Telford boosted by ‘chronic’ London housing shortage
Half-year profits are expected to come in lower, Telford Homes said.
Telford Homes has said London’s “chronic” need for new houses will help the firm mitigate economic and political uncertainty around Brexit, although half-year profits are expected to come in lower.
In a trading update, the group said profit for the first six months of the year is expected to be “significantly lower” than the comparable period in 2016.
Telford said this is due to the “programmed timing of development completions”, adding that full-year profit is on track to hit £40 million.
On housing demand, the firm said: “There remains an ongoing and acute need for more homes to be built across London which is recognised by all political parties and the mayor.
“This is particularly true for non-prime locations where homes can be developed at more affordable prices and rents.
“The imbalance between this need and the supply of new homes continues to underpin the board’s long-term belief in growing Telford Homes and increasing the group’s development capacity.”
Telford pointed to an existing pipeline of more than 4,000 new homes to be delivered across London, with the average expected price standing at £530,000.
However, the firm added that London has been “somewhat subdued” by economic and political uncertainty around Brexit negotiations and the election outcome.
It also said it would continue to focus on the lucrative build-to-rent sector, with contracts for nearly 500 homes worth more than £230 million under its belt.
Chief executive Jon Di-Stefano said: “I expect more build-to-rent transactions as institutional demand continues to grow alongside continuing open market sales at our well-located developments.
“Our ultimate belief in what we do is underpinned by a chronic lack of supply and we expect to deliver more of the homes that London needs in the coming years.”