Barratt delivers ‘modest’ upgrade amid booming housing market

Housebuilder Barratt Developments has “modestly” hiked its outlook for the full year after a strong start to 2021 thanks to Britain’s booming property market.

The group said it is set to complete more homes this year than first predicted, at between 16,000 and 16,250, with a further 650 joint venture completions.

It comes after the housing market roared ahead in recent months due largely to the stamp duty holiday, which was extended to the end of June, as well as changing demand due to the pandemic.

UK house prices hit a new record of £238,831 in April after rising 2.1% since March in the biggest monthly increase since 2004, according to figures last week from Nationwide Building Society.

Barratt said weekly average net private reservations per active outlet stood at 0.83 since the start of 2021, up from 0.79 a year earlier, with forward sales of £3.7 billion against £2.8 billion a year ago.

The group announced it would repay around £3.5 million of business rates relief on its show homes and sales offices due to its strong trading.

It has already repaid £26 million of furlough cash in its first half.

Barratt said: “Reflecting both strong trading and our successful increase in construction activity, we now expect 2020-21 wholly owned completions to be between 16,000 and 16,250 homes and to deliver around 650 joint venture home completions.

“As a result, we now expect an out-turn for the full year modestly above the board’s previous expectations.”

Barratt revealed provisions of £163.1 million since 2017-18 for remedial cladding work on developments following the Grenfell Tower disaster, after another £4.1 million was put by in its second half so far.

It added that £85.6 million remains unspent.

In February, Barratt resumed shareholder dividend payouts as it announced interim pre-tax profits rising 1.7% to £430.2 million on a 10% jump in revenues.

It completed a record 9,077 homes over the six months to December 31, a jump of 9.2% from the last six months of 2019 and the highest ever for its half-year.