UK homebuilder Persimmon sees 2027 volume growth but flags cost pressures (updated)

Persimmon

Today 07:25

Expects to meet 2026 market expectations
Well-placed to play a leading role in delivery of 'Your First Home'
Current private forward sales position has increased to £2.15 billion
Adds details, background, shares
Nov 12(Reuters) - Persimmon PSN.L forecast a further increase in housing volumes in 2027, supported by its land pipeline, but expects near-term profits to be held back as Britain's homebuilding sector grapples with rising construction costs.
     The FTSE-100 company, which raised its annual home completions forecast earlier in the year, said on Thursday it expects to deliver 2026 performance in line with market forecasts and that it had identified actions to offset Iran-war-related increase in construction costs, without giving details.
"Our clear strategy has allowed the Group to increase both sales and planning approvals at a time when the overall sector is declining," CEO Dean Finch said in a statement.
Persimmon shares were up 4% in early trading. 
Britain's housing market is struggling with rising mortgage costs and pressure on consumer finances. 
Persimmon's vertically integrated model, which includes the production of key building materials such as bricks, timber and tiles, has helped to limit the impact of higher building costs.
However, soaring energy prices have increased costs of manufacturing materials and are expected to be a headwind in 2026 and 2027.
The company said it was too early to assess the impact of Britain's first-time buyer subsidy on 2027 performance, but that it was well-placed to play a leading role in its delivery over time, noting that 35% of its private sales from January to November 1 were to first-time buyers.
The company's current private forward sales position has increased to £2.15 billion ($2.85 billion), compared with £2.09 billion a year ago.
($1 = 0.7543 pounds)

 (Reporting by Simone Lobo in Bengaluru. Editing by Jochelle Mendonca and Mark Potter)
 ((Simone.Lobo@thomsonreuters.com, +919920570373))