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Highlights
- The number of homes sold in the UK witnessed a sharp decline of over 52% in October 2021.
- The significant drop in residential transactions could be due to the end of the tax break holiday on property purchases and seasonally lower sales ahead of the winter season.
The number of homes sold in the UK witnessed a sharp decline in October 2021. Around 76,930 residential transactions took place in October, a drop of 52% compared to the previous month and down by 28.2% compared to the same period last year, as per the latest data by Britain’s tax office, HMRC.
The UK housing market had been on fire since last year, boosted by the stamp duty holiday, which the UK government introduced to revive the demand in the domestic housing market. In addition, the housing sector saw high demand for bigger space from the consumers amid lockdown and remote working scenarios. As a result, the average housing price in the UK rose to £270,000 in September 2021, a major rise of over £28,000 in comparison to last year, according to the latest UK housing price index.
The significant drop in residential transactions in October 2021 could be due to the end of the tax break holiday on property purchases in September 2021 and seasonally lower sales ahead of the winter season.
© 2021 Kalkine Media
Let us explore 3 FTSE listed housebuilding stocks that are likely to be in focus:
Redrow Plc (LON: RDW)
FTSE250 listed company is into the acquisition of land and development of properties in the UK. The company reported revenue of £1.94 billion, a rise of 45% for the 52 weeks to 27 June 2021, while its profit before tax stands at £314 million. The company expects revenue of over £2.2 billion for the next financial year, and its forward order book stands at a record level of £1.43 billion.
Redrow Plc’s current market cap stands at £2,289.2 million as of 23 November 2021.
Berkeley Group Holdings (LON: BKG)
FTSE100 listed company is engaged in residential and mixed-use property development, operating its business through various subsidiaries and brands. For the year ended 30 April 2021, it reported a profit before tax of £518.1 million and delivered 2,825 homes to its buyer. Currently, the company has a forward order book of £1.7 billion and future land holdings of £6.88 billion.
Berkeley Group Holding’s current market cap stands at £4,931.7 million as of 23 November 2021.
Vistry Group Plc (LON:VTY)
The company builds houses of different sizes in the UK. It has a huge land parcel which is currently under development. The company has been witnessing strong demand for new properties from home buyers and is on track to deliver full-year adjusted profit before tax of £345 million. Also, the company plans to reduce its net debt to below £125 million and an expected year-end net cash position of £225 million. The company’s forward order book stands at over £3 billion as of 8 November 2021.
Vistry Group Plc’s current market cap stands at £2,514.2 million as of 23 November 2021.
