Estate agent Savills has upgraded its profit outlook for 2014 after changes to stamp duty came into effect at the end of last year, sending shares surging almost nine per cent in early trading.
Revenue and profit exceeded forecasts in December after a sales boost from the rise in Stamp Duty for properties priced over £937,000 introduced in chancellor George Osborne’s Autumn Statement.
“The rise in Stamp Duty on high value UK residential transactions which caused a short-term increase in trading volumes,” the property firm said. Wealthy buyers scrambled to complete deals on 3 December, the day of the announcement, to avoid being charged at the higher rate.
The full-year upgrade was also driven by “a number of sizeable transactions” in the UK and European commercial markets and the earlier close of its Nordic Logistics Fund bringing forward revenue previously expected in the first quarter of 2015.
Analysts at Numis now expect pre-tax profit of £99m, up from previous estimates of £90m.
Underlying profit for the year to 31 December will now be “well ahead” of previous expectations, however the property firm remained cautious in its outlook for 2015.
“For 2015, we retain our cautious stance particularly on the performance of the UK residential market in the first half of the year, as a result of continued uncertainty around the UK General Election, and the timing of a sustainable recovery in Hong Kong.”