Homebuilders are under renewed pressure across the UK, with the latest economic data indicating that the value of shares in the sector have dropped on the back of the Brexit decision.
While several recent studies have served to allay fears that the decision to exit the European Union could plunge the overall economy into freefall, Deutsche Bank is by no means confident that businesses working in the residential property sector will prosper over the coming weeks and months.
Indeed, in its latest economic forecast for the UK, the German banking giant has been quoted by the Guardian as stating: “Reflecting Brexit uncertainty we have reduced our forecasts for the UK
Housebuilders to reflect a moderate downside scenario.”
More specifically, the paper reveals that Deutsche Bank is planning for a possible ten per cent reduction in the number of new homes being built across the UK.
At the same time, however, the bank also noted that the government’s Help to Buy scheme could help homebuilders weather the economic storm, while a temporary stamp duty holiday at the bottom end of the market could help drive sales, spelling good news for constructors and the real estate sector in general.
Despite Brexit, the UK’s biggest homebuilder Barratt has reported it expects to enjoy a 20 per cent in annual profits this year.