Barratt Redrow reveals ‘softer’ reservations amid affordability pressures

Barratt Redrow said it has seen “softer” private home reservations in recent months as affordability pressures weigh on potential homebuyers.

Britain’s biggest housebuilder said home completions also dipped over the first four months of the financial year.

Boss Dean Banks said: “Our trading performance in the first 17 weeks of the financial year has been resilient against a backdrop of challenging market conditions, with continued pressure on affordability.

“While the underlying private reservation rate has been softer, we have seen stronger demand from the private rental sector.”

The company reported that its underlying private reservation rate declined to 0.53 for the 17 weeks to October 25, compared with 0.57 for the same period a year earlier.

Meanwhile, the total reservation rate improved slightly to 0.59 from 0.57 from a year earlier.

Barratt Redrow also revealed home completions of 3,223 for the 17-week-period, falling from 3,665 over the same period last year.

The group also reported that its order book grew to £3.32 billion, up from £3.28 billion a year earlier.

The update comes after an autumn Budget which saw the Government announce a new First Time Buyer ISA and Your First Home scheme, aimed at helping people get on the property ladder.

Mr Banks said: “We welcome the Government’s ‘Your First Home’ scheme and its support for first-time buyers.

“Alongside planning reform, the scheme has the potential, over time, to support increased housing delivery.”

Chris Beauchamp, chief market analyst at IG, said: “Traders are focusing on the improvement in Barratt’s order book, even if it is relatively slight.

“But it is sufficient to overcome the negative performance in recent months.”