Here’s what you need to know
Persimmon has announced a five per cent rise in revenues to £1.84 billion in the first half of 2018.
Completions rose by 3.6 per cent to 8,072 homes and the average selling price increased by 1.2 per cent to £215,800.
In the same period last year, revenues were up 12 per cent, completions were up eight per cent, and the average selling price was up 3.5 per cent.
Shares rose two per cent in early morning trading.
Laith Khalaf, Senior Analyst, Hargreaves Lansdown: “Persimmon is still selling more houses at higher prices, but business is not booming like it was last year. Indeed the share price has fallen by more than 10 per cent in the last month as investors have lowered their expectations for the housebuilding sector.
“The UK housebuilding industry has been on a terrific run, fuelled by low interest rates, rising property prices, and the Help to Buy scheme. But some of the wind is now being taken out of the housebuilders’ sails, as property price growth has slowed, and building costs have ticked up.
“Interest rates still remain attractive for house buyers, and the Help to Buy scheme continues to provide critical support for transactions in the new build market.While the government has committed to the scheme until 2021, share prices in the sector may come under pressure as we get nearer to that date, unless the deadline is extended.
“None of this adds up to a crisis for the housebuilders just yet, but the pickings may be slimmer from here on in.”
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