BUSINESS Spotlight moves on to housebuilding sector

The state of Britain’s property market will return to the fore this week when a clutch of housebuilding giants report.

Full-year figures on Wednesday from Barratt Developments, the UK’s biggest housebuilder, are among the highlights, with figures set to confirm another robust year for the sector.

But the focus will be on expectations for the year ahead amid fears that Brexit uncertainty and pressure on household finances may start to hit buyer confidence.

A detailed trading update in July has already set the scene for strong numbers from Barratt when it upped its outlook for full-year pre-tax profit to rise from £682.3 million to around £765m.

Laith Khalaf, senior analyst at Hargreaves Lansdown, said the new-build housing industry is in “Goldilocks territory”.

He added: “Demand is high, supply is low, government subsidies are widespread and low interest rates mean mortgages have rarely been as affordable as they are at present. “It’s difficult to see how market conditions improve from here.”

Final figures from Redrow tomorrow and Berkeley on Wednesday are likely to confirm the sweet spot for the sector.

But experts are unsure how long the upturn can last, with mounting signs the property market is cooling amid sluggish economic growth.

Figures from Nationwide Building Society showed house prices dropped by 0.1% in August, signalling pressure on household finances from Brexit-fuelled inflation is hitting buyer confidence.

Troubled Bovis Homes new CEO Greg Fitzgerald is expected to update on his recovery strategy alongside half-year results on Thursday.

The group experienced crisis when problems with sub-standard build quality saw it inundated with customer complaints.

The group saw profits fall 3% to £154.7m last year and has had to set aside £10.5m to cover remedial works and compensation.

It has since announced a raft of improvement measures but analysts at Numis believe the firsthalf figures will continue to make for painful reading.