(Reuters) -UK's Foxtons (LON:FOXT) forecast resilience in its lettings business after posting a marginal rise in annual profit on Tuesday, as the strength in the rental business helped the estate agency offset subdued property sales activity.
A surge in demand for rental properties in London has led to a supply shortage and a spike in rents, boosting the lettings business of estate agents, at a time home sales transactions have remained weak for most of last year.
The volatility in mortgage rates and repeated repricing of home loans by lenders have hit British housing transaction volumes, although a drop in mortgage rates in early 2024 has rekindled recovery hopes.
"We are on track against our medium-term target of delivering 25 million pounds to 30 million pounds of adjusted operating profit, through organic and acquisitive growth and supported by improving market conditions," CEO Guy Gittins said in a statement.
Foxtons, London's largest lettings agent, said its adjusted operating profit from continuing operations for the year ended Dec. 31 was 14.3 million pounds ($18.1 million), compared with 13.9 million pounds a year earlier.
The company's annual revenue rose 5% to 147.1 million pounds, while lettings revenue - which accounted for about 70% of the group turnover - jumped 16% to 101.2 million pounds.
($1 = 0.7891 pounds)