REA Group Q1 FY27: Pricing Lifts Revenue to A$450M as Listings Slip 2%

REA Group, the owner of realestate.com.au, has reported its first quarter without its Indian business. Revenue rose 11% to A$450m, even though, the company says, national Buy listings fell 2% and listings in Sydney and Melbourne fell 16% combined. Highlights include:

• Revenue from core continuing operations of A$450m, up 11% (8% excluding acquisitions)
• EBITDA excluding associates of A$294m, up 12%
• Australian revenue of A$441m, up 9%
• Residential revenue up 10%
• Controllable Buy yield up 14%, with total Buy yield up 8% after geographic mix
• National Buy listings down 2%, with Melbourne and Sydney down 16% combined
• Buyer enquiries down 33% and seller leads down 9%
• FY27 outlook unchanged

Commenting on his company's performance, Group CEO Cameron McIntyre said:

"REA Group's Q1 performance was underpinned by strong double-digit controllable yield growth in our core residential business. The continued rollout of immersive and AI-powered experiences supported record engagement in the quarter with active members increasing and 5.3 million properties now tracked by their owner. In the currently challenging market conditions, the quality of our audience, and the quality of our seller leads, deliver the greatest value for customers and consumers."

Residential is REA's biggest business, and most of it is Buy. In Australia, the vendor, through their agent, pays to advertise a home on realestate.com.au, paying more for a bigger, better-placed listing, with Premiere+ at the top. Buy revenue depends on how many homes come to market and how much REA earns from each one, which it refers to as yield.

In Q1, an 8% average Premiere+ price rise, up from 7% in FY26, plus add-ons and more vendors trading up, lifted controllable yield 14%. Total yield, which also reflects where listings come from, rose 8%: on REA's figures, listings fell 16% across Sydney and Melbourne, its priciest markets, and rose 17% across Brisbane, Perth and Adelaide.

REA made the case for pricing at its investor day on 23 October. It put its ten-year yield CAGR at 14% and said its take rate was "only 2 basis points higher than over the last six years". McIntyre told investors: "we will continue to price to our value over time."

The same Q1 release has McIntyre warning about demand: "Tax changes and higher borrowing costs will continue to weigh on buyer demand but homeowner equity buffers, limited forced selling and low unemployment will support the market."

Buyer enquiries averaged 1.9 million a month, down 33%, according to REA's Adobe Analytics data, and its internal figures show seller leads down 9%. Its own engagement tools moved the other way: on internal data, active members rose 9%, and properties tracked by their owners rose 13% to 5.3 million.

By mid-October, Australian house prices had fallen for six consecutive months, according to the AFR, which also reported that Sydney hedge fund Bristlemoon Capital had shorted REA on the view that new listings could drop by as much as 10% in 2027.

Domain, the CoStar-owned number two, has gone the other way on price, capping its annual rises at 4% from July, and says it is closing the audience gap. REA's release, citing Ipsos iris, puts realestate.com.au 97.5 million monthly visits ahead of its nearest competitor. Ipsos iris has been Australia's industry measure of online audiences since IAB Australia launched it in 2023. It changed its methodology in July, and REA says that rules out comparisons with last year.

Without India, Australia now accounts for A$441m of REA's A$450m revenue. REA completed the sale of Housing.com to Aurum Proptech on 29 September, booking a small net gain, nine years after it first invested in Housing.com. REA India keeps a 24.9% stake in Aurum, and on the new basis last year's first quarter revenue was A$405m rather than the A$429m reported at the time. REA's next move abroad is a minority one: a 35% stake in Distilled, owner of Ireland's Daft.ie, due to close by the end of 2026.

Operating expenses rose 9% to A$155m, or 2% excluding acquisitions, with Australian costs up 3%, so EBITDA excluding associates grew faster than revenue. At A$294m, it gave a margin of 65.3%, against 64.7% a year earlier.

REA kept its FY27 guidance, including new national Buy listings down low single digits for the year. October listings were down 13% on last year, or 8% adjusting for one less working day.