm. Sales ratios are firm to even starting to go up a little bit.
Discount levels, they're also quite firm on, and they're clearly now not just relying, right, but really hoping and working with the government to make sure something happens out of the ambition statements. But it does take time, right? So this is not all of a sudden, it's going to explode in the second half of 2024. Absolutely not the case, but cause for optimism. I think the pain largely, or to a larger extent, is in the sort of mid and tail end of the developers. And again, some of that is reflected in these numbers as well, right? Same thing there. It's not easy to pin down exactly when all the optimism will come back, but it will at some point.
I'd just add two, two data points on competition as well. I mean, we've particularly zoomed in on consumer engagement and agent retention. But also, if you look at the strength of upgrades to Optimizer Edge and our ability in this first half to have put through our normal pattern of price increases, those two also really go to emphasize the value that agents see in the products and in the subscription, and there has been absolutely no change to behavior there. If anything, we're ahead on the Optimizer Edge curve, and we can certainly talk a bit more about that. On the CMD mix guidance and revenue guidance, clearly, this mix shift in the first half of this year has changed the route to the revenue numbers.
So we absolutely stand behind the revenue numbers that we set out at the CMD, but the way that we'll get to them, as things stand right now, is with higher customer numbers on the agency side and slightly lower ARPA, ultimately leading to the same revenue numbers. I think that the levers always for revenue drivers are customer numbers and ARPA. The volume of lettings ads, you know, has diluted ARPA. If we were to see a mix shift back towards the more traditional mix, you would see a pickup in ARPA, and therefore, I think all roads will lead to the same revenue number.
That's perfect. Thank you. Just one follow-up, if I can. With regards to the Coming Soon tag for New Homes, what's the lead time between that and seeing the New Homes developers sign up the developments in full?
It's a good question. I actually don't know a precise, precise answer, so I don't know if you have that, Ben, or-
Yeah.
someone in the team, otherwise, we'll follow up, but...
Thank you.
Andrew.
It's Andrew here from Barclays. Sorry, I've taken the mic. I've got three as well, if that's okay. The first one, just to clarify the ARPA guidance for this year, 75-85, it was a bit higher than that in the first half. What, what are the drivers of it slowing in the second half, or is it just you being a bit conservative? That's the first one. The second one is just to follow up on Joe's question on the, on the 2025 guidance. So fully understand the mix dynamics, but just to be clear, you are still guiding to slightly accelerating revenue growth compared to the 2024 range and a 70% margin on a clean basis, to be clear. And then the third question is on the supply side of the market coming back to competition.
Obviously, CoStar gave some numbers this week in terms of where they feel On The Market is in terms of branch numbers. Is that kind of consistent with your tracking? And where do you think On TheM rket is relative to Zoopla? What do you think is happening on the supply side of the market? Thanks.
Got it. I can start with three, Alison, and we can pick up on the others. So, I think as with some other numbers that are not coming from a third party or independent source, it's hard to comment on it, and therefore, I won't specifically. The activity, of course, that they're undertaking is trying to build a supply, but what we focus on is very high principles around the methodology, obviously being quite granular and having a lot of history, specifically in this market, and those are numbers that we report. I think the further question on the two other brands, again, not really for us to comment specifically on those two.
You'll see commentary out in the news, and I think that's readable for everybody and also up for interpretation, I would say.
So on the first question on ARPA, it's the reduction in the second half is largely just year-on-year comps on the new home side, in particular, where growth in 2023 was so strong and continued into the second half of 2023. So it is just simply that movement from one year to the next. In terms of the mix dynamics and 2025, so we're not giving out specific 2025 guidance today. But having said that, everything that I just said about the mix and how we get to the CMD revenue numbers and those revenue projections, we continue to stand behind. So I would point to the fact that this year we put through the same level of agency price increases as we typically do. That has all gone very well.
The strength of Optimizer Edge upgrades, combined with the withdrawal of the Optimizer 2020 package, those will all continue to drive acceleration in agency ARPA, particularly among the resale and dual agents, into 2025. And then, on the lettings ARPA side, despite the fact that their advertising subscription ARPA is lower than the resale agents, they are absolutely our pipeline customers for Lead to Keys, and we will continue to drive adoption of Lead to Keys into that base. So all pointing to good ARPA growth into next year.
So just to follow up on that, the medium-term ambition of getting the group into double-digit growth has clearly not changed?
No.
But you're not being specific in terms of whether we're thinking 25 is going to slow, show a slight acceleration or not in terms of that trajectory to the medium term?
Not today. We're not setting our 2025 guidance today. We will do later in the year, but there's still six months of the year left to play out and, you know, movement in the underlying market. So you'll hear from us later in the year with regard to specifics for, for next year. But everything I just said about standing behind the CMD growth numbers remains.
Okay, thanks.
Okay. Should we go to the back and then working over?
Hello, hi, Rahul from HSBC. I have two questions. In terms of investments in product growth, I think last time you said you're investing in 200 headcount, three-fourths in product growth. So just wanted to understand, where we are in that investment process. And in terms of margin, obviously, I mean, can you just give us basically a step up in R&D, sorry, step up in capitalized expense, in the cash flow? So I just want to understand, how you're accounting for in terms of incremental product R&D, it is expense or capitalized, and basically, what's your thought process there? First one. Secondly, in terms of, again, coming back to Optimizer Edge, could you just give a sense of where we are in terms of product spending?
Are you seeing basically with increasing higher discounts from the third number three portal in the U.K.? Are you seeing some more product incremental spend at Rightmove now at this stage, or probably just want to understand the dynamics there. Thank you.
Sure.
Got it.
So on headcount, I mean, we're completely on track with where we expected and wanted to be. We added about 100 heads in the first half. We'll probably do the same in the second half. As always, with us, costs tend to be weighted towards the second half of the year, which is why you will see that slight dip in margin from 72%- 70% for the full-year. Yes, you're right, Rahul, we have slightly increased the capitalization of headcount as we invest in behind the strategic growth areas. It's not particularly material. We're going from 2023, where we capitalized costs in relation to our new ERP system, and we capitalized the product development team for mortgages. We are now-- So that was a total of about GBP 2 million.
That too, has now become 8 for the full-year, and you've seen about 4.5 of that in the first half.
And on the last point around Optimizer Edge, so, we obviously launched this last year. That's also when we started talking about it. We've given some updates on where we're tracking on it, and we're giving the normal sort of initial 12-month period getting to roughly 1,000. Now, given the numbers that we're at, we're obviously seeing very good pace with this package on the back of what it contains, interest and benefits to customers. So we're quite pleased with that acceleration. Not at least in a market that is, yes, recovering, but still has some ways to go, and so forth. And of course, at least theoretically or potentially, a new competitor dynamic.
But importantly, that has not made any changes to the success, actually more than the historical success in terms of rolling out the top-end package and the usual contract renewal phasing that phases that we do throughout the year that Alison mentioned before. So we're quite pleased with that, and obviously, the work on product generally continues, right? We're still. We see an over 50% spend on product versus, you know, core listings, right? As we said before, that balance tilts a little bit from time to time, but that's where we are. So good product uptake overall.
In terms of, I think you last time you got it to slightly greater than 1,200 uptake for Edge. Are we still on track, or probably you think that you could exceed that guidance, or just in terms of that number of 1,200 uptakes?
Yeah. So what we said when we launched the package was that our target was to have 1,200 agents on it by the end of 2024. At the end of June, we already had 1,400 agents subscribing to it. And as I said, we will aim to withdraw the Optimizer 2020 product, so ultimately, over time, our target will be to have, you know, 3,500-4,000 agents on that top pack.
Okay, Jess?
Thank you. Jessica Pok from Peel Hunt. I've just got three, please. When you set out your kind of outlook, financial outlook during the Capital Markets Day, had you anticipated kind of some of the efficiencies that you're getting from AI? I guess where I'm getting at is, you know, looking at your need for developers and personnel and into the next couple of years, do we have potential upside because you're getting more efficiency out of your people? The second question is that, we're seeing a lot of consolidation, you know, in the agency market, and do you expect any impact from that? And more so on kind of pricing and various things.
And then the final question is just on the letting partners, which have come on to Lead to Keys and just onto the platform. You know, I'm assuming your penetration rate is very, pretty high. So, I mean, do you expect a, a good number of... Is there more of these letting partners which can come onto the platform, in the near term?
Thanks, Jess.
Yep, I can start.
Okay. AI?
Yeah, with AI, yes. So the short answer is no, we have not made any precise estimates of the benefits of AI, nor in the business opportunity to consumers, or to partners, nor from an internal, you know, speed of delivery or efficiency. There's always an ongoing productivity measurement and, of course, improvements. AI does hold quite a lot of promise within that. We're exploring that, and that's how we're thinking about it now. We're business casing it out, but it's too soon to say or communicate any specific sort of impact of it, right? Remember, lots of interest in it, we're on it right now, but it's still in its early, sort of, infancy in terms of full potential.
Second one on consolidation. Consolidation obviously can have an impact of some rate alignment across our partner base. And that's a difference in a way, or it might be worth commenting slightly differently on agency versus new homes, right? An agency, it's always been going on to some extent. It will continue to go on to some extent, right? And in some ways, it's another reason for us to continue to segment further our products, cater to very large, medium, and small indie agents as well, which is exactly what we're doing.
On the new home side, just because that might become a question specifically anyway, I think there are about three processes ongoing right now, two of them expecting some kind of answer here early August, right? And the general piece there, again, there might be some alignments between contracts can go going in different directions. But I think what's important to remember is that, first of all, as you said, there's weakness in the long tail of developers. And between the developer stopping to build altogether or even go out of business, it's much better to see them become part of something else. Somehow their business will continue, right?
And among some of these larger potential M&As, the positive, one of the positive outcomes of it will be that obviously they're gonna, generally speaking, be stronger, have a bigger balance sheet. When they actually look at a site, they now say, "Hey, we have one or two brands already on this site. Now we can complement that with one or even two other brands on that same site." That provides real scale in terms of the production of that development. We have them as partners per brand and development, right? So if that makes them a stronger business and therefore release more developments and build more, you know, fantastic, you know, for our business. So, I think that's one aspect to actually keep in mind.
And then on the lettings question, Jess, so we have just under 2,800 lettings-only branches on the site right now, of which less than 300 are Lead to Keys partners as things stand. And you've seen in the CMD materials, the way that we intend to grow the volume of Lead to Keys take up. I think it's also really gratifying to see lettings-only agents come to the advertising side of the site, just in order to access the Lead to Keys software. I think previously, you know, we would not have had those lettings agents as customers. So of course, we welcome them, and we will probably see more of that. But within the existing lettings-only base, clearly there's lots of opportunity to go after there with Lead to Keys as well.
but I guess I was referring more to the fact that the lettings agents, which have come to the advertising side-
Are there more of the, you know, a lot more of these lettings-only agents, which aren't on Rightmove, which can come on? Assume, because your penetration is already quite high in the market already.
Yeah. Well, there are a couple of things. So there are small lettings agents who historically have not been on Rightmove or indeed been on any of the portals. They have, you know, low stock, and they're quite happy to just advertise in their local area. So we will, and are, seeing some of those come onto the site now. And then the other thing that's going on is a slight shift in the demand and supply imbalance, and that was really what was the blockage when the only product that we had to offer was the advertising product. Those agents, you know, if they're getting 30-35 leads per available rental property, it's a cost to them to have people managing those leads.
They didn't need more leads from any portal, and so they didn't advertise with the portals. That demand and supply imbalance is now reducing somewhat, as I said. It's still there, but it's quite dramatically less than it had been. So there is more of a need for leads and, of course, for lead qualification, which is exactly what Lead to Keys is.
Great. Do you want to go forward to Gareth and then?
Morning, Gareth Davies, Deutsche Numis. Two on the strategic initiatives. So on commercial, you said you've sort of, it sounds like you've sorted the front end now in terms of standalone commercial. Is that an important catalyst in terms of getting the sales team out more aggressively looking to win new customers? And how much kind of product is still to be built to get to where you want to be, to sort of have that properly saleable product? And relating to that, are you seeing any difference in terms of what the competition is doing in that market? And then really similar question on mortgages, really.
Just can you give us a little more color on sort of the investment and the product that you've got there now, and, and sort of how far through that journey we are before you get to that end product that you can get out properly into the market with?
Yeah. I'll start. So on commercial, it's great, and we call it a V one. There's actually a new landing page being built as we speak and launched. It is not a massive catalyst for sales doing something different. We have a sales team operating, they're running the business. But of course, they're a tad more proud being able to talk about the landing page that we have today. And it's not just a landing page. Yes, there's some visuals around it, but it obviously has some better division, segmentation, and logic behind it. So it's good that we have it. It's a necessary piece to be fully serious, let's say, and show that we stand behind our investment in this area and help partners.
But, you know, sales work continues as before. And then, you know, there's more work underneath going on in terms of data feeds, the data that we can take in, how we obviously then do display that back up on the site, catering as usual to, okay, what are the specific needs of commercial real estate partners in the quite different segments in that industry, right? Which we literally didn't do anything of before. And that's a little bit more of the sophisticated, you know, build that happens underneath, right?
All of those pieces combined, and as we release them, will obviously put the product in a much better space, and from that we will grow volumes, and we can penetrate the segments deeper, and of course, look at also our own spectrum of products and different pricing components and packages, which is quite basic today. So therein lies the opportunity. But as we said, 2024, 2025, basically to be seen as investment years from that perspective, while we continue to track along with sales out in the market. And on mortgages, yes, I mean, look, we're. It's a small base, but we're phenomenally happy with the pace of that right now.
We, I think, mentioned here that we've just added a second broker agent to the mix, continue to work with our main lending partner. And there's simply two things happening from our perspective. We are constantly, but in a very logical way, adding exposure to our users where we think it makes sense. But there's a lot of interest in this area, in spite of, or maybe even, you know, helped by the external environment, doesn't matter. So that's one thing that is going on, just to drive exposure, awareness, and users, you know, love the fact that we have this product, right?
Remember, the MIP itself is obviously not tied to collateral, so it's a great way to get an indication of where am I, or where am I and my spouse. It's now with the volume starting to build very interesting information also from us, not just the direct commercial opportunity from these leads for us, but the enriched data signal again, right? Someone who has an approval for a GBP 400,000 mortgage, for example, that's a more interesting lead, more qualified lead, for one of our partners than someone simply clicking on the website, right? So with that volume comes more opportunity, obviously. And then generally speaking, the other part of it is just optimization of the product itself, how we gather data.
We run quite a lot of ML, ML and now, you know, starting to do Gen AI as well, on this, connected up to our different marketing programs, and so forth. One example, and it was mentioned here, of just one of those optimizations, but this is how we build online consumer products, is the save and return function. So while we have made this, the form filling quite more efficient than many other sources, or places you do it, it's still quite a lengthy process. And particularly if you're a joint applicant, there's a number of complementary information, that you need to do. And before, that was a little bit like, "Ugh, I don't have this now. I can't get a hold of the information," people drop out.
Now we basically put some additional security around this and functionality so that people can partially do this and then come back. So it becomes almost a self-nurtured way of completing the form. And the more completions, the more chances, obviously, at the certificates and actual lending happening down the road. So again, just an example, right? But that work continues. And it's along those lines that we continue to do the job. And specifically, we're also now looking at the remortgage product, right? And how we try to connect that back up to some of the other things that we do at Rightmove. That obviously opens up a new, pretty meaningful category of TAM, but it's quite different than purchase mortgage as well. So early days.
Great. W-
Hi, it's Will Packer from BNP Paribas, and three questions from me, please. Firstly, the traffic statistics are impressive, but is it fair to characterize the current situation as the phony war, where your new competitor hasn't really started to spend at scale? Is that fair? And so, you know, we've got a bit of time to wait for that to come through. Secondly, could you help us think through how the cyclical recovery in the U.K. property market will impact your estate agency business? Is the right way to think of it that on a bit of a lag, we get a bit more agent formation and a bit more product uptake, and it's more of a 2025 story. And then finally, you're a bit further along with mortgages now, and you sound pretty excited.
There's a big graveyard in classifieds, land and mortgages in Australia, Europe, the U.S., where things have gone less well. What do you think is different? Is it the technology is a bit better, the U.K. market structure, execution? Just help us frame it for you why you're excited in the context of some of those challenges elsewhere. Thank you.
Okay. I can take the first one, maybe go to the second. So yes, it is great, given all the calamity and noise and some of the walking in the orchard of data cherry-picking, as I call it, out there during the spring. But we simply don't know exactly what you know plans are in the future. We assume that more marketing will be done and different types of marketing, including you know brand advertising. And that's a premise under which we operate. And as we said before, we obviously monitor a lot of metrics. We now monitor some additional metrics because of that. And we have our marketing plan. It's very strategic, it's very connected to what we do.
We are thinking in ways of, okay, there might be dynamics from time to time, specific ways of doing it, specific messages to be out with, and spend levels, right? That might change around a little bit in the future. But, we're very glad to see that our position stands very strong, in spite of quite some spend actually to date, all but in purely digital format.
On the cyclical recovery piece, Will, we haven't seen much new agent formation in the first half. You know, if you think about the drivers of it, transaction numbers is obviously a very big part of that. I mean, really, when we say it's been a tentative recovery in the first half, we do mean it. And that combines with the seven months from listing to transaction close, which is a long time for a new agent to have to market themselves and try to win mandates with no revenue coming in. So that would discourage formation. I mean, you would expect to see a bit more if transaction numbers pick up, but they have not picked up sufficiently for us to see anything meaningful there really at all.
Right. And on mortgages, I don't know, graveyard might be a harsh word, Will, but you're obviously, you know, deeply aware and knowledgeable about many situations around the world. But as we said before, for sure, our approach seems to be a little bit different to some of the others in that we are going with a pretty strong principle about only digital right now focused on actually building awareness for this product within the Rightmove context, but sticking to a digital model. And I think in many other cases, it's been the case of acquiring a mortgage broker or start working with them, which operates at a very different economics. And I can't really comment on you know, whether that's, you know, good, bad, somewhere in between.
Obviously, there's digitization, progress in those as well, right? But we've taken, you know, this principle, and we believe in that one, and that's the one that we nurture. We're also, you know, not saying that this business will all of a sudden become half of Rightmove, right? We think it's a phenomenal monetization opportunity that shouldn't be untouched by us. It's a very, very good complement to quite a few other things that we do, and it is a more direct or different monetization opportunity, right, than the rest of the business. Those are the components that I like.
And I think, again, the optionality over some years, in terms of exactly how we monetize this, between the different partners on the platform, can look different as we penetrate it. I think, you know, new technologies like GenAI will impact this industry. It's one of lots of information gathering, lots of process steps, and manual intervention, right? So that's another angle that we might keep in mind, given who we are, purely focused on technology.
Thanks.
Yeah. Giles?
Thank you. It's Giles Thorne from Jefferies. The first question's back on Lead to Keys. I wanted to get a bit of color about what happened basically between March and the tenth of May, because Lead to Keys is a product, first phase rollout was over a year ago. You obviously had all the learnings from that, that fed into your capital markets day, into your 2024, 2028 guidance. Then we get to the tenth of May, and suddenly there's been, I don't know, accelerated uptake in customers. So did something happen on the commercial front in those two months? A bit of color there. Secondly, back on mortgages, from 35,000 feet down into the very specifics, if I remember correctly, the traffic for the agent broker panel was being directed only after a failed MIP.
I'd be interested to see how that's evolved and what feedback you've had from your agent partners. And then lastly, two bits of M&A, after a bit of a drought, some comments on what's in your M&A pipeline right now.
Sorry, uh-
Do you want to take Lead to Keys?
Yeah, do that.
While you're doing that, I'll do the M&A.
Yep, great. Or sorry, if you want to start with M&A, please go ahead.
Well, one small acquisition and one even smaller investment. So, HomeViews, I think you know what it is, agent reviews, GBP 8 million. I mean, it was a very good complement to our rental operators offering. And, you know, we have now focused on integrating that and integrating that business, and we'll continue to grow it from there. Coadjute was slightly different. It was us taking a stake alongside three of the biggest mortgage lenders into a business whose technology is aimed at helping to digitize the sales process. You know, we back it.
We think that of the operators in that space, they have the best technology, but it is very, very early days, and the sales journey is so fragmented with so many different parties involved between local authorities, banks, conveyancing lawyers, the land registry, agents, buyers and sellers, that this will take quite a bit of time. So it's, you know, this is a long-term investment for us and obviously a very small stake, which we have now written down. You know, we said, we said in the presentation, we will look at investments that could help us to go faster on something we're already doing or to bring capability into the business that we don't have, but that does point to a small and bolt-on. And there's, there's nothing, you know, that we're, that we are.
When you say a pipeline, it's that there's a lot of air in that pipe. ... and obviously all of the plans that we have set out are based on organic growth. They don't rely on M&A.
Okay, so Lead to Keys. So the product, which is Lead to Keys, which is really a suite of different steps, had been worked on for quite a while. And we got it readied during mid-last year. We had it out as usual, in a pathfinding mode with real partners or potential partners, including, you know, very important feedback that we perhaps needed to adjust before we go into official launch. Obviously, also figuring out, you know, pricing and packaging model of it. As you know, it's actually a subscription model under which an agent gets X number of free references per month, et cetera, et cetera. The official launch really started only in Q4, not even in the very beginning of Q4 last year.
So, the pickup has simply... and I actually think the graph actually shows a fairly steady curve, given the still relatively small scale. There, you know, the bars might look a little bit different in height, but there's nothing, you know, particular in the more recent period. And remember, it's still at small levels, but it's quite exciting, right? Gets very, very positive feedback from agents. And as much of that great feedback and efficiency it provides, and we also showed you some of these stats in terms of year-over-year comparisons on, for example, inquirers. It is still not, you know, it's not like, well, like the best thing since sliced bread.
Meaning, it probably is, but it's still a process of reaching out, explaining this, you know, getting people to try. As we said before, agents might sit with a point or a part of the value chain solution with something else, right? But the exciting thing here is we're connecting it back up to, again, Building Success Together, obviously trade marketing, addressing both our own base as well as new lettings partners. So it's gonna—it's now on a continuous rollout track, and we're quite happy about that. Second one on mortgages. So yes, just to confirm that the current broker setup is on the decline of the main MIP with the main lender partner.
The feedback from our first partner and more recently, the second one, has been very strong. It's very collaborative. It's a new way for them to get leads. It's quite rich in information, which is very positive, but that's also where it needs to get connected to, you know, their process. I mean, these partners are generally speaking, tech savvy amongst agent brokers, and that's a reason for the partnership, right? So we're learning, and the volumes are building, and that's quite exciting. Exactly, as I said again, how the setup between, you know, lead generation and various ways of advertising against that opportunity, that might evolve in the future, but this is what we have right now.
Just to follow up, do you have any visibility into conversion for Nationwide of a MIP lead?
We do, but that's part of our commercial relationship-
Can you tell us?
with them, so we're not talking about that.
Pete, behind you. Yeah.
Hey, it's Pete from Morgan Stanley. Three questions. First one on 3D-modeled listings and what is the consumer appeal in the U.K., and whether, like, if there is, what would be the cost to produce these types of listings? You probably know where the question is coming from, so cost or acquisition of Matterport. Secondly, you showed this graph on inquiries per rental listing. So whether you want to talk about rentals or for sale, but on an inquiry per listing basis, how do you compare against Zoopla and OnTheMarket? And then lastly, about your product packages, actually both for agents and new homes. So what do you see as the optimal balance? Because right now you're approaching quite high penetration levels on the top package, which kind of then makes it like a hygiene factor.
Would it make sense to, at some point, have a top package that is actually priced in a way that it's not gonna penetrate 60% of agents? Thanks.
Okay. I'll start with one.
... for sure. So, on the 3D listings or virtual tours, and the known still pending acquisition in the UK, there are virtual tours on less than a single-digit % of all listings. It's been very stable for a long time. It typically gets to be on more premium valued properties, because it does cost significantly more to set it up like that. It is not showing radically different sort of interest or traffic metrics in other ways, right? It's absolutely a useful tool to some extent, but let's remember that those are the penetration levels. There are also quite a few other providers of that technology and ways to do it. Some agents even have some of that capability in-house.
The absolutely most important thing is really good detailed information, generally speaking, and photos. Right, so across those three. Now, could this evolve over time? Yes, but I think the promise of virtual tours or video showing has been around for a long time. I might have mentioned this before. I spent 15 years in online travel. We debated this a lot, we tested it a lot, we invested quite a bit in it. And somehow, photos in these kind of, you know, classifieds or comparison or property seems to be quite prevalent. But it's one of those, again, where, you know, we're testing, we're pathfinding with partners, and we'll see where that goes in the future, right? But there's nothing particular to report on it.
And by the way, it's a very similar story across most of Europe. We talked to all of our peers, let's say a little bit specifically on this topic, given the acquisition that was announced. And everyone is seeing quite a similar situation. You wanna take the second one?
Sure. I mean, we put the chart in mostly to emphasize the continuity of those outcomes for agents and for landlords relative to our competitors. And I think the point is really that the stats have not particularly moved, if anything, and particularly in terms of vendor mandates won on our platform. Here we're talking about 9x-10x the number of vendor mandates won for agents from Rightmove relative to, in this case, Zoopla, but also to OnTheMarket. You know, we start with the 86% or so of engagement. And we know there is lots of, you know, browsing and just property surfing at that level.
But the reason it's important is, of course, it funnels down into the really high quality, high propensity to move, buyers, sellers, and renters. And that is where really the quality of the leads from Rightmove, you know, shows up relative to the other platforms. So outcomes are the thing to focus on. The primary input into those outcomes is the quality of the leads. But, you know, we're talking high single digits, multiples, whether that's vendor mandates won, lender mandates won, and sales and lettings outcomes. And, you know, we will really continue to push that message because that is where our very big consumer advantage leads our customers.
And then on the third point, on the distribution of packages, yeah, you know, we're at a bit of a funny distribution curve at the moment. We have... If you take the combined Optimizer packages, so Edge 20 and 15, we're about 35% of agents are on that top level. And meanwhile, of course, down at the lower end, at the Essential and Essential Extra, there's about 47%-48% of agents are down at the bottom. And so the middle package, the enhanced level, is being squeezed. Having the idea - I mean, the ideal distribution is you'd have a pretty even spread across all of those packages. We would certainly like to see more agents using our products, which would mean-
I'm told this is a test.
Oh, is it? Okay. Which would mean-
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Less than 50% engaged.
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All right, thanks.
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Okay, you know, so our focus is as much on getting those agents to engage with products and moving them up the package curve. We're broadly happy with the number of agents on the top pack.
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All right, thank you. Maybe to chime in a bit on the New Homes side, right? Because that's obviously where we do have a higher, above 50% penetration. And that's totally fine, because the amount of listings coming from New Homes is such a small portion of overall listings, right? So generally speaking, you've got to remember from a consumer perspective, consumer eyeball perspective, competes with all the listings, right? It's not just within that category. So what we're happy with that level, and it can be higher as well, should that be the case.
We've got time for one more from Sean, if that's okay, and then we'll wrap it up there.
Morning, everybody. Sean Kealy from Panmure Liberum for the first time. I'd like to ask, well, it's sort of one question, but it might be a three-part, but I hope that's all right. Mostly sort of tacking close to M&A again. So if I think about the investment in Coadjute, you've earned about 7-- a little over 7% of that right now.
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So you're a little bit over 7% of that right now. Have you got any visibility on whether or not Coadjute might need follow-on investment, and sort of, would you be willing to make that investment, and would you? Is 7% the right ownership number for you, or would you look to increase that stake over time? That's sort of number one. Secondly, Johan, I think you've commented previously that Rightmove looks to make acquisitions or investments in companies which can benefit from its scale. Are there specific doors you're pushing on in support of Coadjute? Or I'd just like to hear a little bit about the strategy you're operating there.
And then thirdly, if I can ask about the costs of integration of, I guess, HomeViews at the moment, and if there are any for Coadjute in terms of the product yet, and roughly how much that sort of spend is, and any comments you can make on that as well?
I can take the first two. So we, we're a minority investor in Coadjute. We think it's an extremely interesting and potential technology platform for the future. It connects very well with, with our strategy and our ambition to, to make the business or the industry more, more effective, and directly support agents', you know, cash flow operations. But it's early stage. We are joined by, which is extremely exciting, three of the largest net lenders in, in the country, in this, in this investment. They're also minority investors in it, with one of them being the lead. So that's where we are right now.
There's obviously, you know, a lot of good, good thinking where this is gonna go, and quite a lot of action in, in starting to build as well, in terms of what these different parties do together with Coadjute, right? So, no further comment really on, on sort of ownership. That's, that's where we are right now. The, the second question, which I probably started to allude to, generally speaking. Well, first, generally speaking, yes, there's a lot of proptechs out there. And hypothetically, what some of them will need at some point, like all companies, is obviously scale of some, some kind, right? And that's one potential angle for my- for, for us.
Again, though, that doesn't mean that, oh, all of a sudden there are so many, because there are a lot of small proptechs out there, right? Alison alluded to our general policy, and that absolutely holds true. So it's just one of the reasons why it could be interesting. You know, that kind of cooperation around a specific case with Coadjute is exactly what's happening. So one of our most senior team members is on the Coadjute board. And we're laying out plans for how we obviously can collaborate and how we indeed can support them, right? But they are working as a standalone company. Again, we're a minority investor.
We actually learn from this ourselves, informs our pathfinding of where we want to take this domain, let's say, and obviously vice versa as well.
And then on HomeViews, Sean, we took costs of about GBP 700,000 in relation to HomeViews in the first half. So that was a mix of payroll of the members of the HomeViews team that we retained, and integration costs of their platform onto ours.
Yes.
Thank you, all.
Great. Thank you.
Very good. Thanks, everyone.
Appreciate you coming.