Completions to fall at Barratt amid flurry of updates from housebuilders

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Andrew Feinberg

White House Correspondent

Barratt Developments is expected to report a fall in home completions, but profits just ahead of previous expectations, amid a week of financial updates from UK housebuilders.

The company, which is Britain’s biggest housebuilder, reports its annual results on Wednesday September 4, with updates from Vistry and Berkeley Group in the following days.

Barratt said in July that home completions fell to 14,004 in the year to June 30, and that home completions are set to fall to between 13,000 and 13,500 in 2024-25.

The projected fall comes despite respite from soaring building costs and Labour’s pledge to cut planning red tape.

Chancellor Rachel Reeves has said the Government will restore mandatory housebuilding targets for local authorities as part of the drive to build 1.5 million homes over five years, which is expected to help builders.

But Prime Minister Sir Keir Starmer warned earlier this week that the Government’s forthcoming Budget will be “painful”, sending housebuilder shares down.

He said “things are worse than we ever imagined” because of a £22 billion “black hole” in the public finances, and said he found out in recent weeks that the Tories had borrowed almost £5 billion more than the Office for Budget Responsibility expected.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “While Barratt Development’s foundations look solid, there are niggles of worry about the trajectory for the housing market.

“Reservation rates and buyer sentiment appear to be improving, and there is fresh hope that the issues tying housebuilders’ hands can be unwound with reform of the current planning rules looking key to an uplift in activity.

“However, the latest downbeat assessment of the UK’s finances by the new Government sent a wobble through housebuilding stocks amid concerns that it could prompt fresh wariness among buyers.

“Already fewer homes being sold, and at reduced prices, have meant less cash coming in the door. And incentives used to boost sales have also weighed on margins. A further easing of mortgage rates will be needed if activity is to pick up significantly.”

Meanwhile, on September 5, Vistry will report its half-year results, when analysts expect underlying operating profit to rise around 10% to £227 million, helped by increased sales volumes and lower building material costs.

And Berkeley Group will to update investors on September 6, when analysts expect an update on whether previous guidance of £525 million pre-tax profit for the coming year is on track.