Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property Industry Eye. Read the original article for full details.

Foxtons Profits Fall as Sales Slowdown and Rental Reforms Impact Trading

Foxtons has reported a significant decline in first-half profits for 2026, attributing the drop to a weaker sales market and the introduction of the Renters’ Rights Act. The London-focused estate agency group saw revenue fall to £83.7 million for the six months to 30 June, down 3% compared to the same period last year, with pre-tax profit dropping 57% to £4.4 million.

Sales revenue at Foxtons declined by 13%, which the company linked to lower transaction volumes following last year’s stamp duty-driven activity, as well as weaker consumer confidence, higher-than-expected interest rates, and geopolitical uncertainty. In contrast, lettings revenue was broadly flat, with growth in Build to Rent operations, landlord services, and recent acquisitions offset by a £3 million reversal of previously recognised revenue. This reversal followed an increase in tenant-led tenancy terminations after the introduction of the Renters’ Rights Act, directly impacting profitability and contributing to a 29% fall in adjusted operating profit to £8.9 million.

Financial Services was a positive area for the group, with revenue rising 20% due to stronger refinancing activity and increased ancillary income. Foxtons reported that recurring and non-cyclical income streams now account for 69% of total revenue, up from 65% a year earlier.

The company implemented cost-saving measures during the period, generating £1.3 million of savings in the first half and expecting annualised benefits of around £4.5 million. Net debt increased to £28.4 million, reflecting lower cash generation, acquisition spending of £8.8 million, and shareholder returns. Foxtons increased its revolving credit facility from £40 million to £50 million to support future growth.

Despite the challenging trading environment, Foxtons maintained its interim dividend at 0.24p per share. The group stated that operational and cost actions taken during the first half have left it better positioned for future growth, despite ongoing uncertainty in both the sales and lettings markets.