London estate agent Foxtons this morning said it was confident in the capital’s “resilient” housing market, despite reporting widening losses for the first half of the year due to coronavirus restrictions.
In the half year to 30 June group revenue fell 22.2 per cent to £40.4m as the housing market was brought to a standstill in March as the government imposed a UK-wide lockdown.
Foxtons reported a loss before tax of £4.3m, compared to last year’s loss of £2.5m, and a loss per share of 1.8p.
The estate agent will not pay a dividend to shareholders.
At the end of the period, Foxtons had a cash balance of £45.5m, up from £14.5m, which was buoyed by a £22m share sale.
Sales commissions in June were down 44 per cent and in July were down 32 per cent against last year.
The pipeline has strengthened since reopening and is now broadly in line with last year, Foxtons said.
Why it’s interesting
The UK housing market was brought to a standstill in March after the government announced a coronavirus lockdown.
A strong start to the year following the Conservative’s decisive general election win in December – the so-called Boris bounce – was offset by the enforced closure of Foxtons’ branches and a ban on viewings.
In the second quarter, at the height of lockdown, group revenues were down 38 per cent compared to the previous year. Lettings, sales and mortgage revenues fell 34 per cent, 53 per cent and 14 per cent respectively.
Revenue also took a £1.4m hit due to the tenant letting fees ban.
Foxtons said it was cautious about the impact Covid-19 will continue to have on the London property market in the coming months, but said it was well-prepared to deal with any further coronavirus restrictions.
However chief executive Nic Budden said he is “confident in London’s resilience and ability to bounce back from this crisis as one of the most attractive property markets in the world.”
What Foxtons said
“Before lockdown we were seeing first signs of a recovery from the prolonged downturn in London, however the market has been profoundly affected by the Covid-19 pandemic and it is still unclear what the long-term impact of the virus will be,” Budden said.
“There is a long road ahead, but we remain confident in London’s resilience and ability to bounce back from this crisis as one of the most attractive property markets in the world.
“With the determined action that we have taken to ensure financial and operational flexibility, as well as ensuring the safety of our employees and customers, we remain confident that Foxtons is well-placed to capitalise as the market recovers.
“In such challenging times, we are committed to delivering the best results for our customers.”