Berkeley ‘cautious’ as London house sales dip

THE chief executive of Berkeley Group has warned of slowing house sales in London and said the company has been more cautious in buying land in recent months.

Shares leapt as much as 9pc after it raised its long-term profit guidance, despite warnings its financial performance would peak this year.

The FTSE 100 firm said it expected to generate £3.3bn in pre-tax profits between 2016 and 2021, up from previous estimates of £3bn. Profits soared 36pc to £533m in the six months to October, while revenues climbed 14pc to £1.6bn.

The company expects to generate £1.5bn of profits in the two years to April 2019, with 60pc of that coming this year. But Rob Perrins, chief executive, said the London-focused housebuilder was exercising caution. “Our big concern is that transaction levels in London have fallen 18pc,” he said, blaming changes to stamp duty and tightening tax rules on mortgage interest.

Its land holdings stand at 32,916 plots in October, compared to 33,771 in April 2017. Berkeley shares closed up 6.9pc at £41.13.