Shares in The Property Franchise Group (TPFG), which owns leading estate agency brands including Martin & Co and Ewemove, jumped by an unprecedented 10.5% yesterday following news that the company’s lettings business had performed better than expected.
As The Negotiator reported, the company revealed that its franchisees had seen lettings revenue increase to a record £5.96 million last month, driven principally by an average 10% increase in fees to landlords but also by lower business costs and higher rents.
TPFG’s share price has been rising since March. Since then City traders have considered franchised estate agency brands a safer bet as Brexit has loomed.
This is compared to more traditional estate agents PLCs such as Countrywide and Foxtons, which have struggled as the tenant fees ban and softer sales market has impacted their bottom line.
“A franchise offers a product people want, ready-to-go business processes, a recognised brand, back and front-office functions for compliance, access to national and local marketing, and innovation,” says Nick Neil (left), CEO of Ewemove, TFPG’s hybrid brand.
“Add to this, an entrepreneurial, skilled and experienced salesperson, or estate agent, and you’re ready to take off like a rocket heading for the moon, rather than a cheap disappointing firework that quickly runs out of thrust, which is often the case if an individual tries to do everything by themselves.
“The franchisee wants to back themselves, take a longer-term view and work hard to build an asset base they can monetize at some stage in the future.”