Belvoir Lettings says it's too early to predict impact of no fees

AIM-listed Belvoir Lettings said it could not predict the impact from not charging fees to tenants, as outlined in the Autumn Statement.

On Wednesday, Chancellor Philip Hammond said there would be a ban on letting fees “as soon as possible”, in a bid to help the ‘just about managing’, which would save 4.3m households hundreds of pounds a year.

There is to be a consultation period, but Belvoir said at the moment it could not predict the likely impact for the year ended December 2017 and beyond.

The company said that based on experiences following a similar proposal in Scotland in 2012, it “anticipates that mitigating action should be possible over time" and that no franchisees were lost in Scotland as a consequence of the decision.

Fess account for around 10% of revenue for the company's franchisees, but due to the broader revenue streams the impact on gross profit is expected to be less than 8%.

It added that the impact “may well be far greater for many of the large number of independent letting agents”.

Neil Wilson, markets analyst at ETX Capital, said that announcement in the Autumn Statement could not come at a worse time for the property sector. Countrywide has said that its was affected by the uncertainty arisen in the wake of Brexit and changes in stamp duty.

Shares in letting agents fell on Wednesday as Foxtons, which mainly focuses on London, was down 10.6% at 110p per share, Countrywide shares were down about 5% and LSL Property also fell around 5% to 207p.

Shares in Belvoir Lettings were down 5.83% to 113p at 0948 GMT.