Just days after PM had urged Britain’s developers to do more to tackle the chronic housing shortage
Shares in Berkeley Group dropped more than five per cent in trading today after it refused to bow to pressure from the government and stated that it would not build more homes due to economic uncertainty.
Britain’s biggest housebuilder blamed ‘market constraints’ like a fall in domestic buy-to-let investors and the “time and complexity of getting on site following planning approval”. All this, it said, means that it cannot justify “the step-up in Berkeley’s production levels that these markets so badly need.”
The response comes in response to PM Theresa May who had urged Britain’s developers to do more to tackle the chronic housing shortage in the country.
But the FTSE 100 firm told shareholders this morning:” The fundamentals of the market in London and the south east remain compelling, but the operating environment and its impact on transaction volumes, whilst sufficient for the business plan and five year profit guidance period that ends at 30 April 2021, do not support the step-up in Berkeley’s production levels that these markets so badly need.
“Our focus is on ensuring we achieve the right planning consents on our long-term regeneration sites, and then working with our partners and stakeholders to bring these through into production.”