London calling? Foxtons says lower rents attracting more tenants

UK-based real estate agency Foxtons (LON:FOXT) Group Plc said on Wednesday more tenants are filling buildings in London, attracted by a 12% drop in rental prices during the COVID-19 pandemic.

Foxtons, which assists people in both renting out properties and selling them, bolstered its presence in London over the past year with the purchase of Douglas & Gordon.

“We have seen good growth in lettings applicants and listings, and revenues have now returned to pre-lockdown levels,” Foxtons said.

The outlook bodes well going into Spring, a key deal-making season. The real estate market as a whole was hammered last year as lockdowns and subsequent uncertainties about the future prevented people from making big life decisions, while companies held back on discretionary spending.

Foxtons was forced to tap markets for additional cash and furlough employees last year, but a tighter control on costs helped it post a smaller statutory loss before taxes of 1.4 million pounds for the 12 months ended Dec. 31 from 8.8 million a year earlier.

The company said it has seen strong profit growth in the first two months of 2021 as its sales commission pipeline jumped 30% compared to a year earlier, with the value of it reaching levels not seen in four years.