London estate agency Foxtons has announced a 57% fall in pre-tax profit, reaching £4.4m for the six months ending June 30. This decline is attributed to challenging sales market conditions and the impact of the Renters' Rights Act on its lettings business.
Overall revenue for the period decreased by 3% year-on-year to £83.7m. Sales revenue saw a 13% reduction, primarily due to lower transaction volumes, which the company linked to reduced stamp duty-driven activity compared to the previous year, alongside weak consumer confidence and higher interest rates.
The introduction of the Renters' Rights Act resulted in a £3m reversal of previously recognised revenue within the lettings sector, following an increase in tenant-led tenancy terminations. This directly contributed to a 29% fall in adjusted operating profit, which stood at £8.9m. Foxtons expects the impact of elevated tenant terminations to moderate and stabilise in the latter half of the year.
Despite the challenging environment, Foxtons maintained its interim dividend at 0.24p per share. The company anticipates full-year 2026 adjusted operating profit to be between £17m and £19m, with performance expected to be stronger in the second half.