Redrow PLC (LSE:RDW) has seen the number of house reservations fall 19% in recent weeks and said it expects revenue to be flat for its current year due to selling prices remaining higher.
For the year to end-June 2023, the housebuilder now expects revenue of circa £2.1bn, the same as the past year, down from its guidance of £2.3-2.4bn in September.
Operating margin is expected to fall to around 18% from 19.3%, it said in a statement ahead of its annual shareholder meeting.
Private reservations of £515mln were taken in the first 18 weeks of the new financial year, down from £639mln in the same period a year ago.
Revenue per outlet was down 23% to £238,000 and private reservations slumped 28% to 0.49 per outlet per week from 0.68 a year earlier.
Average private selling prices were up 6.9% to £483,000, which the FTSE 250-listed group attributed partly to its geographical and product mix and general house price inflation.
Inflation of build cost is seen at a similar level, 7%, for the year.
The forward order book has shrunk to £1.36bn from £1.49bn a year ago and £1.44bn in early July this year.
Chairman Richard Akers said “recent instability in financial markets has had a negative impact on the housing market and the business has had to adapt to the changing economic outlook”.
Citing the current economic uncertainty, the group said it was “being selective and limiting our land buying for the time being”, having added 724 plots to take its holdings to just under 1,500 plots.
There was net cash of £182mln and the board expects to still have more than £150mln by the end of June 2023.