REA Group says increasing fees on customers of its Australian property classifieds helped the company overcome a huge drop in listings, with third-quarter revenue rising seven per cent to $198.6 million.
REA, which operates realestate.com.au and is majority-owned by the Rupert Murdoch-controlled News Corp, said listings across the country fell by nine per cent in the three months to December 31 compared to the previous quarter.
The company said its real estate classifieds declined 12 per cent in Melbourne and 18 per cent in Sydney in the March quarter.
“The revenue growth reflects the price changes that took effect from 1 July 2018, improved product mix and depth penetration,” REA said in a release to the ASX on Friday.
Shares in the company rose 0.88 per cent to $81.85 by 1133 AEST but were still down from $84.30 a year ago.
A continued slide in home prices and a drop-off in project commencements, particularly in the two largest Australian cities, meant the group faced a “particularly challenging market” but it planned to advance by focusing on supporting its customers.
REA said revenue in its financial services segment had fallen on the prior comparative period because of tighter lending conditions.
“The decline in mortgage settlements is expected to continue for the remainder of the financial year and into the first quarter of FY20,” it said.
“Market conditions are not expected to improve in the short term,” REA said in its outlook as the Easter long weekend and Anzac Day were likely to cause lower revenue growth in the fourth quarter.