Redrow warns of slowdown as housing boom spurred by Help-to-Buy fades away

Kasmira Jefford
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The market is returning to a more normal level of activity
HOUSEBUILDER Redrow warned yesterday it has seen a drop in sales over the summer as the effects of the government’s Help-to-Buy scheme began to wear off.

Chairman Steve Morgan said the demand for new homes generated by the launch of the equity loan scheme in 2013 reverted to “a more normal level of activity” in the summer.

This fall in sales, combined with a lack of availability on many of its sites, produced a sales rate per outlet per week for its regional businesses of 0.65 compared to the “abnormally high” rate of 0.87 in the summer of 2013, Morgan said at the group’s annual general meeting yesterday.

He added that in London, Redrow developments were almost fully sold out and therefore year-to-date private reservations were 22 compared with 86 last year.

His comments came after rival housebuilders Bovis Homes and Galliford also said last week that the market was returning to more normal levels. In the past 10 weeks, Redrow said it had experienced “a traditional autumn market” and the sales rate, excluding London, was 0.68, in line with last year.

Its private order book is up 10 per cent year-on-year at £465m, with the regional order book up 25 per cent.