Barratt Redrow tells Andy Burnham to cut taxes and slash red tape to boost housebuilding

FTSE 100 housebuilder says current constraints are limiting housing delivery and affordable home construction across the UK

Barratt Redrow has urged Prime Minister-to-be Andy Burnham to slash taxes in order to stimulate housebuilding and eliminate “barriers to home ownership”.

The FTSE 100 housebuilder pressed the government to tackle “the increasing regulatory and tax burdens that are constraining viability” to “unlock higher levels of housing delivery, including affordable housing”.

Burnham has pledged to champion affordable housing and has signalled his backing for a wholesale overhaul of property taxation.

In its latest update to investors on Wednesday, the housebuilder outlined the extent of reform required, warning that urgent action on tax and red tape is needed to “tackle the housing crisis, create jobs and drive economic growth”.

Last week, Barratt Redrow joined forces with property portal Rightmove in a joint appeal to the government, calling for stamp duty to be scrapped for first-time buyers in a bid to breathe life back into the housing market, as reported by City AM.

Rightmove revealed that listings for new developments had fallen to their lowest point since January 2017. According to Zoopla, stamp duty hits first-time buyers in London particularly hard, owing to the capital’s inflated property prices.

While the government currently provides a £300,000 stamp duty relief for first-time buyers, nearly eight in ten first-time movers in London still find themselves liable for the tax, the property portal confirmed. Housebuilders have increasingly turned to Andy Burnham for support in recent weeks.

Last month, FTSE 250 housebuilder Berkeley urged the former Greater Manchester mayor to provide “strong political leadership” on housebuilding.

Berkeley had warned there is “no prospect of material improvement” in conditions for housebuilders “without more decisive intervention” from the government.

Barratt Redrow announced on Wednesday that it intends to allow shareholders to capitalise on the “significant discount” between its share price and net assets.

The housebuilder plans to repurchase £386m worth of shares in the year to July next year, describing it as the “most effective way to create long-term shareholder value”.

The company’s share price has fallen to its lowest point in over a decade in recent weeks, having lost nearly 60 per cent of its value over the past five years. Its shares climbed three per cent to 286p when markets opened on Wednesday.

The firm stated it remains well placed to deliver “attractive” returns for shareholders, despite inflationary pressures stemming from the Iran war, “alongside industry headwinds and subdued consumer demand”.

“This buyback only goes so far in reversing the dismal share price performance, and the recent revival of Middle East hostilities shows that there is still plenty that could go wrong for the sector if inflation returns with a vengeance,” said Chris Beauchamp, chief market analyst at IG. Barratt Redrow completed 17,667 homes in the twelve months to the end of June, hitting the upper end of its guidance, amongst which 3,774 were affordable homes.

The housebuilder placed the value of its order book for forthcoming developments at £2.8bn, representing a four per cent decline from £2.9bn recorded at the same point last year.

The firm was formed in October 2024 following a merger between Barratt Developments and Redrow, and now has its headquarters in Leicestershire. The newly combined business will deliver £53m in cost savings as a result of its joint operations this year, it confirmed.

Building cost inflation climbed to three per cent in the wake of the outbreak of war in Iran, Barratt Redrow revealed, pushing average cost inflation across the full year to two per cent.

Recent “volatility” in energy prices and supply chains, triggered by renewed tensions between the US and Iran, could drive building cost inflation higher in the year ahead, the housebuilder cautioned.

“However, the extent of any impact remains uncertain and will depend on movements in energy prices, broader market conditions and the pace at which supply chains normalise,” it added.