Foxtons Group reported a 13% decline in house sales revenue for the first half of 2025, as buyer caution linked to UK political uncertainty and the ongoing Middle East conflict weighed on transaction volumes. The London-focused estate agency, one of the capital’s most recognizable property brands, responded by accelerating cost-cutting measures, including office closures and headcount reductions, to protect profit margins.
Sales slump deepens amid macro headwinds
Foxtons said revenue from its sales division fell to £38.5 million in the six months to June 30, down from £44.2 million in the same period last year. The company attributed the decline to a cautious buyer sentiment driven by the UK general election campaign, which created uncertainty over housing policy, and the broader economic impact of the Middle East war on consumer confidence.
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The sales performance was partially offset by growth in Foxtons’ lettings business, which posted a 5% revenue increase to £58.3 million, as rental demand in London remained resilient. The group’s mortgage broking arm also saw modest gains, with revenue rising 3% to £7.1 million. Overall group revenue fell 4% to £103.9 million, while adjusted operating profit dropped 12% to £10.2 million.
Cost-cutting strategy intensifies
Foxtons has been restructuring its operations to adapt to a lower-volume market. The company closed several underperforming branches and reduced its workforce by around 10% over the past year, moves that CEO Guy Gittins said were necessary to align costs with current market conditions.
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“We are taking decisive action to protect the business in a challenging environment,” Gittins said in a statement. “The sales market remains subdued, but our lettings and financial services divisions provide a strong foundation. We are focused on maintaining profitability and positioning the group for recovery when market conditions improve.”
The cost-cutting program is expected to deliver annual savings of approximately £8 million, according to the company. Foxtins also renegotiated leases on several offices and reduced marketing spend, though it said it would continue to invest in its digital platform and lead generation tools.
London market faces extended slowdown
Foxtons’ performance mirrors broader trends in the London property market, where transaction volumes have fallen sharply since the mini-budget crisis of 2022 and have yet to recover fully. Higher interest rates have reduced borrowing capacity for buyers, while political uncertainty — including the recent UK general election that brought a Labour government to power — has prompted many potential purchasers to delay decisions.
Industry data from Nationwide Building Society showed London house prices rose just 0.6% year-on-year in the second quarter of 2025, well below the UK average of 2.1%. The number of property sales in the capital fell 8% over the same period, according to HM Land Registry figures.
The Middle East conflict has added an additional layer of uncertainty, particularly for London’s international buyer segment. Foxtons noted that demand from buyers in the Middle East and Asia had softened, though it said the lettings market remained supported by strong rental demand from domestic tenants.
Analysts at Jefferies said in a note that Foxtons’ cost-cutting measures were “appropriate” given the market outlook, but warned that a sustained recovery in sales volumes would depend on interest rate cuts and improved consumer confidence. The Bank of England held its base rate at 5.25% in August, with markets pricing in a first cut in late 2025.
Foxtons shares fell 2.3% on the day of the results, underperforming a flat FTSE 250 index. The stock has declined 18% over the past 12 months, reflecting investor caution about the outlook for London estate agents.
Looking ahead, Foxtons said it expects the sales market to remain challenging through the second half of 2025, with no immediate catalyst for a rebound. The company plans to continue its cost reduction program while focusing on growing its lettings and mortgage broking businesses, which provide more stable recurring revenue streams.
