Persimmon home sale completions tumble, but builder observes encouraging signs

Persimmon, one of the UK’s largest housebuilders, completed sales on 1,136 homes in the three months to March 31, down from 1,950 a year earlier.

The value of its forward sales order book also dropped, down to £1.7 billion from £2.4 billion.

Chief executive Dean Finch said the performance was as expected “and reflects the challenging trading conditions” in the last few months of 2022.

The FTSE 100 company is among firms hit by the UK housing market slowing in recent months, with consumer finances hit from the cost of living crisis and high mortgage rates hurting demand.

All of the major housebuilders saw a drop-off in interest from would-be buyers in the weeks following September’s mini Budget. But Finch said: “Trading over recent weeks has offered some signs of encouragement with visitor numbers up, cancellation levels normalising and sales rates continuing the steady improvement evident since the start of the year.”

The update comes after the firm last month said total home sales completed increased to 14,868 last year from 14,551. It cautioned that could tumble to 8,000 to 9,000 in 2023 if the current selling rates continue.

Finch has now said if sales rates continue at the levels seen year to date, Persimmon would expect full year volumes to be toward the top end of the completions guidance.

Persimmon said: “These early signs of increasing customer confidence are particularly evident in demand for our three, four and five bed homes. While interest remains good for all our homes, sales to first time buyers remain more challenging, reflecting stretched affordability and reduced mortgage availability at higher loan-to values, particularly in regions with higher house prices.”