Dean Finch, Persimmon's chief executive, has issued a stark warning about the financial impact of new levies on the housebuilding industry. He estimates an additional £40m in annual costs for his company and "billions" across the sector.
Speaking to The Times, he highlighted a "disconnect" between the government's cost impositions and its housing targets. "There are billions of extra costs coming down the line just when the government wants us to crank up building new homes," Finch remarked, as reported by .
He expressed concerns over the affordability of the cladding levy for smaller builders, estimating it could add £1,750 to £2,000 per home. With a goal of constructing 300,000 homes annually, this could translate to a minimum of £525m each year.
The levy was introduced following the Grenfell fire tragedy in 2017 and has been criticised for broadly targeting the industry instead of those responsible for unsafe cladding. This comes alongside nearly 40 leading housebuilders committing to remediate buildings they constructed in the past three decades, a move that has already amounted to a £2bn expense.
Finch also pointed out that additional budgetary costs and the residential property developer tax—a 4% corporation tax surcharge on profits exceeding £25m—will collectively increase annual costs by £30m to £40m.
While he "warmly welcomed" the government’s reforms to the National Planning Policy Framework, he warned the cost burden would make its presence felt. "If you keep adding billions of costs, there is less money to buy land and build homes."
Persimmon is currently on track to deliver around 10,500 homes for the full year following a stabilisation of the º£½ÇÊÓƵ housing market in 2024.
Despite a strong year, the housebuilder’s share dropped in the weeks surrounding the Autumn budget despite Reeves’ announcement of a range of measures to support ³¢²¹²ú´Ç³Ü°ù’s target, including skills training, reforms to the planning system and additional assistance for affordable housing.
