Reeds Rains owner expects ‘substantially lower’ profit due to tough mortgage market
LSL Property Services, which owns estate agents Reeds Rains and Your Move, said on Monday it now expected the group’s annual profit to be “substantially lower” than previously forecast due to subdued activity in the British mortgage market.
The British housing sector is in the middle of a pronounced slowdown, as high mortgage costs and tight credit conditions eat into demand. The Bank of England has raised interest rates 14 times in a row since December 2021 to 5.25 per cent, in its bid to tackle raging inflation.
The company said it expected there would be lower levels of purchase and remortgaging activity than previously forecast for the second half of the year.
LSL said its performance in the six months to June 30, particularly in its surveying and financial services division, was impacted by significant changes in the mortgage market.
The company has about 2,700 advisers and represents around 10 per cent of the total purchase and remortgage market in the UK.
Its share price was down over 11 per cent by the early afternoon.
Reuters – by Aby Jose Koilparambil