After the curious non-appearance of Persimmon’s trading update last week, it is down to peer Barratt to indicate how the current mortgage uncertainty is affecting housebuilding business.
Halifax’s latest housing price index showing the fastest fall for twelve years suggests the tone will be cautious.
UBS believes there are three things to focus on: Recent reservation trends given the increase in mortgage rates; pricing trends and how those compare to build cost inflation and early outlook/building blocks for the full year.
The Swiss bank does not expect any formal guidance as a result of the current end-market uncertainty and the early stage of the fiscal year.
UBS itself though is predicting volumes in the twelve months to June 2024 of around 15,500, down 8% on the year just ended, and profits of £560mln (£534mln).
For the year to June 2023, UBS expects volumes of 16,800 and pre-exceptional profits of £884mln with net cash of £918mln at the year-end.
Barratt’s trading update is due on Thursday 13 July.