UK's Persimmon confident for 2024, retains annual build target

By Aby Jose Koilparambil and Suban Abdulla

(Reuters) -UK housebuilder Persimmon said on Thursday it was confident for the rest of the year and reaffirmed its annual home-build targets after an improved first-quarter sales rate.

Britain's housing market has shown a recovery from a recent slowdown as investors readied for cuts to interest rates by the Bank of England later this year, although a delay in lowering rates has tempered hopes of a better-paced recovery.

"Trading over recent weeks has been encouraging with robust visitor numbers and enquiries," Persimmon Chief Executive Dean Finch said in a statement.

Persimmon's shares, which have gained about 14% in 2023, rose around 1%.

Net private sales rate per outlet was up 6% in the first quarter at 0.66 homes, Persimmon said, an improvement on the 0.59 units reported for the first 10 weeks of 2024.

The FTSE 100 company said its forward sales - a key industry metric that gauges near-term demand - was 1.75 billion pounds ($2.18 billion), as of April 25, compared with 1.69 billion pounds in the year-ago period.

"The private order book has also climbed at double-digit rates, indicating that buyers have more confidence about the health of the market than they did 12 months ago, so are more willing to sign on the dotted line, said Aarin Chiekrie, equity analyst at Hargreaves Lansdown.

The spring selling season usually brings in good sales for housebuilders compared with other periods.

Earlier this week, Taylor Wimpey posted an improvement in sales rate through the year and said the spring selling season had progressed according to its expectations.

Persimmon, which builds studio apartments to five-bedroom houses, retained its 2024 home build target of 10,000 - 10,500 units.

($1 = 0.8013 pounds)

(Reporting by Aby Jose Koilparambil in Bengaluru and Suban Abdulla in London; Editing by Sherry Jacob-Phillips and Alexander Smith)