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Barratt Developments shares rise on strong demand

Barratt Developments was one of the top risers on this morning’s FTSE 100 surge in post-lockdown demand.

The group upped its forecast of the number of houses it expects to sell this year thanks to the strong demand as people rush to complete sales before the stamp duty holiday ends.

Following the first lockdown, sales surged by 24% and since then have cooled but continue to be up 9.2% year on year.

“Based on current market conditions and site construction activity, we now expect wholly owned completions to be between 15,250 and 15,750 homes,” said Barratt, which in October had forecast between 14,500 and 15,000 completions,” said Barratt Developments in a statement.

“We have delivered an excellent first-half performance,” the company said. “During the first half we saw an increased sales rate as strong underlying demand was supplemented by pent-up demand from the initial national lockdown, the introduction of the stamp duty holiday and the March 2021 end of help to buy for existing homeowners.”

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Since Rishi Sunak introduced the stamp duty holiday over summer, the housing market has seen a boom.

“Given the ongoing mini-boom, prices might have been expected to rise again this month,” said Tim Bannister, Rightmove’s director of property data.

“But instead we have a slight dip, which could be a result of some new sellers pricing more realistically to have a better chance of agreeing a sale in time to benefit from the stamp duty savings on their onward purchase.”

Barratt Development shares rose over 4% at 717.20 (1015GMT).

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