Berkeley snaps up more land for thousands of homes in vote of confidence in London

Housebuilder Berkeley Group’s chief executive Rob Perrins has shrugged off concerns that London could see a mass exodus of home buyers after the pandemic, and invested in more land.

There have been worries the virus crisis could make numerous people want more outdoor space and working from home offices away from the capital.

But Berkeley’s Rob Perrins said people will still want to live in the capital, and his firm has firm has spent some £400 million on sites and construction in the capital in the six months to October 31.

The FTSE 100 company bought sites in Southwark, Paddington and Sutton, where collectively there is scope for around 2400 homes, of which a number will be affordable.

Perrins told the Evening Standard: “I am very optimistic about the future. Yes there a lot of headwinds ahead, such as Brexit and the stamp duty holiday coming to an end, but I think London will still thrive. People will still want to live in London, and be close to good transport links. Plus businesses will continue to want head offices in the capital.”

He added that his firm’s sites “offer fantastic connectivity and open spaces”.

In the first half Berkeley saw pre-tax profits decrease 16.6% to £230.8 million, but it is still on track to meet its £500 million full-year target.

Revenue was 3.8% lower at £895.9 million.

The UK housing market was hurt at start of lockdown when people were initially told to avoid moving where possible. But builders and estate agents have since seen a spike in demand, benefitting from Chancellor Rishi Sunak in July announcing a suspension of stamp duty on property sales of up to £500,000 until March 2021.

Perrins said: “We have seen a resilient market during the first half of our financial year, aided by the Government's temporary reduction in stamp duty easing this significant barrier to household mobility.”

But he added: “We are however very conscious of the cyclical nature of the housing market, the stability of which is closely linked to consumer sentiment. The coming months will see further evidence of the impact of Covid-19 on the economy, including the impact of the second national lockdown and tapering of Government support and stimuli, as well as the emergence of the UK's new trading relationships with the European Union and rest of the world, following Brexit.”

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