London Daily

Focus on the big picture.
Sunday, May 11, 2025

Foxtons cashes in on London rents aided by 'longer non-cancellable tenancy deals'

Foxtons cashes in on London rents aided by 'longer non-cancellable tenancy deals'

The company's latest update to investors shows how it is benefiting from the lettings market at a time when house prices are easing back following their COVID pandemic era spurt.

The London-focused estate agency Foxtons has been accused of "boasting" after recording a 27% leap in lettings revenue, partly aided by a focus on securing "longer non-cancellable terms" from tenants.

The company reported a 10% increase in total revenue to £32.9m during the first three months of the year - driven by its lettings division which contributed £22.8m of that sum.

Poor availability and high demand saw rents rise by an inflation-busting 20% in 2022, with the most recent data from HomeLet showing costs still going up.

The average London monthly rent stands at just under £2,000, it reported.

The private rental market has been boosted by growing affordability concerns over house purchases as the Bank of England raises its main interest rate to combat high inflation.

"Organic revenue growth was underpinned by operational improvements and an increase in average revenue per transaction", Foxtons said of its lettings performance.

"Growth in average revenue per transaction includes a focus on securing longer non-cancellable tenancy terms (resulting in a greater proportion of revenue being recognised at the start of the tenancy), increased cross sell of our higher value property management service, and higher average rental prices."

Longer tenancy terms are potentially attractive to all parties.

House prices have eased back while the rental market has been described as 'frenzied'


That is because landlords have greater sight over their short term yields while such deals also give tenants clarity over their costs, despite being locked in for longer.

The shortage of properties is a strong bargaining chip for Foxtons while a recent report for the Royal Institution of Chartered Surveyors warned that fierce competition for rented properties would continue to squeeze prices higher.

It described the lettings market as "frenzied".

Dan Wilson Craw, acting director of the campaign group Generation Rent which speaks up for private renters, told Sky News that tenants were being squeezed horribly by the lettings market.

He said of Foxtons' performance: "This is more to do with the long-term failure to build enough homes to meet demand than Foxtons' operational nous.

"But it is nevertheless grim to see the company boasting about practices that sound like forcing tenants into longer fixed term tenancies or paying multiple months' rent up front.

"Generation Rent has heard from renters who have been told by agents that the only way to secure a tenancy is to sign up for a two- or three-year term, or pay more up front.

"In a normal market, where tenants had a reasonable choice, Foxtons wouldn't be able to name their terms in the same way."

The Office for National Statistics released data on Thursday showing that Britons starting new private-sector housing tenancies spent an average of 26.8% of their income on rent in March.

That was up from 25% in March 2019.

The company, like its rivals nationwide, has struggled in sales of properties.

Transactions and prices have fallen amid the cost of living crisis and the backdrop of rising interest rates, which have made mortgages more expensive.

That slowdown in buying activity was particularly acute in the wake of the Liz Truss government's disastrous mini-budget of last September that spooked financial markets and forced a spike in home loan costs.

While the damage inflicted on rates from the so-called growth plan has now largely been eroded, Foxtons said on Thursday that sales revenues were 16% down on the same quarter last year due to a reduction in completions.

It blamed the fall on the drag caused by the mini-budget.

Sales typically take four months from a price being agreed to exchange.

But it was more upbeat on the future, telling investors: "During the quarter, we saw an increase in instruction market share and we completed the highest number of quarterly viewings in the last 5 years.

"Combined with growing levels of buyer demand, this has supported good growth in the value of the under-offer pipeline over the course of the first quarter."

Newsletter

Related Articles

0:00
0:00
Close
Trump's Upcoming Visit to Gulf Nations: Investment and Security at the Forefront
Rodrigo Duterte Awaits Trial at The Hague. Next week he might be elected mayor of his hometown
Trump fires director of U.S. Copyright Office, sources say
Retired British police officer arrested over ‘thought crime’ tweet
Cardinal Robert Prevost Elected as Pope Leo XIV, Marking a Historic Papacy
Newark Mayor Ras Baraka Arrested at ICE Facility Amid Congressional Visit
India-Pakistan conflict may be first test for Chinese military tech
Bill Gates Announces Plan to Wind Down Philanthropic Foundation and Disperse Wealth
Historic Papal Conclave Set to Commence in Rome
Huge Copper, Gold, and Silver Discovery in Argentina and Chile — But the Profits Go Abroad
Prince Harry is pleading for reconciliation — but the royals are just as sick of his victimhood as everyone else
The Road to Freedom: She Protested Putin, Escaped House Arrest, and Survived a 2,800-Kilometer Journey
OpenAI's Flip-Flop: No Longer Going Commercial, Back to Nonprofit, After Musk Lawsuit and Backlash
“Trump Supporter” Aims to Bring a MAGA-Style Shift to Romania
First From China: Zhao Xintong Wins the Snooker World Championship
Nvidia Faces Billion-Dollar Losses – Warns: China Is on Its Way to Becoming an AI Superpower
Trump Rules Out Third Term, Names JD Vance and Marco Rubio as Potential Successors
Mexico Says ‘No’ to U.S. Troops: President Sheinbaum Rejects Trump’s Offer to Fight Cartels
Nigel Farage’s Reform UK Storms the Map, Wrecking the Two-Party Monopoly
DOGE: Reimagining Government Operations with AI
Common Sense Returns to Britain's Legal System: UK Supreme Court Declares a Woman Is… a Woman
Beijing Says U.S. Is ‘Reaching Out’ for Tariff Talks Amid Soaring Trade Tensions
U.K. Court Rejects Prince Harry’s Final Appeal Over Police Security
Prince Harry’s Heartfelt Outburst Rocks the Royal Family
Trump Shares AI-Generated Image of Himself as… Pope, Prompting Outrage Reaction
Transgender Swimmer Secures Five Gold Medals at U.S. Masters Championship
Prince Harry: “I Want Reconciliation with My Family”
Germany's Alternative für Deutschland (AfD) party has now been officially labeled “right-wing extremist” by the federal office for the so-called “protection of the constitution.”
Amazon Launches Satellite Internet Service Amidst Competition with SpaceX
Transformative Changes in Women's Wrestling: The Rise of WWE Superstars
The Rush to the White Gold: Global Investment Surge in Natural Hydrogen Exploration
This is a day in Spain without electricity and internet
Reform UK Surprises in British Elections, Challenging Traditional Two-Party System
180-Year-Old Christian University in South Carolina Announces Closure Due to Unmet $6 Million Fundraising Goal
Brazilian Woman Jailed for Fourteen Years for Writing “You Lost, Idiot” on Statue During Protest
Trump Administration Removes National Security Adviser Mike Waltz Amid Signal Chat Controversy
Dutch Politician Eva Vlaardingerbroek Receives Spyware Threat Alert from Apple
Paramount Board Considers Settlement in Trump’s $20 Billion Lawsuit Over "60 Minutes" Interview
U.S. Economy Shrink in Trump’s First Quarter as Tariff Policy Raises Questions
Deadline Looms for RTS Meter Replacement: Hundreds of Thousands at Risk of Heating Disruption
Sweden Grapples with Deadly Gun Violence: Suspect Arrested After Three Young Men Killed in Uppsala Hair Salon
Walz Reveals Why Harris Chose Him as Her Running Mate and Reflects on Democratic Losses
Spain Restores Power After Unprecedented Nationwide Blackout
Carney Secures Liberal Mandate in Canada’s Federal Election
Death Penalty Sought as Luigi Manion Pleads Not Guilty in CEO Murder Case
President Trump contacts Jeff Bezos after reports of Amazon considering listing tariff surcharges; company clarifies no such plan for main platform
Spain and Portugal Recover from Massive Blackout
Liverpool Clinches Record-Equalling 20th English League Title Under Arne Slot
Singapore Politicians Warn Against Foreign Interference in Election
Driver Ploughs into Vancouver Festival Crowd, Killing Nine
×