Countrywide blames slump on Iraq war

14 August 2003
The UK's largest estate agents firm, Countrywide Assured, announced a 39 per cent fall in its pre-tax profits.

The company, which owns the Bairstow Eves chain of estate agents and the Rightmove property website, blamed the conflict in Iraq and the shortage of first-time buyers for poor performance.

During the six months to the end of June 2003, the group's pre-tax profits fell from £35.8 million to £21.9 million, which was due to a 'sharp downturn' in the number of housing transactions.

The group saw a 16 per cent fall in the number of homes it sold during the period.

Countrywide Assured stated that it was beginning to see a return in consumer confidence and claimed buyers have simply delayed their purchases.

The company has seen a record pipeline of £63 million of commission on sales awaiting exchange as the company enters the second half of the year.

Christopher Sporborg, Chairman, stated, "Countrywide Assured Group produced creditable results for the first half of 2003 given the sharp reduction in the number of housing transactions which took place in the UK as the market paused during the Iraq crisis.

"However, it now appears that many of these transactions were simply delayed and we enter the second half of the year with a record pipeline of £63m of commission on sales awaiting exchange.

Mr Sporborg added that he expected conditions to improve over the rest of the year and claimed that housing market activity would pick up despite a possible moderating of average house price increases.

The company's financial services division, which offers mortgages and life policies, achieved a strong performance during the six month period. The division's operating profit increased 164 per cent to £8.7 million, this was due to an 8 per cent rise in the number of mortgages it arranged. The value of the mortgages it arranged increased by 24 per cent to £2.1 billion.