Redrow expects revenue dip as house reservations fall

REDROW has become the latest house builder to issue a warning on sales in the wake of the mini-budget.

The FTSE 250 company cut its fullyear revenue forecast from £2.3bn£2.4bn down to £2.1bn, meaning it expects sales to be flat on last year.

In an update ahead of its shareholder meeting, Redrow said reservations in the past four months fell by almost a fifth on a year ago, with the forward order book cut from £1.5bn to £1.4bn.

It blamed market chaos caused by the disastrous mini-budget in September.

Redrow said reservations in the 18 weeks to Nov 6 fell by 19pc to £515m on last year. Chairman Richard Akers said the developer had started the financial year “in a strong position” following two years of buoyant demand, but he warned: “Recent instability in financial markets has had a negative impact on the housing market and the business has had to adapt to the changing economic outlook.”

Redrow’s warning came after rival Taylor Wimpey revealed that one quarter of home purchases had been cancelled in the second half of the year amid the worsening economic climate.

Barratt has also issued a profit warning following a big drop in reservations.

The slowdown is expected to be followed by a fall in prices next year, although analysts remain divided on the extent of the coming drop.

Halifax, which publishes a monthly house prices index, said prices fell by 0.4pc from September to October, with a typical UK home costing £292,598.