Housebuilders on the move as buyers return

INVESTORS cheered after major housebuilders said a tentative recovery was under way and buyers were coming out of the woodwork.

Both Persimmon and Bovis Homes-owner Vistry said interest in new homes has picked up since lockdown restrictions on the housing market eased in mid-May.

They also said average selling prices for their properties had held steady.

Persimmon’s revenues dived by 32pc between January and June to £1.2bn – but its building sites are back to normal work levels and reservations have surged by 30pc since its sales offices reopened.

Vistry Group’s housebuilding turnover plummeted 60pc to £344m during the same period, when the market went into an unprecedented hibernation.

Both will benefit from the temporary holiday on stamp duty on the first £500,000 of all property sales announced earlier this week by the Chancellor.

Despite the recent rebound, the outlook for the housing market remains sullen – with figures predicting house prices could fall by 5pc this year and almost 11pc in 2021.

The Centre for Economics & Business Research added that it does not expect them to return to pre-pandemic levels until ‘at least’ 2023. But traders chose to focus on the more optimistic here and now, sending Persimmon shares up 6.4pc, or 156p, to 2589p, while Vistry rose 0.4pc, or 2.5p, to 714p.

Other housebuilders also edged up, with Barratt Developments up 2pc, or 10.2p, to 532.2p and smaller peer McCarthy & Stone up 0.1pc, or 0.1p, to 74.1p. Low-cost housebuilder MJ Gleeson said it expects a ‘rapid recovery’ after sales fell by almost a third in its last financial year. Stock was flat at 690p.

Shares in Irish builders merchant Grafton Group rose 4.1pc, or 26.5p, to 666.5p after it reported that sales jumped 11pc in June compared with last year.

But turnover fell 19pc between January and June – and bosses were quick to add that they were cautious about how things will go between now and Christmas.

Stock markets were in the red, brushing off data from the US that showed slightly fewer people applied for unemployment benefits last week, indicating the world’s biggest economy is beginning to reopen.

The FTSE 100 fell 1.73pc, or 106.54 points, to 6049.62, while the

FTSE 250 closed down 1.16pc, or 200.11 points, to 16985.13.

Wall Street also dropped, despite a positive start, with the Dow Jones edging down 1.4pc and the S&P 500 shedding 0.6pc. But gold prices shined, rising 0.1pc to $1,812 per ounce. Trade tensions and the coronavirus have sent investors flocking to the yellow metal, which has hit eight-year highs and is inching closer to the previous record level of $1,921.

Shareholders got the jitters after shared office space provider Workspace Group warned it is bracing for a difficult few months ahead.

Shares fell 2.6pc, or 16.5p, to 610.5p after it collected 65pc of rent due between April and June, down from about 80pc last year.

Enquiries across the three months halved compared with 2019, but Workspace said there had been a huge uptick from 272 in April to 765 in June.

Covid-19 lockdown measures meant swathes of the UK’s workforce have had to do their jobs from home. Only 15pc of staff at the companies that use its spaces – which include Nutmeg and Hugo Boss – are back in the office.

But while the near-term outlook is downbeat, some analysts believe co-working spaces could be the winners in the long-run, predicting that companies looking to ditch having a full-time office will rent spaces on a parttime basis for meetings.