Housebuilder says booming demand mitigating increasing cost of building homes
Persimmon has shrugged off rising costs as turnover increased by more than half in the first six months of the year.
In a trading update this morning, the housebuilder said revenue will be £1.84bn when it releases its interim results for the half year to 30 June next month, a 54% hike on the £1.2bn it reported for the same period last year when sales were hit by the covid-19 pandemic.
The number is also up on the £1.75bn it filed for the first six months of 2019 – before the pandemic struck.
It added that increased costs on the supply chain because of materials shortages and Brexit were being nullified by booming demand which pushed its average selling price up 4.9% to £236,200 during the period.
“Currently this house price growth is mitigating the effect of the upwards pressure being experienced on the industry’s cost base,” the firm added.
But it warned that uncertainties regarding the UK’s future economic prospects, including unemployment levels, which are expected to creep up once the furlough scheme finishes at the end of September, could put the brakes on consumer confidence.
The group recorded 7,406 legal completions in the six-month period, up from the 4,900 reported for the same period in 2020. It spent around £200m on land, bringing 10,000 new plots into ownership across 48 locations.
Forward sales stood at £1.82bn, slightly down on the £1.86bn reported last year.