(Reuters) – UK homebuilders Bellway and Redrow on Thursday flagged persistent market challenges despite a slight pickup in activity in recent weeks, as a surge in loan costs and broader inflationary pressures drive buyers away.
Rising interest rates and an ill-fated mini-budget in September have pushed the British housing sector into a marked slowdown amid uncertainties over the wider economy.
Bellway, which constructs everything from one-bedroom apartments to six-bedroom family homes and luxury penthouses, said it would build fewer homes this fiscal year than the last, despite a record output in the first half to Jan. 31.
The company’s half-year bookings rate fell 31.7%, while the current order book declined about one-third to 1.39 billion pounds ($1.68 billion).
Redrow, meanwhile, withdrew its outlook for the next fiscal year, citing recent changes in market conditions, after posting a 2% decline in profit for the six months to Jan. 1, 2023.
Both the FTSE MidCap firms echoed larger rival Barratt, which on Wednesday highlighted a modest improvement in market activity in the new calendar year.
($1 = 0.8265 pounds)
(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Subhranshu Sahu)
