- Berkeley Group Holdings (The)
- 09 July 2025 10:32:53
Source: Sharecast
RBC said that recent data has been "healthy": mortgage approvals back at pre-Covid levels; housing transactions are returning to normal following a lull after the stamp duty change that came into effect in April; house prices are stable; while mortgage rates are trending downwards.
But the new planning rules announced by the Labour government still need to be enforced, and the social and affordable housing finance still needs to be released. Until local authorities start putting these new measures into place, site openings will not accelerate, the broker said.
"Recent housing market datapoints and key leading indicators paint a picture of health for the UK housing market as a whole, but the new build sector is still being hamstrung by planning and social housing funding delays. If they can't build them, they can't sell them," RBC said in a research note on Wednesday.
"Current sector valuations suggest that investors are concerned about volume downgrades and recovery being pushed to the right."
As a result, some housebuilders are faring better than others, and so the broker has adjusted its ratings across the sector to reflect this.
RBC has raised Berkeley from 'underperform' to 'outperform', and lifted Persimmon from 'underperform' to 'sector perform', while lowering Bellway and Taylor Wimpey from 'outperform' to 'sector perform'.
Meanwhile, Barratt Redrow and Crest Nicholson have been left at 'outperform', while ratings for Gleeson and Vistry stay at 'underperform'.
