Belvoir has this morning told shareholders that the effect of the Fees Ban coming into effect in June will be less than expected.
In a statement to the City the firm says: “The Board has assessed that the impact from the ban on tenant fees will be less than the previously estimated eight per cent of gross profit.
“The effect is now believed to be less than six per cent initially, reducing further to three over nine months.”
In a strategy that will be looked at keenly by competitors, Belvoir says the minimising of the fees ban impact is down to the company’s “diversification into financial services, and our franchisees adopting additional revenue streams.”
The comments come after the Belvoir Group told shareholders of what it calls “another year of continued and encouraging growth” with revenue up 21 per cent to £13.7m (2017: £11.3m): it says this strong showing is “outperforming both the sales and lettings elements of the housing market and the financial services market.”
Management fees from lettings were up 7.1 per cent, much of it down to Belvoir’s assisted acquisitions programme. Sales fees were up 8.5 per cent “compared with the HMRC reported two per cent decrease in the number of residential property transactions for 2018.”
Group income from financial services was also on the rise thanks to the first full year of ownership of Brook Financial Services and the lates-in-the-year acquisition of MAB (Gloucester) Limited.
Dorian Gonsalves, chief executive of Belvoir, says: “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’s diversification into financial services has also delivered growth, and our late-2018 investment in MAB Glos will provide the platform from which to offer specialist high street mortgage advice through our network of lettings and estate agents. The Board believes that Belvoir is well-prepared to both meet the challenges and take advantage of the opportunities anticipated in 2019.”
Source: Letting Agent Today