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Agencies & People

Leading property firm share prices fall as Woodford investment saga continues

Stock in most of the leading estate agency groups and many house builders took a tumble yesterday as City jitters spread.

Nigel Lewis

neil woodford

The share prices of all but two of the UK’s key residential property PLCs fell yesterday as the ongoing demise of Purplebricks backer Neil Woodford caused jitters in the City.

Shares in Countrywide, Foxtons, Hunters, LSL, OTM, The Property Franchise Group and Purplebricks all fell as news filtered through that another property-related company, construction giant Kier, is to sell its home building division, cut 1,200 staff to reduce its debt and cut costs by £55 million a year.

Kier, along with Purplebricks, has seen its share price reduce dramatically in recent months and the two companies’ disastrous stock performances have been blamed for the City’s loss of confidence in Woodford.

But while property companies suffered, the FTSE 100 Index increased by 1.17% and the FTSE 250 by 0.8%.

The only companies to see their shares unaffected by the run were Belvoir, whose stock did not move, and Savills and Rightmove, which saw modest share prices gains.

Other property-related companies that saw their stock reduce in value yesterday included Barratt Developments, Redrow, Bellway and Bovis.

FCA investigation

Woodford’s woes increased yesterday too. The Financial Conduct Authority revealed that it has launched an investigation into the suspension of his Woodford Equity Income Fund.

Earlier this month the FCA said it would open an investigation if it believed there were circumstances suggesting ‘serious misconduct or non-compliance with the rules’.

On the day that dealing in the fund was suspended by Woodford, it was revealed by the FCA yesterday that £296 million had been withdrawn by investors including Kent County Council, which had withdrawn £238 million.

June 19, 2019

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