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Berkeley reveals summer land-acquisition drought

Berkeley Group didn’t buy a single plot of land this summer season, it has revealed.

The housebuilder, which expects to make greater than £1bn over this monetary 12 months and subsequent, mentioned on Friday morning (8 September) that it could solely make investments “very selectively” in future.

Berkeley warned in June that supply of recent houses could be “jeopardised” by the planning atmosphere and regulatory uncertainty “except urgently resolved”.

Now it has revealed that it didn’t purchase any land within the interval lined by its newest buying and selling replace, from 1 Might to the tip of August.

“The complexity and protracted nature of the present planning system and lack of readability surrounding sure regulatory adjustments affecting our sector, at a time of appreciable uncertainty for the UK financial system with persistent excessive inflation and rates of interest, continues to discourage funding into brownfield regeneration and the broader housebuilding sector,” mentioned the agency this morning.

“Consequently, Berkeley has not acquired any land within the interval and can solely make investments very selectively in new alternatives.”

The housebuilder mentioned it anticipated to ship £1.05bn in pre-tax revenue throughout 2022-23 and 2023-24, with the stability “more likely to be weighted barely” towards the latter 12 months.

“Supported by a powerful opening forward-sales place, we have now over 90 per cent of FY24 [full-year 2024] income exchanged, and anticipate money due on ahead gross sales to be round £2bn at 31 October 2023,” it added.

“We stay on monitor to be working-capital impartial over the course of this and the subsequent monetary 12 months.”

Berkeley mentioned enquiries had stayed at related ranges over the previous 4 months, however that its worth of underlying non-public gross sales reservations was 35 per cent beneath final 12 months’s price.

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