Foxtons reveals early impact of Renters’ Rights Act as lettings revenue drops

The introduction of the Renters’ Rights Act has pushed lettings revenue down at Foxtons, the agency giant has revealed.

A third quarter (Q3) trading update from Foxtons this morning revealed that revenue has declined by £2.3million, or 7%, to £31.1million, after a £2.7million impact from elevated tenant-led early terminations following the introduction of the Renters’ Rights Act on 1st May 2026.

Before this impact, revenue was marginally ahead year-on-year, including £1.0million of incremental revenue from acquisitions.

Consistent with expectations set out in its interim results, early terminations eased throughout the third quarter and October, indicating that elevated activity reflects a short-term transition following the introduction of the reforms, Foxtons said.

Lettings traded broadly in line with our expectations, with the initial disruption following the introduction of the Renters’ Rights Act.”

Third quarter sales revenue also declined by £600,000, or 5%, to £12million in a challenging sales market.

Foxtons said its like-for-like transaction volumes remained broadly stable, but average revenue per transaction declined 8%, reflecting a mix weighted towards lower-value properties, as higher mortgage rates impacted buyer affordability at higher price points.

Year-to-date revenue declined by £4million, or 10%, to £35.5million.

Market share has been maintained following the downsizing of the sales business in the first half of the year to protect profitability, Foxtons said.

Foxtons said the group is trading in line with management’s expectations and expects full-year adjusted operating profit to be within the £17million to £19million range guided in July.

Resilient returns

Guy Gittins (pictured), Chief Executive Officer, says: “We delivered a resilient performance in Q3 despite a challenging market backdrop. Lettings traded broadly in line with our expectations, with the initial disruption following the introduction of the Renters’ Rights Act moderating through the quarter and re-letting activity remaining robust. We continue to see longer-term benefits from the RRA, notwithstanding some short-term volatility.

“We continued to execute our growth strategy, completing four acquisitions in September to scale our Birmingham operations and strengthen our market-leading positions in Watford and Reading. These acquisitions further demonstrate the opportunity to extend the Foxtons Operating Platform into attractive regional markets and deliver long-term value through operational synergies and growth.”

Gittins adds that while last week’s Budget provided more details on the Government’s Your First Home scheme, he warned that it shouldn’t be limited to new builds.

He says: “First-time buyers deserve real choice, and extending a modified version to pre-owned homes would help free up the wider market and avoid the price inflation seen under Help to Buy. If the goal is to get more people into homes that suit their needs, stamp duty remains the biggest barrier at every price point, and we’d urge the Government to keep it firmly on the agenda.

“We remain focused on growing recurring Lettings revenues, delivering attractive returns from acquisitions, and improving productivity across the Group through operational upgrades and value-enhancing technology, including AI. Supported by the Foxtons Operating Platform, these priorities underpin our confidence in the Group’s long-term growth potential.”