Housebuilders beat new home forecasts despite economic weakness
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The Government's housebuilding drive was handed a confidence boost on Tuesday after London-listed builders reported building more new homes than expected last year. Persimmon and Cairn Homes delivered bumper guidance-beating results for last year on the back of higher homebuilding volumes.
York-based Persimmon finished building 10,664 properties in 2024, a 7 per cent rise on the previous year and ahead of market forecasts. Growth was driven by private home completions climbing by 18 per cent to 9,075, offsetting a 30 per cent slump in new partnership houses.
The average selling price of a new home also rose by 5 per cent to around £268,500, which Persimmon said partly reflected 'improving market conditions'. Britain's housebuilding sector has experienced challenging times for over two years due to interest rate hikes and consumer weakness.
The Bank of England made fewer base rate cuts than initially expected last year, ultimately reducing just twice to 4.75 per cent, amid fears of an inflationary resurgence. Mortgage rates are falling to more affordable levels, though the best rates remain above 4 per cent for the time being.
This has stimulated a recovery in residential prices and transactions. Growth: Persimmon built 10,664 properties in 2024, a 7 per cent rise on the previous year. As a result, Persimmon's current forward order book stands at £1.15billion, an 8 per cent year-on-year increase.
