Winkworth profits warning puts blame on high-end stamp duty

Higher stamp duty for the most expensive properties and the lack of a post-election bounce are being blamed for a profits warning being issued by respected franchise agency Winkworth.

Sales remain slow in the firm’s core London market and “a large part of the slowdown can be attributed to the stamp duty changes introduced in the latter part of 2014” the agency has said in a statement to the City. The same factor will be an influence next year, Winkworth warns, “undermining demand for more expensive properties.”

“It is expected that profits for 2015 will be slightly below market expectations. Our dividend is well covered, and with no debt and solid cash-flow we expect to be able to maintain our progressive pay-out policy" the company says.

"This will still be the second best ever year for Winkworth, despite transactions still being 26 per cent off their historic peak.”

However, Winkworth’s lettings operation has much stronger performance. “The private rental sector now represents 30 per cent of the London property market and we expect rentals to continue to grow in importance, with a shortage of supply underpinning prices” it says. 

The company says it has, in the past year, re-sold eight offices to introduce “new, higher-quality franchisees who we believe will help drive growth in both income per office and market share."