BDEV say Northern and Central markets are performing well, but confirmed London is softening
Companies: Barratt Redrow plc, Persimmon Plc
UK housebuilder Barratt Developments has said that despite uncertainty around the EU referendum, its performance in the previous quarter had been healthy, with the group trading positively, and market conditions remaining healthy and robust.
The FTSE 100 company said consumer demand had, in general, been robust, driven by an undersupply of homes combined with good mortgage availability and supportive government policies like Help to Buy.
Performance across the UK was mixed, with Northern and Central regions performing much better than last year, but the London market softening, a similar sentiment to that expressed by Persimmon in its most recent trading update.
"Market conditions in London at higher selling prices remain more challenging. To mitigate these risks we have taken pricing action on a number of our sites in London. Further actions to de-risk London delivery include an exchanged build and sale agreement on a bespoke development of 39 apartments for a total value of £47m."
Barratt launched 69 developments during the period, with 385 sites currently in operation. The company said site visits were down 4.1% on last year, contrasting Persimmon who reported site visits "well ahead of last year".
David Thomas, Chief Executive of Barratt said it had been another good trading period, and welcomed the strong consumer demand and mortgage availability:
"We are mindful of the potential for economic uncertainty created by the outcome of the EU Referendum. However, market fundamentals are robust, and we remain a housebuilder of choice.
Barratt's commitment to quality design, build and excellence in market-leading customer service has supported our strong sales performance. Our focus remains on maintaining good operational and financial performance, and delivering attractive shareholder returns."
