Persimmon says it's too early to judge what the effect of the EU referendum on housebuilding will be

James Nickerson
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UK's Biggest Housebuilder Postpones Start On New Homes As Sales Slump
Persimmon's share price dropped substantially in the wake of the referendum (Source: Getty)

Ahead of its half year results, Persimmon said that trading through the first half of the year has been strong, but drew attention to uncertainty relating to the EU referendum.

The figures

Persimmon said that its legal completion volumes were increased by six per cent to 7,238 new homes for the six months to the 30 June.

The average selling price of those were £205,500.

Group revenues were £1.49bn, up 12 per cent from 2015.

Why it's interesting

The biggest UK housebuilder by volume said that while their fundamentals remain strong, it is too early to judge what the impact of the Brexit vote will have on the market.

"It remains too soon to judge the effect that the result of the EU Referendum will have on the UK new homes market. We believe that market fundamentals remain strong, supported by long term unfulfilled demand, and that the UK housing market will continue to provide good opportunities for those companies with the right strategic focus and the balance sheet strength to navigate future changes in trading conditions," the company said.

Read more: Housebuilders' share prices drop after "dire" construction data released

The company's shares plummeted by nearly a third after the referendum.

Still, low borrowing costs and healthy labour market conditions continued to support consumer confidence through the first half of the year, Persimmon said.

Read more: Housebuilding shares are being hammered by Brexit

Approvals remained ahead of last year for the April/May period despite a period of increasing uncertainty leading up to the referendum.

It also looks like the government has more to do. Persimmon continues to experience delays to the start of construction on new development sites due to local inefficiencies in the planning system and "despite the welcome improvements that continue to be made to planning processes by the government".

What Persimmon said

The company said:

We remain confident in the Group's prospects based upon our long term strategy, the hard work and dedication of all our team, the Group's excellent forward orders, strong land bank and robust financial position.

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