Foxtons shares tumble as estate agent takes £3m knock from Renters’ Rights Act

Foxtons shares have tumbled after the firm said it took a knock of as much as £3m from the introduction of the Renters’ Rights Act, amid a sharp uptick in tenancy terminations.

The Act abolished fixed tenancy terms and increased tenant flexibility to terminate tenancies, sparking “elevated levels of tenancy terminations.”

Foxtons, which also bemoaned a “prolonged downturn in the sales market” said operating profit for the first half of the year was £8.5m, a drop of nearly a third compared to 2025.

“The sales market is expected to remain subdued amid ongoing political uncertainty and a challenging macroeconomic backdrop,” the London-listed firm said.

Foxtons share price slid 27 per cent to 32p. The London estate agent’s stock has almost halved since the start of the year.

Foxtons said it made as much as £4.5m in cost savings to help soften the blow, including £1.5m from downsizing its head office and £3m from a cost reduction programme.

No-fault evictions

The new laws will ban so-called no-fault evictions, also known as section 21 evictions, which allowed landlords to serve notice on tenants ahead of the end of a fixed-term rental agreement.

Landlords will no longer be able to end tenancy agreements in this way, and will need to provide a legal reason – known as “grounds for possession” – to evict them. 

Landlords must also provide a notice period – usually four months – and then apply to the court to get their property back if the tenant refuses to move out. 

Labour housing minister Matthew Pennycook claims tenants had previously used section 21 to “arbitrarily” evict tenants who complain about faults with the property like damp and mould.

Fixed-term tenancies

The other major change being implemented by Labour is an end to fixed-term tenancy contracts. 

All tenancies will automatically become “rolling” after the law comes into force on Friday, meaning landlords cannot enforce a set end date to their tenancies. 

Tenants are in theory now allowed to stay as long as they like, and can give their landlords just two months’ notice if they want to move out.

Landlords will be banned from hiking rent more than once a year, and must give tenants at least two months’ notice of any increases.

The new law gives tenants the power to challenge any proposed rent increases that are above the current market rate. 

The legislation makes it easier for tenants to take landlords to a tribunal. The First Tier Tribunal (FTT) will not be allowed to suggest a higher rate than the one proposed by a landlord, and it will be given the power to defer rent hikes by two months in case of “hardship”.