Demand in focus as UK homebuilders set to brief markets
World
Demand in focus as UK homebuilders set to brief markets
(Reuters) - Investors in British housing stocks will be eager to glean insights on demand and selling prices as some of the country's top homebuilders start issuing earnings reports or trading updates this month.
High mortgage rates and a prolonged cost-of-living squeeze have hammered UK housing demand over the past few months, making it the worst period for the industry since the 2008 global financial crisis, barring the lockdown-hit 2020.
Barratt (BDEV.L), the country's largest housebuilder and a sector bellwether, will report annual results on Wednesday and is expected to brief the market on the sales trend and average selling prices in the first eight weeks of fiscal 2024.
"Forward sales guidance will be watched closely given the tricky economic environment," Hargreaves equity analyst Matt Britzman wrote in a preview note.
"Investors will also be keen to see what's happening with average selling prices. They were being pushed higher by an increased proportion of London completions," Britzman said.
Berkeley (BKGH.L) will publish a trading update on Friday.
THE CONTEXT
Dwindling home-booking rates, tapering margins and uncertainty around interest rate hikes have forced housebuilders to slash profit forecasts and trim yearly housebuilding goals, amid desperate attempts to revive demand through a flurry of incentives.
British house prices in August were 5.3% lower than a year earlier, their biggest annual decline since July 2009, mortgage lender Nationwide said on Friday.
The number of house purchases in Britain this year is on course to drop by 21% to its lowest since 2012, property website Zoopla forecast on Wednesday.
Mid-cap builder Vistry (VTYV.L) will post half-yearly results on Sept. 11. Redrow (RDW.L) will report on Sept. 13.
