Sluggish housing market hits homebuilder Redrow
Redrow stuck by its guidance on Friday but warned that the results will be towards the lower end of the range it had previously given as the market was “subdued” this autumn.
The housebuilder said the level of net private reservations had fallen by a quarter to £384 million in the 18 weeks to the start of November.
The company added that at every site it runs the number of people reserving a home fell from 0.63 per week to 0.49.“Following the usual summer slowdown we reported in our 2023 results announcement, the housing market has remained subdued through the autumn,” said chairman Richard Akers.
“The business has had to adapt to this more difficult trading environment in terms of build rate and operating costs.
“However, we continue with our strategy of delivering our high quality, award winning Heritage homes to our target customers.“
Redrow previously said that it expected revenue to fall between £1.65 and £1.70 billion and profit before tax between £180-200 million for the year. It said the results will still be within these ranges.
“However, with the lower than anticipated sales rate due to the more subdued autumn housing market they are more likely to be towards the lower end of the range,” the business said.
Shares had dropped around 5.3% on Friday afternoon following the announcement.It said that the rises in costs that it has seen over recent years have continued to abate but the business still expects inflation at around 7% in the current financial year.