Top estate agent sees recovery

THE housing market is rallying, Countrywide Assured said today, following a sharp drop in second-quarter transactions that helped slash its interim profits by 39%.

The country's largest estate agent said it was in line for a record £63.4m in commission on sales awaiting exchange.

But it is taking longer to complete deals. Fees also have been swollen by higher house prices. The average selling price through Countrywide was £142,700 in the first six months, 15% more than a year earlier. That cost sellers £2,500 in commission, up 14%.

Like most estate agents Countrywide has suffered a setback in transactions, down 16% at 37,272 homes sold.

Chairman Christoper Sporborg said confidence was hit by the war in Iraq. The slowdown was most severe in London and the South-East 'with the most expensive properties in those areas the worst affected'.

Pre-tax profits fell to £21.9m from £35.7m a year earlier. The interim dividend is increased 5% to 2.15p.

Central Statistics Office figures show a 15% fall in home sales in the first half, dropping 25% in the three months ended June.

Despite this, Countrywide raised the number of mortgages it arranged by 8% to 24,647. Its department dealing with valuations and surveys reported a 13% increase in assignments to 303,836.

Countrywide's life policies division lost £2.5m due to mis-selling claims and policy lapses. It plans to make a further £2.7m provision for mis-selling claims.