Vistry Group has reported a strong demand for affordable homes, despite subdued private sales activity. The house builder remains confident in achieving its full-year adjusted profit guidance.
Continued Demand for Affordable Homes
Private Sales Slowdown
In contrast, there has been a slowdown in open-market private sales during the summer months. Higher interest rates and customer cost pressures have contributed to this decline. Vistry Group was not able to achieve the expected seasonal increase in private sales in September.
Vistry Group reaffirms its target of achieving an adjusted pretax profit of £450 million ($547.4 million) by 2023.
The average weekly private sales rate since July 1 has been 0.60, slightly lower than the rate of 0.64 recorded a year ago. However, the forward order book is promising, with all private units for 2023 already sold in advance, totaling £4.3 billion.
As part of its strategic shift, Vistry Group plans to reduce its employee headcount by approximately 200. The company aims to focus its operations entirely on the partnerships model, collaborating with the government and housing associations to deliver affordable, mixed-tenure housing.
Moreover, Vistry Group expects to achieve around £25 million of annualized cost savings through this shift, in addition to the £60 million in synergies gained from the acquisition of Countryside Partnerships in November last year.