The Evening Standard reported seeing analysis from RBC Capital Markets around the expected levels of housebuilding this year from the bigger housebuilders.
It found that between them, these developers look set to sell almost 18,500 fewer homes in the current financial year, which represents a drop of more than a quarter.
Persimmon is pinpointed as the housebuilder likely to see the largest drop in completions, with a fall of 5,868 properties. In percentage terms, that’s a drop of 39.5 per cent.
Focusing on volume, Taylor Wimpey is forecast to see the next biggest drop, with 3,554 fewer sales, a 25.1 per cent decline.
Looking at percentage drops, the housebuilder set for the second largest fall is Bellway, which is on course to sell 3,427 fewer properties. That’s the equivalent of a 31.6 per cent decline.
Other builders set for significant drops in sale completions include Crest Nicholson (-26.8 per cent), Barratt (-21.5 per cent) and Redrow (-20 per cent).
Mini-budget ripples ongoing
Anthony Codling, head of housing research at RBC, said that the housebuilding sector was continuing to feel the impact of the mini-budget and the cost of living crisis, which had “sent shockwaves” through the sector, with the prospects for the market now “choppy”.
He also pointed to house price weakness, with the declines seen of late leading some to take a ‘wait and see’ approach to further building. Halifax recently reported that house prices had dropped for the sixth month in succession.
Codling added: “We expect the Bank of England to win the war on inflation and when they do, we believe that bank rate will start to fall, returning stability to the mortgage market. Meanwhile wages have been rising so as mortgage rates fall homebuyers’ mortgage capacity will increase.”
