Housebuilder Barratt Developments said demand for new-build houses has fallen due to economic uncertainty and a rise in mortgage rates.
The company said net private reservations fell from a weekly average of 281 a year ago to 188 in the period from 1 July to 9 October. In a trading update issued today (12 October), the company said it is expecting pre-tax profit of £972.5m in 2022, down from £1.05bn last year.
Barratt expects its construction pipeline to grow to 367 homes completed per week, up from 335 in the same period a year ago. The market is tackling build cost inflation that has now hit 10%.
David Thomas, chief executive, said: “We continue to see strong levels of interest across the country; however, private reservations remain below the level seen in FY22 as customers react to the wider economic uncertainty.
“While the outlook for the year is less certain, we remain on track to deliver adjusted profit before tax for the year in line with current consensus, and we are focused on maintaining our commitment to lead the industry in the quality, energy efficiency, and sustainability of our homes and in our customer service, all of which are fundamental to our ongoing success amid a more challenging market backdrop.”
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