Taylor Wimpey reported strong performance in its latest Trading Statement, backed up by low interest rates and Help to Buy, but suggested political and economic risks could impact consumer confidence next year.
The company said that sales rates for the year to date were strong at 0.81 sales per outlet per week (2017: 0.81) with good levels of customer demand and a 2H sales rate of 0.77 compared to 0.71 in 2017. The current order book is 12% higher than 2017 at 9,783 homes worth £2.4bn.
Looking ahead, the company believes increased housebuilding targets and the end of Help To Buy in 2023 will be significant, as will political and economic uncertainty. It said, however, that a ‘well-capitalised balance sheet and excellent order book’ give the company ‘resilience and flexibility’ to react, adding there is potential for ‘significant growth’ from 2020.
Pete Redfern Chief Executive said: “We have delivered a strong performance during the second half of 2018, with very good sales rates supported by positive customer demand and a supportive lending environment. This builds on our strong forward order book and puts us on track to meet full year expectations.
“Looking ahead to 2019, we remain mindful of wider political and economic risks and the potential impact on customer confidence. However, with a strong balance sheet in place and a high-quality landbank, our business is well positioned to deliver further sustainable growth and cash flow over the medium term.”
It would be remiss of course for any housebuilder not to express concern over Brexit. However, the statement seems to suggest that basic market fundamentals including lack of housing supply over demand augur well for the market medium term.