Housing revival helps Rightmove shares to surge on market debut

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Shares in the country's biggest property website surged to 392.25p from the 335p starting price set by its adviser, the Swiss investment bank UBS.

The near £500m price tag placed on Rightmove equates to a giddy 58 times 2005 operating profits, reawakening memories of the heady days of the dot.com boom.

Demand for shares among big investors overwhelmingly outstripped the number on offer in the prelude to the flotation. The broker Panmure Gordon could have sold them 35 times over, it was said.

More than 20 million shares changed hands yesterday, as City institutions disappointed when allocations were made scrambled to pick up stock and private investors were able to buy for the first time.

Rightmove's four main owners - the life assurer Royal & SunAlliance, the mortgage bank HBOS and the estate agents Countrywide and Connells - sold just shy of one-fifth of the company in total to staff, major City investors and estate agents that subscribe to the site.

The flotation of Rightmove, which showcases about 650,000 homes for 8,500 estate agents, transformed a handful of bosses into millionaires.

Ed Williams, the group's chief executive, and the co-founders Miles Shipside and Nick McKittrick were each awarded shares worth more than £1.75m last night.

Mr Williams and Mr McKittrick are former management consultants with Accenture. Mr Shipside is a trained chartered surveyor.

Each of Rightmove's 200-plus workers were awarded shares worth about £600, with the company picking up their tax bill. They will be given the chance to buy a further £3,000-worth of stock.

Owners of the estate agency branches and the 950 letting agents and property developers that use the website were also invited to invest up to £3,000 each in the float. Mr Williams said the float gave Rightmove greater independence and flexibility to raise money in the future.

The country's biggest "clicks and mortar" website claims that 78 per cent of all those looking for property online visits its site. That's about 10 million isitors every month.

Rightmove also reckons to have captured about 60 per cent of all online property advertising spending in the six years since it was set up.

The company charges estate agents up to £250 a month to put their properties on the site.

Rightmove had sales of £18.2m in the year to December, up from £9.2m the year before.

The company expects new homebuyer packs, which become mandatory in June next year, to further boost future revenues.

The packs will provide prospective buyers with additional information about a property before they make an offer, and are expected to cost sellers between £750 and £1,000.

Rightmove said it plans to supply the information packs on its website as downloads and is currently investing in their preparation.