LONDON (Alliance News) - Estate agency M Winkworth added to the gloom in the sector on Tuesday after it said an anticipated rise in property transactions following the UK General Election had not materialised, meaning its profit for the full year will fall short of market expectations.
The company said that despite the Conservatives winning a majority in the UK's General Election in May, a bounce in the housing market which had been anticipated has not happened. Its warning echoed that of Countrywide PLC, the UK's largest estate agency group, which cautioned last week on its full-year outlook for the same reasons.
Winkworth and Countrywide both blamed changes to the stamp duty regime in the UK for the problems, given this has slowed down property transactions at the top end of the market as buyers are now paying more than under the previous system.
Revenue for the year is set to be broadly flat year-on-year, the company said, but profit will fall slightly behind market expectations due to the slower-than-expected transaction volumes.
Winkworth expects the conditions to continue into 2016 but said this should provide it with opportunities to agree deals with new franchisees and expand its overall business.
Still, shares in the company were down 11% to 145.00 pence on Wednesday, one of the worst performers in the London main market.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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