Britain's housing market has not seen the usual pick-up in sales this autumn, one of the UK's biggest housebuilding groups warned today.
Persimmon blamed a lack of mortgage finance, especially for first-time buyers. "Although weekly sales increased gradually during September, we did not experience the normal autumn increase in visitor levels and reservations," the company said.
Autumn is the second most important house-selling season, after spring. Following a lull over the summer months, when many people are away on holiday, the market usually sees an uplift in home buying from September. But this year sales have been sluggish, adding to growing evidence that the market is slowing sharply.
House prices are set for a prolonged downturn, estate agents Savills has warned, and two of the most watched surveys, from mortgage lenders Nationwide and Halifax, have shown price falls in recent months.
"Mortgage availability remains a major obstacle for customers who wish to purchase a home, especially first-time buyers who do not have the required large deposits," said Persimmon. "Further recovery in industry output and sales will be dependent upon an increase in the supply of mortgage products on appropriate terms."
This echoes the warning from rival housebuilding group Redrow two weeks ago, when it warned of a "mortgage famine" that was damaging the industry.
But despite the weaker autumn, Persimmon is fully sold up for this year and has already reserved more than £460m of sales beyond 2010. Cancellation rates remain at 19% and Persimmon expects to increase sales revenues by 10% this year. It is set to complete 9,400 homes, up 5% on last year.
The company has also managed to bring down its debts, which are expected to fall to below £80m by the end of the year.
"Persimmon should have seen similar trends to the rest of the new-build industry in the last couple of months – ie a limited pick-up in reservation rates post the summer," said analysts at Citi.
"We expect the group's prices though to have held up especially as it favours margins and cash over volumes at this stage. It has not been as aggressive about buying land as others but it has continued to add higher margin plots to its portfolio."
