Tenant fees ban – Forecast profit impact reducedMake Text Bigger
Belvoir Lettings PLC provided the following update to the London Stock Exchange on the outcome of the financial year ended 31 December 2018 and the outlook for 2019.
The Board has assessed that the impact from the ban on tenant fees will be less than the previously estimated 8% of gross profit. The effect is now believed to be less than 6% initially, reducing further to 3% over 9 months. This encouraging development is the result of the Group’s diversification into financial services, and our franchisees adopting additional revenue streams.
Dorian Gonsalves, CEO of Belvoir commented:
“In 2018, Belvoir delivered on its promise to support franchisee growth through its Assisted Acquisitions programme, adding network revenue of £6.9m, ahead of our £6.6m target for the year and over double that achieved in 2017. Meanwhile, we are also pleased to see our organic lettings growth and our increase in sales transactions exceeding market performance.”
The Group has achieved another year of continued and encouraging growth with revenue up 21% to £13.7m* (2017: £11.3m), outperforming both the sales and lettings elements of the housing market and the financial services market. Management service fees (‘MSF’) from lettings was up 7.1%, with underlying growth of 2.6% noticeably ahead of the UK rental index of 1.8% and a further 4.5% resulting from Belvoir’s successful assisted acquisitions programme. On the property sales side, MSF was up 8.5% compared with the HMRC reported 2% decrease in the number of residential property transactions for 2018.
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