Business Quarter Magazine: LSL growth marks improving house market
Fri 17 May 2013
Residential property services provider LSL Group has reported signs of a pick-up in the housing market since Easter. The Newcastle-based group, which owns Your Move and Reeds Rains chains and employs about 4,750 people nationwide, also revealed, in an interim management statement, steady underlying revenue levels in the four months to April 30, after allowing for the end of the Stamp Duty holiday in March 2012.
In the six months to June 30 2012, LSL had revenues of 120.7m. LSL Group CEO, Simon Embley said: "Activity levels were constrained in line with the market during the first quarter but have since picked up considerably with underlying group revenue in the post Easter period up 7%year on year. The group is well positioned to benefit from its significant operational gearing if market volumes continue to improve." A spokesman added: Since Easter there has been a strong uptick in activity and we at the point where management are hopeful that recovery will be sustained, but its still early days.
The company had planned for a flat market in 2013 and to accelerate investment to increase market share in estate agency as well as increase the rate of new branch openings in Marsh & Parsons, the London agency it bought for 50m in November 2011. Now management plans further investment in surveying and estate agency to build capacity as the market improves.
Surveying fees fell by 21% in the period due to the loss of a major contract last year. In its statement the group said: Recent increases in activity levels in LSL's businesses indicate that market transaction volumes are improving. These tentative signs of recovery are supported by key lender activity and renewed consumer confidence. In addition, a further boost is expected from the Help to Buy Mortgage Guarantee
Scheme in January 2014.
Overall, the Board is cautiously optimistic that the recent increase in front-end activity levels will result in a sustained improvement in market volumes from the second quarter of 2