Builders work on a new Barratt Homes housing development near Warrington, Britain, August 6, 2020. REUTERS
April 15 (Reuters) – Britain’s largest homebuilder Barratt Redrow slashed its annual land approval target on Wednesday as the company takes a more defensive stance amid renewed cost pressures and interest rate uncertainty tied to the Middle East conflict.
The company said it now expects to approve between 7,000 and 9,000 plots this financial year, down from the previous guidance of 10,000-12,000 plots.
It has also reduced its land spending estimate to 700 million pounds-800 million pounds ($949.55 million to $1.09 billion) as it becomes “even more selective” in an uncertain environment.
The update follows warnings from across the sector, including from Berkeley BKGH.L, which has signalled slower profit growth and paused land buying, while rivals Taylor Wimpey and Bellway have flagged risks from higher costs and interest rate uncertainty.
Barratt Redrow, however, reaffirmed its full-year profit and home completion forecasts, but warned of limited visibility beyond the current fiscal year as the Iran war threatens to push up costs and keep interest rates high.
($1 = 0.7372 pounds)
Reporting by Raechel Thankam Job in Bengaluru; Editing by Subhranshu Sahu
