Vistry flags tough housing market, reiterates profit forecast

British homebuilder Vistry Group (LON:VTYV) on Thursday joined its bigger rivals in flagging an intensifying slowdown in the housing market but retained its annual profit forecast, reflecting resilience in its key affordable homes business.

The FTSE 250 firm, which works with local authorities and housing associations to build affordable homes, expects adjusted pre-tax profit for the year ending Dec. 31 to be in excess of 450 million pounds.

“Partnerships is demonstrating its resilience and remains on track to deliver revenue growth in the full year,” Chief Executive Greg Fitzgerald said in a statement, referring to the part of the business that builds homes for local government.

British housebuilders have flagged economic headwinds from higher interest rates, which have hit demand and building rates, as the Bank of England battles the highest inflation rate among the big rich economies.

Vistry, which is typically better insulated against housing market shocks as demand for affordable housing is high, said it was able to mitigate the slowdown in the market through bulk transactions in both its Partnerships and Housebuilding businesses.

However, the group said its Housebuilding business, which is similar to its rivals’ operations, had faced “more challenging market conditions” in the half-year period with the broader macro-economic challenges particularly impacting first-time buyers.

The company, one of the biggest British housebuilders in terms of annual homes built after it merged with smaller rival Countryside last year, said weekly sales rate for the half-year to the end of June rose marginally to 0.86 units per site from 0.84 in the comparable period a year before.

Vistry flags tough housing market, reiterates profit forecast