Trading update points to downturn in reservations and visitors since the Northern Rock crisis, but construction division is up
Kier has warned of a slowdown in its homes division because of "uncertainties" in the mortgage lending market.
In a trading update covering the period from 1 July to date, Kier said its reservations to the end of September were fewer than the same period last year. It said also that its sites experienced a "notable" downturn of visitors after the Northern Rock crisis, and the market continues to be unsteady because of negative buyer sentiment.
The statement said: “Homes and property markets are both subject to sentiment and the appetite of lenders both of which are erring on the side of caution.”
However, Kier added that its order book remained strong with more than 50% of full year targeted unit sales already secured in completions, exchanged contracts and reservations. It expects to meet its targeted unit sales for the year.
Business elsewhere in the business is buoyant, with the construction division reporting a record level of revenue in the first quarter. Kier also continues to grow its support services division, with the recent win of a £400m home repairs and maintenance contract with Stoke-on-Trent council boosting its standing in the sector.