Barratt brings in hiring freeze as UK housing market slows down – The Guardian

Barratt brings in hiring freeze as UK housing market slows down

Housebuilder also cuts land purchases, with it forced to scrap proposals for 3,293 plots

Business live updates: ‘Marked slowdown’ in UK housing market

Britain’s largest housebuilder, Barratt Developments, has introduced a hiring freeze and is “significantly” cutting back on buying land as it steels itself for a further slump in the UK housing market.

Barratt said it was responding to a “marked slowdown” in the UK housing market after a rise in interest rates that had made mortgages more expensive for prospective homebuyers.

The company said the average weekly net number of private reservations of properties fell in the second half of last year, down from 259 to 155.

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It was also forced to scrap building plans for 3,293 land plots, cancelling out the 3,003 plots that proceeded with construction. The net cancellation of 290 plots compares with the net addition of 8,869 a year earlier.

“The first half of the financial year has … seen a marked slowdown in the UK housing market,” said Barratt’s chief executive, David Thomas.

“Political and economic uncertainty impacted the first quarter; this was then compounded by rapid and significant changes in mortgage rates, which reduced affordability, homebuyer confidence and reservation activity through the second quarter.”

Barratt is warning that the outlook for the first half of 2023 is “uncertain”, adding that the health of the UK housing market would depend on homebuyer confidence and the availability of competitively priced mortgages.

Lenders have increased mortgage borrowing costs in response to rising UK interest rates, which have increased nine times in the past year. Lenders raised mortgage rates

The original article can be found here