There are further signs that housing market conditions are improving after Barratt reported improvement in sales in recent weeks on Wednesday.
Britain’s largest housebuilder added to hopes that the market is recovering from the lows experienced at the end of last year, despite the fact that total forward sales in mid-April were still 29% down year on year.
In a trading update yesterday, Barratt said construction activity has been adjusted to the slower trading backdrop with 303 equivalent homes built per average week, 16% down on the 359 build rate achieved in the same period last year.
Reservation rates in the last 12 weeks have edged up to 0.71, compared with 0.93 the same time last year but are much improved from the January low of 0.3.
David Thomas, chief executive, commented: “In February we reported early signs of recovery in our reservation rates following the exceptionally challenging trading conditions experienced at the end of 2022.
“While the economic backdrop remains difficult, we are pleased that more positive sales rates have been maintained through this period and we are now fully forward sold for FY23.”
He said that build cost inflation would be around 9% to 10% for the year to the end June, but added Barratt expected to see this fall steeply in the year ahead to around 5%.
Reflecting the recovery in reservations, Barratt reaffirmed its home completions target of 16,500-17,000, after it raised the outlook range from 16,000-16,500 earlier this year.
