Two of the biggest estate agent chains in the UK – Countrywide and Foxtons – have seen their profits plummet in the first half of the year, with the housing market showing signs of slowing down.
Countrywide is the UK’s largest estate agent, and posted a 98 per cent drop in pre-tax profits. In the first half of 2016, its profits were £24m, but in the same period of this year it was £450,000.
In the first half of this year Countrywide sold 20 per cent fewer homes than in the same period for 2016, and shares in the company have now dropped a record 9.7 per cent.
“We are building a stronger business for our future and remain on track with our goals to broaden our digital capability, reduce our operating cost base and strengthen our balance sheet,” said Alison Platt, chief executive of Countrywide.
“Based on our current performance and the outlook for housing transactions in the UK, we expect our results and our leverage for the full year to be within the range of market expectations.”
She added: “We’re not optimistic about the housing market in the next half and our mantra has been one of self-help.”
Foxtons, which is based in London, posted a 64 per cent drop in profits. In the six months to the end of June, profits were £3.8m, having been £10.5m for the same period of 2016. The company’s group revenues also fell from £68.8m to £58.5m, a drop of 15 per cent.
Chief executive Nic Budden said: “Our performance has been resilient in the context of a London property market that has been further impacted by unprecedented economic and political uncertainty.”