Shares in estate agency group Countrywide have plummeted alarmingly after the government clampdown on letting fees was followed by a gloomy trading update today.
The Autumn Statement announcement that letting agency tenant fees would be banned sparked a share price downturn for a number of estate agencies, as Foxtons saw them plummet by 13% in a single hour before making a recovery.
Countrywide’s shares are currently 11.75% lower than yesterday after a third quarter trading update today revealed that transaction levels are running significantly below 2015.
The update showed that group revenue fell to £188.5m in Q3 2016 from £197.1m in the same period last year, while London transactions fell by 29% year-on-year.
Countrywide said its 2016 earnings will be “around the lower end of market expectations”.
Alison Platt, chief executive of Countrywide, said: “In light of the Chancellor’s announcement yesterday regarding letting agents’ fees, we look forward to working with the government through this consultation process.”
On the upside Countrywide’s remortgage activity was strong, as 19% of its customers have remortgaged in 2016 compared to 13% in 2015, while it expects to finish the year helping 25% remortgage.