The housing market enjoyed a strong rebound during July, Purplebricks Group PLC (LON:PURP) and M Winkworth Plc (LON:WINK) both reported on Monday.
Estate agent Winkworth said its office network saw a 64% week-on-week increase in sales applicants registering on the day after the easing of the stamp duty threshold, with website activity at its “highest ever level”.
Since July 8, new house sale instructions have risen 17% year on year and 13% compared to early June, while viewing numbers were up 14% and 22%, respectively.
READ: Purplebricks forecasts full-year revenues ‘below expectations’ as coronavirus rattles housing market
Meanwhile, Purplebricks said it continued to see new instructions through the pandemic and that the market has been “recovering well” since mid-May, with July seeing the “highest ever month” for UK instructions, with more than 7,000 homes listed in July.
“The group is encouraged by the early signs of the housing market rebounding well following the lifting of the lockdown and the government's stamp duty holiday,” Purplebricks said alongside its results for the year to end-April.
Revenue for Purplebricks of £111.1mln was down 2% on the prior year as it shifted its focus back on the UK and exited the US and Australia, while a £9.4mln operating loss compared to a £1.5mln loss last time.
Underlying profit (EBITDA) declined 53% to £4.8mln, reflecting the loss of two months trading at the back-end of the year and the investments made in people and technology.
“Despite the challenges of COVID-19, our strategic initiatives are being delivered at pace to accelerate our digital and data capabilities, and with a very healthy net cash balance of £66m, I'm confident that we can take advantage of the changing landscape,” said chief executive Vic Darvey.
Back at Winkworth, the company welcomed the significant rise in activity but said it was “too early to predict to what extent this will translate into completed sales and how sustained this increased activity level will be across the network”.
“Accordingly, and although encouraging, it is not yet possible to predict the extent of any impact on Winkworth's financial performance.”
Shares in Winkworth were down 6% to 132p in early trading on Monday, while Purplebricks jumped 12% to 52p.
Helping the latter, house broker Peel Hunt upgraded its rating to 'buy' from 'add' after completing the overseas exits and looking “well placed to focus solely on its most profitable and mature market, the UK”.
“As the UK’s most tech-enabled estate agent, Purplebricks should benefit from the accelerating adoption of digital and technology-led estate agency services that we see coming as a result of the pandemic,” analysts added.
They updated their forecast numbers for the first time since Covid-19 and the Canadian disposal, with EBITDA of £3.2mln pencilled in for the coming year, rising to £8.68mln for the year after.