Two of Britain’s largest and best known estate agencies have endured a day of turmoil at the hands of investors - prompting question marks over the future of both firms.
Countrywide suffered yet another double-digit percentage share price drop on the London Stock Exchange, with the 10.63 per cent fall leaving the closing price at a mere 3.7p.
Investor chatrooms online have discussed how unusual it is for management not to make any official comment on the fortunes of a company that has seen such a significant share price reduction, not just in recent days but over a sustained period.
Investment consultancy Hargreaves Lansdown calculates that Countrywide has lost 26.73 per cent of its share value in the past week and 35.21 per cent in a month. Over a year it has lost 95.5 per cent and over five years, a remarkable 99.24 per cent has been lost.
The company now has a market capitalisation of only £60.61m; it is in the midst of a branch closure programme, details of which it is not making public.
Purplebricks, by contrast, ought to have had a good day yesterday judging from headline figures.
Its market share, as measured by property consultancy The Advisory, has risen very slightly; Estate Agent Today has been told that Purplebricks share of the online agency new listings for the past two weeks is 69.6 per cent, slightly up from a fortnight ago.
And in the same most recent two weeks, the top 10 online agencies have themselves taken 4.5 per cent of the total new listings - very slightly up on the 4.4 per cent of a fortnight ago.
However, any pleasure for Purplebricks is short lived as the future structure of the firm is now unclear following two developments late in the day yesterday.
Firstly the influence and fortune of key investor Neil Woodford are under the spotlight. Woodford yesterday evening blocked redemptions from one of his many funds after a large investor - Kent County Council - said it was going to withdraw its investment.
This has no direct bearing on Purplebricks, save for its link to the other piece of news to break yesterday - that is, that the German publishing company Axel Springer was in talks to possibly buy Woodford’s investment in the agency, as part of a take-over deal.
The industry publication Property Week says Woodford “is understood to be a willing seller” following poor returns on his flagship equity income fund.
All of this came after news that Purplebricks’ founders - Michael and Kenneth Bruce, along with Michael’s wife Isabel - had sold their final shares to Axel Springer yesterday; however, Springer’s stake in the company is still slightly less than Woodford’s, hence the need for talks to ensure a takeover can proceed.
Purplebricks’ shares yesterday rose around 10 per cent on hearing of the Axel Springer investment before easing back to close 2.3 per cent higher on the day at 106.4p.
Like Countrywide, Purplebricks market capitalisation is a shadow of its former self; Hargreaves Lansdown calculates it’s lost 22 per cent of its value in the past month and 74.68 per cent of its value over the past two years.