Barratt Developments has said that it is confident in meeting targets for the year after steady demand over the past quarter.
Between 1 July and 10 October the group delivered 27 new developments and 281 net private reservations per week.
“This is particularly encouraging given the significant year on year reduction in Help to Buy reservations and the ending of the stamp duty holiday,” commented chief executive David Thomas.
“We continue to work closely with our suppliers and sub-contractors and have not experienced any significant disruption to our build programme as a result of the challenging supply chain environment.”
In a statement, Barratt said “The group is in a very good position. We have both a substantial net cash balance and strong forward sales, as well as an excellent land bank and a continued focus on delivering operational improvements across our business, alongside our ongoing commitment to deliver high quality, sustainable homes across the country.”
Laura Hoy, Equity Analyst at Hargreaves Lansdown, commented: “The housebuilders have found themselves in somewhat of a sweet spot. While pent-up lockdown demand is starting to wane, people are still motivated to move and that’s driven house prices higher. According to Barratt, that’s been enough to offset build cost inflation, and the group’s not expecting to deliver any downside surprises this year.”
Analysts also pointed to Barratt largely shacking off the impact of the end of stamp duty holidays and changes to Help to Buy.
“Shareholders in housebuilders have been looking on nervously, as the stamp duty land tax break has ended and the rules for Help to Buy continued to change but Barratt’s trading statement offers welcome reassurance,” said AJ Bell Investment Director Russ Mould.
“The net reservations rate in its new financial year may have dipped slightly compared to 2020 but it has exceeded the level seen at this stage in 2019 by 18%, even though Help to Buy has represented only a fifth of house purchases compared to more than half in the first three months of the last financial year (and just under 40% for the year as a whole).