Crest Nicholson has fallen into the red and slashed its dividend, underscoring the difficulties facing the UK property sector. The FTSE 250 housebuilder reported a pre-tax loss of £30.9 million for the six months to the end of April, compared with a profit of £28.4 million a year earlier.
The company issued its fourth profit warning in a year, saying it now expects adjusted pre-tax profit of £22 million to £29 million for the full financial year, below analyst forecasts of almost £39 million. Home completions fell 12% in the half-year period. Shares dropped 8% in early trading on Thursday.
Crest Nicholson blamed volatile mortgage rates and slowing demand, noting that momentum had “softened slightly” since April. It said many consumers were waiting for interest rate cuts, which are now expected later than previously thought. The upcoming general election was also creating “some short-term uncertainty”.
The company took a one-off charge of £31.4 million – nearly double its earlier estimate – after reviewing costs to fix building defects at four sites. It cut its interim dividend by more than 80% to 1p. Crest said the economic uncertainty following the September 2022 mini-budget continued to affect the market, with planning delays also hampering progress.
Separately, a Royal Institution of Chartered Surveyors survey showed a net balance of 8% of property professionals reported a fall in homebuyer demand in May, the weakest reading since November 2023. Demand was weakest in the south-east and south-west of England. However, tenant demand continued to outstrip supply, with a net balance of 35% reporting a rise.
