Winkworth profits dropped by just over a quarter last year “in a difficult market”.

The franchising group said pre-tax profits of £1.42m were down 25.6% on the previous year, with franchisee turnover down 6% to stand at £46.1m.

It also reported that rental income now accounts for 44% of total revenues.

Winkworth said the Stamp Duty changes in the 2014 Autumn Statement “continue to weigh on prices valued in excess of £1m”.

In geographic terms, the best performing markets were in suburban areas and provincial towns “where higher Stamp Duty was less of an impediment”.

The company said total contribution to group turnover from offices outside London rose from 19% in 2015 to 21% last year.

The company added: “This vindicates our strategy of expansion outside of London since 2008.”

In 2016, two new offices were opened, while four existing franchise businesses were sold to new management, giving a year-end total of 94 outlets.

With a further new office in Cheltenham, and the conversion of an existing estate agency in Kingsbury, north-west London, Winkworth anticipates between six and eight new openings this year.

Winkworth said it is expecting a flat market this year – but says this benefits its franchising model.

It said: “We are in regular conversation with existing agencies to explore how we can help them grow market share in a slow market, and with entrepreneurs looking to start up businesses with the support of a strong brand.

“In particular, we see an opportunity to convert lettings and management businesses in provincial markets to Winkworth.

“By joining us we can not only support their existing business but also offer them a sales operation, more than offsetting the loss of tenancy administration fees in 2018, which in the case of some independent specialist lettings agencies we estimate could account for up to 30% of their revenue.

“With an average Winkworth franchised office posting a 56/44 balance between sales and rental income, we can help talented operators to more than replace this revenue loss.”