Persimmon cautions over Budget cost hit as home sales fall
The building giant said home sales fell between July and November, to 1,416 from 1,439 a year ago.
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Your support makes all the difference.Housebuilder Persimmon has said costs will be sent higher by recent Budget measures as it also cautioned over rising build inflation for the year ahead.
The Charles Church builder said that it was still assessing the full implications of the Budget, which saw Chancellor Rachel Reeves increase national insurance contributions for employers among a raft of other measures.
But it flagged concerns over rising cost pressures for the business, while it added that home sales fell between July and November, to 1,416 from 1,439 a year ago.
We are seeing some signs of build cost inflation beginning to emerge in price negotiations for 2025 and are working closely with our supply chain to manage our costs
Homes through its partnership business dropped to 149 from 205 a year earlier, but private home sales increased 3% to 1,267.
Shares fell 5% in morning trading on Wednesday.
It said: “We are seeing some signs of build cost inflation beginning to emerge in price negotiations for 2025 and are working closely with our supply chain to manage our costs, which will also be impacted by new building regulations and the employer national insurance increases announced in the recent Budget.
“We are seeking to mitigate the impact of these cost increases through robust commercial controls and other management actions.”
But Persimmon said it was on track with its full year completion target for around 10,500 homes and said the August interest rate cut continued to buoy buyer demand.
Persimmon said: “Demand for our homes has continued into the autumn selling season, helped by improvements in customer sentiment as interest rates begin to reduce and affordability improves.”