A City analyst has welcomed Rightmove’s deferred payment option as ‘sensible’ – but also warned that it could be a stretch for some agents who will eventually have to pay.

Analysts at Shore Capital also cast doubt whether Rightmove could maintain its current rates (ARPA) paid by agents.

In a note to investors  yesterday, Shore Capital said: “We view this [the deferment scheme] as a sensible initiative both in practical terms and from a goodwill perspective at a very difficult time for its customers.

“That said, we note that, based on RMV’s average monthly ARPA of £1,088 during FY19A, agents opting for a £500 per month deferral would still pay £588 per month per branch and face the prospect of moving back to a higher monthly outlay and repaying £500 per month three months down the line.

“We believe that this could be a stretch unless the market bounces back rapidly and that current circumstances could also lead to a reappraisal of portal costs even in a more normal environment.

“It is also worth bearing in mind that some agent offices pay significantly more than this monthly average, creating an even more acute issue if property market transactions stall.

“We continue to regard Rightmove as a high-quality company with a proven business model, a strong financial position and an excellent track record.

“However, the circumstances facing its customer base adds to our long-standing concern that moving prices ahead from current levels will prove increasingly difficult to achieve following a period of sustained and substantial inflation.

“Without wishing to be overly negative, we are concerned that it may in fact prove challenging to maintain ARPA at current levels and to meet our expectations.”

Shore Capital maintained its Sell recommendation on Rightmove shares.

Separately, another City analyst has given its view of OnTheMarket’s decision to cut fees by 33% for those agents who pay the full listing rate.

Zeus said that this shows that “OTM understands its paying customer base”.

However, it cautioned that the revenue impact will be £1.5m.