Suspected anti-competitive conduct probe extends
The Competition and Markets Authority (CMA) has announced that it will extend its ongoing investigation into anti-competitive conduct until May.
An initial probe into the seven housebuilders was carried out in December, but the CMA has now said that it is undertaking further investigation as it “has not reached a view as to whether there is sufficient evidence of an infringement or infringements of competition law for it to issue a statement of objections to any party under investigation”.
The seven firms being investigated are Barratt Redrow, Bellway, Berkeley, Bloor, Persimmon, Taylor Wimpey and Vistry.
Construction output returns to growth in November
Data from the Office for National Statistics (ONS) has revealed that monthly construction output is estimated to have grown by 0.4% in November 2024, following a decrease of -0.3% in October.
The increase in monthly output came from rises in new work (0.3%) and repair and maintenance (0.5%).
Across the three months to November 2024, the ONS has estimated that construction output increased by 0.2%, driven by a 0.4% increase in new work.
Meanwhile, the Building Cost Information Service (BCIS) has forecast that building costs will increase by 17% over the next five years, whilst tender prices will increase by 19% over the same period.
The firm’s five-year construction industry forecast also predicts that new work output will grow by 21% over the period.
The BCIS All-In Tender Price Index (which measures the trend of contractors’ pricing levels in accepted tenders) saw annual growth of 2.3% in the fourth quarter of 2024.
BCIS chief economist David Crosthwaite said: “Industry sentiment data continues to present positive readings, although since the autumn budget these are now less optimistic than at the time of our previous forecast in September, when the headline S&P Global UK Construction Purchasing Managers’ Index reached a 29-month high.
“We’re predicting that prices will grow more slowly than input costs in 2025 and that this trend will reverse from 2026.”
Housebuilders issue trading updates
Volume developer Persimmon expects profit for the year ending 31 December 2024 to be in the range of £349m to £390m, with an increase of 7% in completions to 10,664 homes thanks to demand being “consistently higher than the prior year since the spring”.
Gleeson Homes delivered a “robust performance” during its half year to 31 December 2024, completing 801 home sales and a net reservation rate of 0.55 per site per week (H1 2023: 0.41).
Crest Nicholson has delayed the publication of its preliminary financial results until February, after its auditors requested more time to complete fire remediation assessments.
The firm said that the cost of remediating its buildings had increased from £145m at its half year to £245m to £255m for its full year.
Vistry saw its completions rise by 7% during 2024 but – as previously reported – is set to achieve a lower than originally expected pre-tax profit of around £250m.
The firm said its completions for the year ending 31 December 2024 totalled 17,200, against 16,118 in 2023.
Taylor Wimpey has announced that it is set to achieve its expected operating profit for the full year, but anticipates build cost pressures in the year ahead.
The housebuilder said that its operating profit for 2024 will be around £416m, with 9,972 completions against 2023’s 10,356.
Meanwhile, brickmaker Ibstock has said that its income for 2024 will be down by -10% when it announces its results for last year, with revenue being around £365m.
The reduction is largely attributed to a £6m hit relating to restructuring costs at its glass fibre reinforced concrete business.
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