One of Britain’s biggest developers said it will build more houses this year after a strong start to 2025.
Shares in Persimmon rose 5.5 per cent yesterday after it said that it plans to construct up to 11,500 homes this year.
And the York-based firm, which revealed that profits for last year beat analyst expectations, said its forward order book had soared by £250million.
But Persimmon will still build at least 3,300 fewer homes than it did in 2022 before mortgage rates rocketed.
It follows warnings that Labour will struggle to hit its goal of building 1.5m homes by 2029, or 370,000 a year.
A closely-watched index last week showed residential housebuilding in February declined at the fastest rate since the financial crisis, excluding the pandemic.
Profits up: Persimmon , which revealed that profits for last year beat analyst expectations, said its forward order book had soared by £250m
However, Persimmon said that the Government’s planning reforms and construction targets had boosted its outlook.
And mortgage costs have started to come down after the Bank of England cut interest rates to their lowest level for 18 months, encouraging buyers back to the market.
AJ Bell investment director Russ Mould said: ‘The housebuilders may not get back to the golden period when they benefited from cheap mortgages, rising house prices, stable costs and the Help to Buy scheme stoking demand any time soon, but it does look like the background is stabilising.’
Persimmon yesterday said it wants to build between 11,000 and 11,500 homes during 2025, compared to 10,664 in 2024. Last year’s figure was 7 per cent more than the 9,922 it constructed in 2023.
However, completions were still lower than the 14,868 new homes that it built in 2022.
The developer said its private forward order book – which logs reservations from prospective buyers – has hit £1.15billion, 27 per cent more than the £900million recorded at the same time in 2024.
The FTSE 100 firm reported that pre-tax profits soared 10 per cent to £396.1million, beating analyst expectations of £384million. Revenue jumped 16 per cent to £3.2billion during the year.
Persimmon chief executive Dean Finch said: ‘The underlying market fundamentals remain strong and we are encouraged by the further improvement in our sales rates in the early weeks of this year.’
Richard Hunter, head of markets at Interactive Investor, said it was ‘perhaps a little early to be calling a full recovery’.
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