Foxtons reports lower revenue but says London residential market has gained momentum

Estate agency group Foxtons is led by Nic Budden (Picture: AFP/Getty Images)

London estate agency Foxtons on Thursday said the residential market in the capital has gained momentum recently, but overall third quarter revenues fell.

Sales decreased to £28.5 million, down 10% from a year earlier, with revenues in the sales and letting divisions both lower.

The housing market started to improve during the three months to September 30 following a difficult second quarter when Covid-19 disrupted the sector.

Estate agents and housebuilders suffered at the start of the lockdown as people were urged to avoid moving where possible and viewings stopped. Restrictions were eased in May, and there has been pent-up demand for properties since. A stamp duty holiday has also enticed people.

However, Foxtons pointed out that its lettings division was impacted by a “significant” reduction in the number of overseas student tenants and corporate relocations. Travel restrictions and people working from home where possible has resulted in fewer high value short-term lets.

But Foxtons, led by Nic Budden and known for its fleet of Mini Coopers, said business activity significantly increased in the third quarter, with “valuations, instructions, applicant numbers and viewings all considerably up on last year” across both lettings and sales.

Budden said: "Foxtons has made good progress in the third quarter, during which we were able to capitalise on increased levels of market activity, driven by the decision to build back capacity soon after the lockdown ended. We have successfully re-built the sales commission pipeline to its highest level in 3 years.”

He added: “Although the London residential market has gained momentum, we remain cautious as economic uncertainty causes more sales transactions to fall through and is putting downward pressure on rents."

Following the coronavirus outbreak Foxtons launched virtual video tours of properties to help buyers and sellers during the lockdown.

The firm drew up basic guidelines for tenants, landlords and sellers on filming homes using phones, including what parts of the property to include and focus on. Those were then sent to Foxtons’ sales and lettings agents who got a virtual crash course in iphone film editing from the marketing team.