Barratt Developments has assured investors that it is “on track” for the year despite revealing a decline in forward sales, however the group’s share price tumbled 0.32 per cent when markets opened.
In a trading update this morning the London-listed house builder noted that the economic outlook remained “difficult” as it posted total forward sales of £2.95bn in April 2023 down from £4.50bn in the same period last year.
As confidence in the housing market slowly recovers, Barratt Developments also revealed that it reduced the number of potential plots by 1,125 across six sites, compared to approvals of 4,761 plots on 27 sites in this period in 2022.
Despite this, Barratt said that its end of year balance sheet remained strong with the figure expected to be around £0.9bn in the stock market update.
Moreover, the group also said that a slower trading backdrop reduced the number of homes being built per week down from 359 last year compared to 303 this year.
Barratt ‘fully sold’ for 2023
Nonetheless, Barratt said it was positioned to deliver between 16,500 and 17,000 homes this year including some 750 joint venture home completions.
“Whilst 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,” David Thomas, head of Barratt said.
It comes as yesterday, figures by Nationwide revealed that the housing market is showing signs of a “tentative” recovery.
The figures showed that the annual rate of house price growth improved to -2.7 per cent from -3.1 per cent in March – as the recovery from September’s mini budget finally begins to get underway.