Foxtons yesterday reported a sharp drop in sales revenue in Q1 2026 as geopolitical uncertainty and higher mortgage rates hit buyer demand although growth in lettings helped offset the decline.
Total group revenue fell 10% year-on-year to £39.6m in the three months to 31 March, down from £44.1m in Q1 2025.
The decline was driven by a 35% fall in sales revenue to £10.7m, compared with £16.4m a year earlier, reflecting both a tougher market backdrop and a strong prior-year comparator ahead of the March 2025 stamp duty deadline.
Foxtons said new buyer activity was weaker than expected during the quarter, as uncertainty linked to the Middle East conflict fed through into rising mortgage rates and reduced product availability.
LETTINGS REVENUE UP
However, the group’s lettings division continued to provide resilience, with revenues rising 5% to £26.4m. Growth was supported by increased take-up of property management services, expansion in build-to-rent, and contributions from recent acquisitions.
The firm completed two acquisitions during the quarter, adding lettings businesses in Milton Keynes and Birmingham, as part of its ongoing strategy to scale recurring income streams.
Financial services revenue also edged up 3% to £2.6m, driven by refinancing activity and ancillary income, helping to offset weaker purchase volumes.
Despite the year-on-year fall, Foxtons said sales performance remains broadly stable compared to pre-2025 levels, with Q1 2026 revenue slightly ahead of Q1 2024.
COST-REDUCTION PROGRAMME
In response to softer transaction volumes, the group has launched a cost-reduction programme targeting at least £3m in annualised savings, alongside £1.5m already delivered through its HQ relocation earlier this year.
This includes repositioning the sales business, reallocating staff towards lettings and higher-growth areas, and improving operational efficiency.
Guy Gittins (main picture, inset), Chief Executive Officer of Foxtons Group, said: “Our strategic focus on recurring revenues has ensured that Foxtons has delivered a resilient performance despite recent market headwinds.
“In the quarter, we acquired lettings businesses in the high-growth, complementary markets of Birmingham and Milton Keynes. This, combined with organic growth and increasing take up of our property management services, meant that lettings revenues increased 5% in the period.
“The implementation of the Renters’ Rights Act on 1 May 2026 is expected to create growth opportunities for Foxtons. Higher regulatory requirements further underline the importance of working with a trusted, professional agent, and Foxtons’ scale, expertise and compliance capabilities position the business to protect landlords’ investments and capture market share.”
SUBDUED MARKET
But he added: “The sales market remains subdued and has been further affected by recent events in the Middle East, which have tempered buyer sentiment and impacted mortgage rates and availability. As ever, Foxtons is focused on what we can control by managing costs, increasing efficiencies and repositioning our sales business to mitigate the impact of the market.
“We remain confident that the resilience of our lettings and financial services businesses, which represents more than two thirds of revenues, alongside work to reposition the sales business, can continue to deliver market-leading results for customers, growth opportunities for our people and long-term value creation for shareholders.”
