Vistry shrugs off property market malaise with upped outlook for home builds

The group said it was on track to deliver more than 18,000 completions in the full year, up from previous guidance for 17,500.

Vistry upped its new home build target (PA) (PA Wire)

Housebuilder Vistry has said it expects half-year and annual profits to be higher as it upped its new home build target.

The group, which is holding its annual general meeting for shareholders on Thursday, said it is on track to deliver more than 18,000 completions in 2023-24, which would be 10% higher than the previous year and up from guidance for 17,500.

Vistry put this down to current strong forward sales, which are up 10% year-on-year at £4.9 billion.

The builder has been boosted by its focus on affordable housing, helping shield it from some of the wider woes in the sector inflicted by interest rates being held at 16-year highs of 5.25%.

The group last year unveiled plans to merge its housebuilding division with its affordable homes business Partnerships, through which it works with local government authorities and housing associations to build lower-cost homes.

Greg Fitzgerald, chief executive of Vistry, said: “The group has had a good start to the year with our unique Partnerships model clearly demonstrating its market resilience.

“Working closely with our partners, we are seeing good demand in the Partner Funded market and accompanied by an improving trend for our open market sales, are on track to deliver more than 10% growth in completions in 2023-24, with half-year and full-year profit expected to be ahead of last year.”

It said it was also seeing an improving trend in open market sales rates since the start of the year, with prices remaining “relatively flat”.

But the firm is offering incentives to buyers at around 4% to boost demand.

Homebuyers and mortgage borrowers have been hit hard by interest rates, which have been hiked to the highest level since 2008 in an attempt to rein in sky-high inflation.

The Bank of England has been expected to cut rates this year, but it is uncertain when the first reduction will come, which has taken its toll on the property market.

Lending giant Halifax said earlier this month that house prices have “largely plateaued”, edging up by 0.1% month-on-month in April after a fall of 0.9% in March, according to its index.

Property values grew by 1.1% annually, accelerating from a 0.4% rise recorded the previous month, Halifax said.