Housebuilders Bellway and Persimmon are shutting construction sites despite being allowed to stay open amid the lockdown as demand from new buyers plummets.
Newcastle-headquartered Bellway said it was closing its 200 building sites by the end of Friday, with site managers only allowed onto developments to maintain security or to hand over keys to buyers.
Charles Church builder Persimmon confirmed it is also starting an “orderly shutdown” of its construction sites, following the lead of rivals Taylor Wimpey and Barratt Developments.
Persimmon said it would continue with essential work only, making partly-built homes safe, where otherwise customers could be left in a vulnerable position.
We weren’t convinced we could police the social distancing or keep workers two metres apart at sitesJason Honeyman, Bellway chief executive
Bellway has already shut its sales offices and Persimmon is closing its sales network from Thursday, offering telephone and online-only customer support.
Bellway chief executive Jason Honeyman told the PA news agency the decision to shut its construction sites in spite of being exempt from the Government-imposed lockdown came as a result of fears for worker safety.
He said: “We weren’t convinced we could police the social distancing or keep workers two metres apart at sites.
“There’s always some people who ignore it.”
He added that the group was also unable to get materials as builders’ merchants are closed and there are no deliveries.
It comes as pressure is mounting on Prime Minister Boris Johnson to order that all non-essential construction work is halted amid worries that workers travelling to sites will hamper efforts to stop the spread of coronavirus.
Builder Redrow said on Tuesday its sites would remain open, though it insisted there were “strict precautions in place including enhanced levels of cleaning, additional hygiene facilities and social distancing”.
Retirement home specialist builder McCarthy & Stone confirmed on Wednesday it was pausing developments – but would keep open some sites that are close to completion.
There was also a flurry of alerts from housebuilders on Wednesday as social distancing measures have hurt trading, with Bellway cautioning it expects buyer demand to “almost cliff edge” as the UK locks down.
The group said sales have plunged by around 40% this week as strict new social distancing measures came into effect with cancellation rates also more than doubling to around 30%.
Mr Honeyman said: “I would expect it (sales declines) to continue beyond that and almost cliff edge.”
Interim figures from Bellway showed a 7% fall in pre-tax profit to £291.8 million for the six months to January 31 as average sales prices fell to £286,570, from £293,832 a year ago.
Persimmon also warned it was “preparing for a significant delay in the timing of legal completions, a rise in cancellation rates and a material slowdown in new sales”.
Vistry, which recently bought Linden Homes from Galliford Try, and Barratt added to the list, noting a sharp worsening of trading.
Barratt said it expects the pandemic and the group’s decision to close all its construction sites to have a “a significant impact on both construction output and reservations”.