Berkeley Group said cautious buyers and a weaker economic backdrop continued to weigh on the housing market, but that it remained on track with its four-year profit plan.
It’s a familiar story for housebuilding investors and one that underscores the near-term uncertainty in the UK property market.
The London-focused housebuilder said sentiment had been dented further since the start of its financial year by the ongoing conflict in the Middle East and political uncertainty in the UK.
While enquiries were good and stable, it said customers without an immediate need to move remained more hesitant to commit, and that some buyers might defer purchases until after the government’s Budget at the end of October.
Against that backdrop, Berkeley reiterated that it was operating within its four-year plan to deliver £1.4bn of pre-tax profit, with earnings expected to be broadly even across the period and slightly weighted to the first half of the current year.
In April it had announced plans to cut production by around a quarter over four years, prioritising cash generation over short-term profit.
Berkeley also renewed its call for stamp duty reform, urging the government to cap the tax at 1% for first-time buyers and downsizers and scrap a surcharge on investors, arguing that the current regime was choking housing transactions and, in turn, supply.
It seems Berkeley Group’s fortunes, like all FTSE 100 housebuilders, rest with the UK government.