Countrywide upgrades profits forecast - just months after a profits warning

The UK’s largest estate agency group has upgraded its profits forecast to the City - just over 10 weeks after issuing a profits warning.

Countrywide shares dropped sharply in early November after it warned at the time: “Despite generally encouraging economic conditions, the anticipated post-election recovery in residential transactions failed to materialise in any significant way.”

But now it appears the market, and Countrywide’s fortunes, are doing better than expected. 

In a pre-close trading update this morning it says the fourth quarter of 2015 had been “encouraging” after all, despite uncertainty over buy to let purchases in the light of the unexpected additional homes stamp duty proposed by Chancellor George Osborne.

The group’s mortgage business appears to have been particularly successful, and backs up other news this morning that residential mortgages are relatively buoyant.

Today’s statement by Countrywide, which is undergoing a substantial restructuring, says of this year:

“It is too early to predict what the trend in residential transactions will show in 2016 although approved mortgage volumes including owner occupiers ... in recent months have been ahead of the previous year, which is a positive indicator. Both our Retail and London business units enter 2016 with transaction pipelines ahead of the previous year. At this early stage we maintain our previous expectations for 2016.”