Persimmon announces home sales are 11% above pre-COVID-19 levels
Persimmon (LON:PSM) announced on Wednesday that home sales in 2021 were up 11% compared to before the coronavirus pandemic took hold, demonstrating the continued strength of the UK housing market.
The FTSE 100 housebuilder said forward sales were worth £3bn in the quarter, compared with £2.7bn in 2019, a 23% increase on the year before the lockdown began.
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Mr Persimmon also said the average price of homes being built was up to £252,000, up from £244,500 the previous year.
Chief Executive Officer Dean Finch said the year had started well with production rates at pre-COVID-19 levels and first-half production volumes close to 2019.
Persimmon also buys land, acquiring 6,000 plots in 29 locations this year, he added.
Commenting on the trading update, Hargreaves & Lansdown Select fund manager Steve Clayton said:
“Persimmon’s current sales trends suggest that its full-year outlook could be significantly better than previously expected. I explained that I objected to The market expected the group to match its 2019 performance this year, but rather than just recovering, the group appears to be on track for full growth if it maintains its business momentum. It looks like.”
“There are challenges ahead. With stamp duty coming back, will Persimmon actually be able to maintain the level of production currently required? 6,000 this quarter, meaning the company is facing pressure to increase its new site launch rate. Adding new land parcels is a good start here, but buying land is not the same as building on it.The group is taking a cautious approach for the rest of the year. Construction rate is at 2019 level However, with more than £900m of cash in the bank, Persimmon has a huge advantage. We are facing the challenges with this.”
