A HOUSEBUILDER with sites across York and North Yorkshire is forecasting higher-than-expected profits due to the strength of the housing market.

Barratt Developments PLC said highlights of the year to end June 30, 2021, include the completion of 17,243 homes, 36.8 per cent up on last year's 12,604 homes which was affected by the coronavirus pandemic.

This was just 3.4 per cent below its 17,856 total home completions in 2019 for Barratt whose sites include The Chocolate Works in York, Saxon Gate in Stamford Bridge and Fairfield Croft in Skelton. 

Profits for the year to end June 2021 are expected to be above the top end of its expectations due to a strong market and rising prices.

Forward sales for the current year are worth £3.47bn - the equivalent of 14,334 homes.

House prices rose 3.2 per cent to an average of £289,000 - up from £280.3K the previous year - however Barratt said this was being matched by raw material and build inflation, which has risen from 2 per cent during 2021 to between 3-4 per cent.

David Thomas, chief executive, said: “It is thanks to the hard work, resilience and flexibility of our employees and sub-contractors that we made such excellent progress this year, whilst maintaining our high standards of quality and service.

"We have seen continued strong demand for our high quality, energy efficient homes on well-designed developments, enabling us to deliver 17,243 home completions this year.

"Whilst these are still uncertain times, we enter the new financial year in a strong position and remain focussed on our medium term targets, including delivering 20,000 homes a year.”

Daniel Smith, managing director at Barratt Developments Yorkshire East, added: "We have seen a strong demand for our high quality, energy and time efficient homes in our developments across Yorkshire, which is further supported with the launch of new sites and new jobs being created throughout the region.

"We are also extremely proud to have been rated as a five star housebuilder for the twelfth consecutive year, making us the only housebuilder to achieve this.

"We continue to keep the safety of our customers and employees at the centre of our operations, alongside supporting the local communities in which we build. Whilst these are still uncertain times, we enter the new financial year in a strong position and remain focused on our medium term targets."

Another highlight is that its adjusted profit before tax is anticipated to be marginally above the top end of the range of market expectations.

The trading update is for the year ended 30 June 2021 ahead of publishing its annual results on September 2.

The company reported a strong balance sheet with year-end net cash of about £1,315m (30 June 2020: £308.2m; 30 June 2019: £765.7m), ahead of previous guidance.

Barratt received 93 Pride in the Job Awards in the June 2021 NHBC awards, more than any other housebuilder, for the 17th consecutive year

Adjusted items in the year comprise grant income of £26m repaid under the Coronavirus Job Retention Scheme (‘CJRS’) in the first half.

Barratt also has costs associated with legacy properties.

In its trading statement, the company said: "We recognise that the complex issues surrounding fire safety guidance are causing distress for affected homeowners across the country.

"We will continue to dedicate significant focus to this area, as founding signatories to the Building Safety Charter and active members of the Government’s Early Adopters Group, which is committed to protecting life by putting safety first ahead of all other building priorities.

"All of our buildings, including the cladding and external wall systems used, were signed off by approved inspectors as compliant with the relevant Building Regulations at the time of construction.

"Alongside evolving Government advice on fire safety for multi-storey buildings, we are working with building owners, management companies and expert engineers on assessments of buildings we have constructed and the solutions needed to support leaseholders and residents at those buildings.

"We now expect an additional charge of about £30m in the second half and therefore legacy property costs (including JVs), comprising both the cladding and Citiscape and associated reviews, are now expected to total c. £81m for the year.

"Whilst the charges in respect of cladding and external wall systems reflect our current best estimate of the extent and future costs of work required, as assessments and work progresses or if Government legislation and regulation further evolves, estimates may have to be updated."