Persimmon lifts 2026 home completions target but warns costs may squeeze 2027 margins
Persimmon lifts 2026 home completions target but warns costs may squeeze 2027 margins
Thu, August 6, 2026 at 6:56 AM UTC
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Aug 6 (Reuters) - British homebuilder Persimmon forecast annual home deliveries at the top end of its range on Thursday, but cautioned that rising costs, boosted by Middle East conflict, could squeeze margins next year.
Britain's housing market, already grappling with easing demand amid elevated mortgage rates and high inflation, is now tackling the rising cost of building materials as energy prices soar because of the Iran war.
The company warned of an estimated impact of £40 million to £50 million ($53.8 million to $67.3 million) over the next 18 months from increased inflation, but said it had already identified savings to cover at least half of that hit.
The builder's in-house manufacturing capabilities in bricks, roof tiles and timber frames have better shielded it from rising costs, compared with peers.
Unlike Taylor Wimpey, Barratt Redrow and Berkeley, which have all scaled back land targets, Persimmon has continued to invest in new sites, though it said a strong land position allowed it to be "even more selective".
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Persimmon said underlying pre-tax profit rose 3% to £170.1 million for the six months ended June 30, with completions rising 13% to 5,189 units.
However, it said buyer enquiries softened in July and open market sales, excluding bulk deals, slipped below year-ago levels in the five weeks to early August.
For 2026, Persimmon now expects to deliver around 12,500 home completions, at the upper end of its previous guidance, with underlying pre-tax profit in line with market expectations of £454 million.
($1=£0.7431)
(Reporting by Raechel Thankam Job in Bengaluru; Editing by Rashmi Aich and Clarence Fernandez)
Source: “AOL Money”
