Home / News / UK’s Barratt benefits as housing market rises from COVID-19 lows

UK’s Barratt benefits as housing market rises from COVID-19 lows

Britain’s biggest housebuilder Barratt Developments raised its annual volume forecast on Friday and said it could resume dividend payments next month, after a rebound in demand from COVID-19 disruption drove a solid first-half performance.

Shares in the FTSE 100 company, which operates in England, Scotland and Wales, rose by as much as 5% in early trade, with rivals Persimmon and Taylor Wimpey also higher.

Britain’s housing market unexpectedly boomed in 2020 after the end of coronavirus restrictions in June, as people sought bigger houses better-suited to working from home, and to take advantage of a temporary reduction in purchase taxes.

Construction sites have been exempt from the latest nationwide lockdown that started this week to stem the spread of a highly contagious virus variant.

“Nevertheless, we are mindful of the continued economic uncertainties arising from COVID-19 and the UK’s new trading arrangement with the EU, together with the end of the stamp duty holiday and the changes to Help to Buy,” Barratt said.

Britain reached a post-Brexit trade deal with the European Union in December.

The owner of Barratt Homes, Barratt London and David Wilson Homes is targeting wholly-owned completions of 15,250 to 15,750 homes in its fiscal 2021, up from an earlier forecast of 14,500 and 15,000 homes.

The company said home completions, which rose 9% in the interim, would be lower in the second half of the year.

“With lockdown effects still prevalent in Barratt’s business early in H1, the growth in volumes is even more impressive,” said Davy Research analyst Colin Sheridan.

Barratt reported total forward sales of 13,588 homes for the period ended Dec. 31, up from 11,885 a year earlier.

Barratt, which has yet to give details of its dividend resumption, is set to join Persimmon, the second largest UK homebuilder, and Bellway in restarting the payment.

Last year, it cancelled an interim dividend of 9.8 pence per share, equating to around 100 million pounds and a special dividend of 175 million pounds for the full year 2020.

($1 = 0.7362 pounds)

About Catrin Jones

Avatar
Assistant Editor

Check Also

Government to pay £5,000 subsidy to boost heat pump take-up

Grants of £5,000 will be available  from next April to homeowners who wish to swap their …