If you’re a landlord in the UK at the moment, chances are the letting agency managing your property has changes hands over the past year.
Because the Covid pandemic has prompted one of the most extraordinary outbreaks of merger and acquisition activity within the property industry seen in living memory.
The most recent this morning is the purchase by London estate agency Foxtons of its rival Douglas & Gordon for £14.25m, which followed the acquisition of Home Counties agency Gibbs Gillespie yesterday.
The biggest of all, which is due to complete later this month, is the takeover of property industry behemoth Countrywide and its 60 estate agency brands by rival Connells for £134 million following years of financial problems for Countrywide.
Other significant deals include the takeover of Hunters by TPFG, the parent company of Martin & Co a few weeks ago, as well as the ongoing buying spree of northern agency Linley & Simpson, which recently bought its rival Dacre Son & Hartley.
And these are just the big names – a flurry of smaller takeover deals has also been under way between local and regional estate agencies too.
But almost all of these deals are about lettings. Following the Tenant Fees Act two years ago, the profit margins of lettings agents have been severely reduced and increasingly the only viable way to run such a business is to amass a large portfolio of rental properties and leverage – as business gurus like to say – their economies of scale, while also putting up their fees to landlords.