The housing shortage coupled with government support for buyers during the pandemic has helped the company behind Barratt Homes step closer to its goal of building 20,000 new homes a year.
Barratt Developments saw an “excellent recovery in home completions” in the 12 months to June 30, almost reaching pre-pandemic levels.
It said it completed 17,243 in the year, which was just 3 per cent down on 2018-19 – before Covid-19 hit.
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The business expects profits this year to be above the top end of market expectations, with average selling prices continuing to rise.
New figures for the year to June 30 show the company – which also owns David Wilson Homes, Barratt London and the Wilson Bowden commercial property group – expects adjusted pre-tax profits for the year of £107 million.
The group - first founded in Newcastle by Sir Lawrie Barratt in the 1950s but now headquartered in Coalville, Leicestershire - said average selling prices for its typical family homes currently stands at £339,800, up almost £20,000 on a year ago.
Shares in the business were up about 1 per cent this morning at £7.03.
Barratt chief executive David Thomas said: “It is thanks to the hard work, resilience and flexibility of our employees and sub-contractors that we made such excellent progress this year, whilst maintaining our high standards of quality and service.
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“We have seen continued strong demand for our high quality, energy efficient homes on well-designed developments, enabling us to deliver 17,243 home completions this year.
“Whilst these are still uncertain times, we enter the new financial year in a strong position and remain focussed on our medium term targets, including delivering 20,000 homes a year.”
Barratt also revealed a further hit for cladding safety works after the Grenfell Tower disaster, taking its total annual bill to more than £80 million.
The group said it is setting aside around another £30 million for remedial works in the second half, leading to a full-year provision of about £81 million.
It added that it is liaising with owners, management companies and expert engineers on assessments of buildings it constructed and the works needed to support leaseholders and residents.
The new figures come a day after insurance company Aviva put out survey results suggesting half of people who bought any sort of home during the coronavirus pandemic regret how much they paid.
Aviva said some 94 per cent of people who had purchased a home since March 2020 said they had felt under pressure to buy quickly, typically taking just 46 minutes to view their property.
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The insurer interviewed 2,200 海角视频 home owners as part of its “how we live” research, including 500 who had agreed a purchase between March 2020 and June 2021.
Half of people who had agreed a purchase during the pandemic said they now regret the price they agreed to.
This compared with just one in eight of home buyers who had bought their home before early 2017.
Nearly a quarter of those who bought between March 2020 and June 2021 said they agreed a figure over the asking price – compared with just 8 per cent of those who had done so in the year before March 2020.
Much of the housing market was effectively shut down early on in the pandemic, resulting in surges of buyer interest as it reopened and people looked to make lifestyle changes, perhaps by moving to a more rural area or finding a property suitable for home working.
House prices have hit a string of new record highs in recent months.
A temporary stamp duty holiday, introduced last year, also helped to boost demand. The holiday is now being tapered before reverting to normal levels this autumn.
Aviva said a third of people buying during the pandemic said they were spurred on by the stamp duty holiday.
A similar number said they had lost out on other properties because they had not made an offer quickly enough.
Danni Hewson, a financial analyst at stockbroker AJ Bell, said: "The muted reaction to housebuilder Barratt Developments’ lifting of full year guidance hints at longer-term concerns among investors over how long the current boom can last.
“Pent-up demand built up during the pandemic, the changing requirements driven by a shift to working from home, mixed with more than a dash of state support has been an extremely powerful cocktail for the housing market.
“And this combination has seen the good times roll for housebuilders like Barratt.
“However, news that Barratt’s profit for the year to the end of June will be above the top end of expectations is behind us now and, after a party time for the sector, there is increasing concern over a possible hangover to come.
“For the time-being rising house prices are keeping pace with increases in raw material and other build costs, however the obvious corollary of this is how a downturn or even a relative cooling in the property market will leave Barratt exposed.
“The good news is that, like several of its peers, Barratt is sitting on an enormous pile of cash. This gives Barratt the ability to reward shareholders for the patience should there be a deterioration in trading.
“The exceptionally strong balance sheet at Barratt’s disposal also allows it to make investment decisions for the long term which should leave it well placed through several economic and housing market cycles.
“One potential issue floating in the background is the competition authorities’ investigation into the sale of leasehold properties, with Barratt, unlike its peer Persimmon, yet to reach any accommodation with the regulator.”