Property market showing early signs of recovery, says Barratt

The housing market is showing the first signs of recovery after a sharp slowdown, according to the UK’s largest homebuilder.

Barratt Developments said there were “encouraging” signs of a turnaround after the turmoil caused by Liz Truss and Kwasi Kwarteng’s disastrous mini-Budget last September.

The FTSE 100 firm last month welcomed a ‘significant’ rise in reservations, the number of people applying for new homes.

But boss David Thomas said it was “early days,” with challenges for new buyers.

Reservations fell in the wake of the mini-budget, driving up mortgage rates. Buyers were also put off by fears of a house price crash and inflation.

Barratt’s reservations fell by nearly two-thirds in the last three months of 2022, but bounced back in January as confidence was restored.

Thomas said: ‘The economic and political outlook seems brighter.

‘The cost of living and the energy crisis ended up being a little less serious than people thought.

“Since October we have seen reductions in mortgage rates and although there have been reductions in house prices, they have been more moderate than expected.”

The shares rose 1.7 percent, or 7.8 pence, to 467.9 pence after selling 8,626 homes in the six months to December 31 — 559 more than in the same period a year earlier.

Turnover rose for almost a quarter to £2.8 billion, while half-year profit rose 15.9 percent to a record £501.5 million.