15 April 2026
If you are covering Barratt Redrow’s latest financial results, please find below a comment from Oli Creasey, head of property research at Quilter Cheviot:
“Barratt Redrow's third quarter trading statement this morning shows a company in good health. Reservation rate for the period between January and March 2026 is slightly ahead of the same period last year at 0.67x, and the company has reiterated full year guidance for completions between 17,200-17,800 – a 6% increase versus 2025 at the midpoint. Management remarked that the Middle East conflict has had limited impact on the expected performance, not least because the company is 94% forward sold for the remainder of the financial year. Only 10,718 homes have been sold to date, meaning a bumper fourth quarter will be required to hit that target, although it would be a surprise if this guidance wasn't achieved given the size of the forward order book.
“The company is unusual in that its financial year end is June 2026. And so projections for the remainder of the financial year only cover the next 11 weeks of the calendar. Still of interest, but it is the longer-term prognosis of the housebuilding market that investors are more interested in, not least because the impact of the Iran war is not likely to be felt immediately. Those buying houses today may have secured a mortgage before the start of hostilities, for example. Barratt has noted that inflation for is likely to remain in-line with prior expectations, but that material costs inflation is likely to increase for the next financial year. Visibility on 2027 performance is limited as management intend to provide more specific guidance at the end of its fourth quarter.
“Perhaps most interesting therefore are the land purchase statistics. Barratt had already committed to buying less land this year compared to what had been sold in order to optimise the size of its landbank, however, that guidance has today been reduced by a further 3,000 plots, meaning that only around half of the land sold this year will be replaced. Management have remarked that they are being more selective given the less certain geopolitical backdrop, which raises some concern that volumes beyond June could be impacted quite significantly. If sales volumes were to fall by 3,000 plots, that would reflect an approximate 17% drop year-on-year. To be clear, some or even all of the 3,000 plot reduction could be part of the landbank optimisation, though it was not part of the guidance provided by the company three months ago.
“We will have to wait for more specific guidance to be sure, but following Berkeley Group's decision to slow land purchases earlier this month, there is increased concern that the housebuilding sector is digging in for another tough period.”
