Foxtons Group has reported a robust start to the year this morning with financial services revenue rising 7% in the first quarter, driven by a surge in mortgage activity linked to stamp duty incentives and stronger sales conversion.
The estate agency also delivered its highest quarterly sales revenue since before the Brexit vote, capitalising on a pre-deadline spike in first-time buyer demand.
Group revenue for the quarter climbed 24% to £44.1 million, up from £35.7 million a year earlier.
While the standout performance came from a 73% jump in sales revenue to £16.4 million, financial services played a critical supporting role – with mortgage adviser productivity through subsidiary Alexander Hall offsetting a significant fall in refinancing activity.
INCREASED ACTIVITY
Revenue from new mortgage transactions soared 71% year-on-year, reflecting Foxtons’ ability to convert increased housing market activity into tangible brokerage income.
The surge was linked to the run-up to the 31 March stamp duty relief deadline, which incentivised first-time buyers to complete purchases before tax breaks expired. However, revenue from remortgages slumped by 38%, as fewer borrowers came to the end of fixed-rate deals during the quarter compared to the same period last year.
RATE-SENSITIVE
Chief Executive Guy Gittins (main picture) said: “The strong rise in new mortgage revenue highlights the operational improvements in our Sales and Financial Services teams, and our growing share of wallet in the homebuying journey. But the refinance shortfall underlines just how rate-sensitive the market remains.”
Lettings revenue rose 5% to £25.2 million, bolstered by recent acquisitions in Watford and Reading, which have now been integrated into the Foxtons brand.
The Group also completed the bolt-on acquisition of Watford-based Marshall Vizard during the quarter, further consolidating its presence in high-value commuter markets.
Despite a dip in its under-offer sales pipeline at the end of March – down around 10% year-on-year – Foxtons remains bullish.
Management expects the pipeline to rebuild in Q2, particularly if interest rates begin to fall faster than anticipated.
BUMPER START
Julie Palmer, Partner at Begbies Traynor, said: “There’s no question that Foxtons have had a bumper beginning to 2025. Benefitting from the rush from buyers focused on beating the stamp duty deadline, the estate agent today announced their highest quarterly sales in nearly a decade.
“The main question for London’s leading operator is whether this level of performance is sustainable.”
“The spectre of interest rates looms large and a further cut will be decisive in determining market confidence.”
“Indeed, in this environment, it will have to work hard to ensure its reduced pipeline is not the start of a tailing-off, but encouragingly the lettings side of the business, that is less susceptible to swings in sentiment, looks to be doing well.
“As ever, the spectre of interest rates looms large and a further cut will be decisive in determining market confidence.
“Foxtons should be reassured by recent remarks from the Bank of England that a cut is on the way. While it’s anything but certain, a cut next month could help mitigate the effect of the recent millionaire exodus from London which many fear has been supressing property prices.”
