One of the UKs biggest house builders, Barratt Developments have warned that interest rate rises and the recent credit squeeze will hurt the housing market in the forthcoming coming months.<\/p>\n
Its remarks came as it reported a 9.3% rise in annual pre-tax profit to \u00c2\u00a3427.8m ($862.6m).<\/p>\n
Recent turmoil on the financial markets has led to mortgage lenders putting up their rates and tightening up their lending criteria.<\/p>\n
Barratt announced that the long-term picture for house prices was still positive.<\/p>\n
Barratt said forward sales rose 67.3% to a record \u00c2\u00a31.4bn as of end-June and this had increased further to \u00c2\u00a31.7bn as of last week.<\/p>\n
Pressure on lending institutions has led to a tightening of lending criteria and mortgage availability<\/p>\n
Shares in the housebuilder jumped nearly 3% to trade at 746.5 pence in early trade.<\/p>\n
But its shares are still down almost a fifth from a month ago with investors worried over the outlook for the housing market.<\/p>\n
The housebuilder said it was not sure how long it would take the UK housing market to recover from recent events.<\/p>\n
“The recent credit squeeze has further affected customer sentiment and pressure on lending institutions has led to a tightening of lending criteria and mortgage availability,” said Mark Clare, Barratt’s chief executive.<\/p>\n
“It is not yet clear how quickly the market will recover but we have to assume that there will be downward pressure on volumes and price inflation in the short-term.”<\/p>\n
Barratt became the third-largest housebuilder in Britain following the purchase of commercial property specialist Wilson Bowden for \u00c2\u00a32.2bn earlier this year.<\/p>\n","protected":false},"excerpt":{"rendered":"
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