- Barratt Redrow completions dip as housebuilder urges demand-side reform
- Pressure on Labour’s ambitious target of 1.5m new homes this parliament
The Government must boost support for first-time home buyers or it will fail to fix the housing crisis and risk ‘accelerating’ UK inequality, Britain’s biggest housebuilder has warned.
Barratt Redrow told investors on Wednesday ‘affordability, uncertainty in the macroeconomic environment and weak consumer confidence remain challenges’ despite falling mortgage rates and the Government’s supply side reforms.
The FTSE 100 group welcomed Labour’s 10-year £39billion Affordable Homes Programme, announced in the spending review earlier this year, but said demand-side support is needed for ‘rapid and sustained private development growth’.
It follows comments on Tuesday from smaller rival MJ Gleeson, which said ‘more needs to be done’ on planning rules to ensure the Government can hit its ambitious new home targets.
Higher build costs, a slower-than-expected recovery in housing demand and ongoing planning system blockages have contributed to a more challenging year than many housebuilders might have expected.
As a result, the rate of home completions across the market has severely lagged the required pace if the Government is to meet its ambition of building 1.5 million new homes this parliament – or 300,000 per year.
Barratt Redrow told investors on Wednesday ‘affordability, uncertainty in the macroeconomic environment and weak consumer confidence remain challenges’
Industry giant Barratt Redrow reported just 16,565 total home completions, including joint ventures for the 12 months to the end of June. It had been aiming for 16,800 to 17,200 completions
In the prior year, when Barratt Developments and Redrow were two separate businesses, they built 17,972 new homes in aggregate.
The combined group, which merged after Barratt bought Redrow in a £2.5 billion deal last October, has a target of building 22,000 homes per year over the medium term.
Barratt Redrow boss David Thomas said on Wednesday: ‘It is vital that Government policy is focused on reforming the planning system, removing barriers to investment and supporting purchasers, particularly first-time buyers, if the sector is to build the homes the country needs.’
It came as the group reported an underlying pre-tax profit of £488.3milliom, soaring 26.9 per cent on the same time last year as revenues jumped 33.8 per cent to £5.58billion.
Barratt Redrow said: ‘To drive rapid and sustained private development growth across the housebuilding industry, Government should consider demand-side support for first-time buyers, a feature of the housing market for many decades.
‘Looking to the future, the absence of first-time buyer support risks the acceleration of ever-increasing inter-generational and social inequality, where parental savings and financial support will increasingly dictate the ability of so many to access the stability and security of home ownership.
‘It is vital that Government remains committed to tackling our housing crisis, supporting the industry to build the homes the country needs and focused on creating an environment which encourages the sustained investment in the land, people and materials to do so.’
Barratt Redrow shares were up 1.3 per cent in early trading to 371p.
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This article was originally published by a www.dailymail.co.uk . Read the Original article here. .