Housebuilder Persimmon says it still expects to trade in line with expectations this year, despite pressures on buyers and rising costs linked to the war in Iran.

In a trading statement on Thursday 12 November, the FTSE 100 builder said total forward sales in the four months to 1 November were up 1% to £2.82 billion. Private forward sales increased 3% to £2.15 billion, underpinning its target of around 12,500 completions in 2026, with 77% of expected open-market private deliveries already exchanged or completed. Net private sales improved to 0.79 per outlet per week, or 0.65 excluding bulk deals.

Costs cloud 2027

Persimmon warned that inflationary pressures are expected to add around £30 million to £40 million to its costs in 2027, which, together with higher financing costs, will limit near-term profit progression. The group said operational efficiency measures should substantially offset the additional cost headwinds by 2028.

Market conditions are expected to remain challenging, reflecting continued affordability constraints, higher borrowing costs and uncertainty over build costs arising from the conflict in the Middle East. The average private selling price in the forward order book rose 2% year on year to around £301,900, while incentive levels remained stable at about 5%.

Planning pipeline grows

Chief executive Dean Finch said the company had increased sales and planning approvals while the wider housebuilding sector was in decline. Planning approvals rose 12% to 8,722 plots in the nine months to 30 September, and Persimmon has opened 57 new sales sites this year, with around 100 expected by the end of December. First-time buyers account for around 35% of its private sales. Sharecast reported the trading update, and The Market Reporter covered the 2027 cost warning.