Vistry lifts profit outlook and build target on demand for affordable homes
British housebuilder Vistry is on track to build close to 2,000 more homes than what it built last year, as it bucks industry trends off the back of affordable homes.
In an update on Thursday, the business formerly known as Bovis Homes, said it plans to complete 18,000 new homes this year, 500 ahead of previous expectations and a steady rise on the 16,118 completed the year before.
Last October, the FTSE 250 firm said it would focus solely on building affordable homes via its Partnerships business. This partners with local authorities and other social housing providers after a volatile housing market eroded demand for building in the private sector.
The company said it predicts half year and full year profit to be ahead of last year and “remains confident” in achieving £800m operating profit in the medium term.
Vistry is also currently in the process of completing a £100m share buyback following a £55m buyback programme launched in September.
Greg Fitzgerald, chief executive said: “The group has had a good start to the year with our unique Partnerships model clearly demonstrating its market resilience.
“Working closely with our partners, we are seeing good demand in the Partner Funded market and accompanied by an improving trend for our open market sales, are on track to deliver more than 10 per cent growth in completions in FY24, with half year and full year profit expected to be ahead of last year.
He added: “This is underpinned by our strong forward sales position totalling £4.9bn, up 10 per cent on the same position last year. We remain confident in our differentiated strategy and are making good progress towards our medium-term targets.”
It comes as sentiment in the housing market has shown signs of improvement this year, despite mortgage rates increasing and the central bank continuing to hold interest rates.
Earlier this year the CMA launched a probe into Vistry and a number of its peers following concerns about competition in the housebuilding sector and the country’s inability to meet rising demand for new homes.
The Competition Market Authority (CMA) said the year-long study identified a number of issues with the market, including complex planning regulations holding back housebuilding, poor quality of homes constructed and high estate management charges.