Persimmon has hiked the number of homes it thinks it can sell this year amid “positive tailwinds” from the Government’s planning reforms.
The housebuilder said it had seen improving sales in the early part of 2025, and that it is targeting up to 11,500 homes this year.
Companies like Persimmon have suffered a rough few years after a spike in inflation caused the Bank of England to raise interest rates.
That made it more expensive for people to take out a mortgage, and in turn hammered the number of new homes companies built and sold.
Interest rates began to fall last summer from their peak of 5.25%, and currently sit at about 4.5%, with further cuts expected this year.
Completing 11,500 homes would be a significant improvement on the 10,664 Persimmon sold in 2024, and marks a upward trend from the year before when it did not even hit 10,000.
It would still be far below the levels seen before interest rates rose, after the company sold more than 14,500 homes in 2021.
Nonetheless, chief executive Dan Finch said the “underlying market fundamentals remain strong”.
The fall in rates combined with improving wage growth and lagging house prices has made house buying marginally more affordable of late, especially for the cheaper end of the market where Persimmon operates.
Richard Hunter, an analyst at Interactive Investor, said interest cuts have “clearly sparked the mortgage market into life, especially for first-time buyers where Persimmon has had a traditionally higher exposure”.
The company has seen sales rates rise by about one-sixth across all of its sites in the first nine weeks of 2025, compared to the same period last year.
And the company’s order book for private sales now stands about one-quarter higher than it did a year ago.
Mr Finch also pointed to Labour’s attempts to get the UK building more homes, which have included changing planning rules to make it easier to get housing projects approved.
Prime Minister Sir Keir Starmer has said he wants 1.5 million new homes built in the UK by the next election.
Mr Finch said: “The Government’s welcome planning reforms and pro-housebuilding agenda demands more of the high-quality, affordable homes which are Persimmon’s core strength, providing a positive tailwind.”
This article was written by PA Business Reporter and Alex Daniel from Press Association and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.