A building society that offloaded its loss-making 11-branch estate agency operation to the Belvoir group last year has revealed that the cost-cutting surgery failed to prevent it from making a second year of considerable overall losses.
The Nottingham lost £7.4 million after tax last year and £7.2 million after tax the year before.
Its latest poor results are blamed by the building society to a significant degree on its agency business, which was causing it financial problems prior to its disposal to Belvoir last summer.
But cut-through competition in the mortgage market and the challenges of Covid have also contributed.
The Nottingham operated an estate agency business for 25 years prior to the disposal, which until recently had successfully operated a model that offered those taking out mortgages a reduced-fee estate agency service as well as operating as a full-fee agency to all comers.
“But long-term shifts in the level of annual house purchases, how people now choose a mortgage provider and the increasing digitisation of estate agency services have all been medium term considerations for us,” says Chief Executive David Marlow (pictured).
“When taking all these factors into account, we determined that to remain a strong force in estate agency would require a level of investment that was difficult to justify.”
As we reported last year, the 11 estate agency offices operated by The Nottingham were transferred to the Belvoir group in return for continuing reduced-fee services for its members.
“We are very optimistic about the prospects of our strengthening alliance, which provides both organisations with a number of unique opportunities to work together in the future,” says Marlow.