Persimmon delivers more home sales than expected in 'challenging' market

It now sees full-year underlying pre-tax profits at the upper end of the £415 million to £440 million range expected in the market.

But the group added a note of caution over the outlook amid pressure on homebuyer finances.

It said: “While we are not expecting any material improvement in market conditions this year, early indications from our Boxing Day marketing campaign are encouraging.

“Recent reductions in mortgage rates are helpful for our private customers although we remain mindful of continued affordability constraints.”

UK housebuilding activity has remained in its deepest slump since the start of the pandemic while the wider construction sector has been in contraction for a year, according to the most recent closely-watched S&P Global UK construction purchasing managers’ index survey.

The Bank of England cut interest rates four times in 2025, to 3.75 per cent after a year-end quarter point cut in December.

But homebuyers are still constrained by rising costs while many are yet to roll off far cheaper fixed rate deals.

Despite this, Persimmon said if market conditions remain stable it remains on track for pre-tax profits to rise over the year ahead, with the City predicting between £461 million and £487 million, and an increase in home completions to 12,043.

It said forward sales stood at £1.17 billion, up 2 per cent on a year earlier, including a 4 per cent rise in private forward sales to £680 million at an average selling price of around £293,400.

Dean Finch, Group Chief Executive, commented: "Persimmon performed well during 2025, in a challenging market.

"We have delivered a 12 per cent growth in completions, ahead of market expectations, and we expect to report underlying profit before tax at the upper end of market expectations.

"This performance demonstrates the benefit of our sustained investment in recent years, alongside our self-help strategy, broad geographic coverage and increased outlets, to create a differentiated growth platform.

"I want to extend my thanks to our colleagues, subcontractors and suppliers for their support during 2025, and their role in helping us deliver high-quality, sustainable homes at affordable prices to our customers."

Richard Hunter, Head of Markets at interactive investor, commented: “Challenges have, of course, been many and varied in this most cyclical of sectors.

"General uncertainty, mortgage availability and affordability concerns, slowing construction activity and pressures arising from increases to the likes of National Insurance and stamp duty are meaningful headwinds.

"Indeed, a recent construction survey confirmed subdued demand and fragile confidence towards the end of last year, even after the Budget passed by.”

He continued: “Investors have begun to factor in the potential turnaround in fortunes for the housebuilders, and as one of the preferred plays in the sector Persimmon has seen a particular benefit.”