Financial woes hit housebuilding sector as construction slows

Housebuilders are suffering a downturn after Barratt issued a trading warning for the next few months.

Barratt Developments said the outlook was “uncertain”, and held back from a full-year profit forecast in an update ahead of its annual meeting,

The company’s shares lost 13½p, or 3.1 per cent, and there was a knock-on effect on other building firms, The Times reports.

Shares fall

Taylor Wimpey shares fell 2.8 per cent and Berkeley Group dropped 1.6 per cent. Persimmon and Bellway lost 4.4 per cent and 3.9 per cent respectively.

There was an overall effect of the developers’ woes on the FTSE 100, which dropped 35.87 points, or 0.5 per cent, as investors also considered new inflation figures and the possible escalation of the war in the Middle East.

Failed

The Government has failed to meet its own new homes target of 300,000 per year, and it was abandoned by housing secretary Michael Gove under pressure from Tory colleagues.

Labour leader Sir Keir Starmer has promised to deliver 1.5 million new homes. He told the party’s conference last week that a Labour Government would launch a major push to remove barriers to building.

Questioned

In Scotland, property industry leaders are challenging the ruling Scottish National Party to explain how it will deliver its house building plans.

Propertymark welcomed a promise to build 110,000 affordable homes by 2032, but questioned how the SNP intends to deliver on this pledge.