Planning uncertainty sees Berkeley pause land buying since May

The Berkeley Group has not bought land since May due to ongoing economic turbulence and planning uncertainty, according to a recent trading update.

Related topics:  Business,  Construction,  Housebuilders
Property | Reporter
11th September 2023
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"Housebuilder, Berkeley, has said that it would currently only invest 'very selectively' in new opportunities."

In a recent trading update, the firm stated: “The complexity and protracted nature of the current planning system and lack of clarity surrounding certain regulatory changes affecting our sector, at a time of considerable uncertainty for the UK economy with persistently high inflation and interest rates, continue to deter investment into brownfield regeneration and the wider housebuilding sector.”

During the four months reported, the value of Berkeley’s underlying private sales reservations was around 35% below last year, with enquiries staying at similar levels since the housebuilder’s full-year results.

However, the housebuilder reaffirmed that it was still on course for pre-tax profits of 'at least' £1.05 billion across the current and next financial years. This was likely to be 'slightly' weighted to FY 2024. For the current financial year, profits are expected to be spread evenly between the first and second half.

The housebuilder stated: “Berkeley has not acquired any land in the period. We remain focused on securing and delivering the value inherent in the group’s existing land holdings and pipeline in a disciplined manner that will support a sustained pre-tax return on equity of 15% through the cycle.”

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